Government Power, Corporate Concentration, Private Equity, and the Decline of Economic Independence

By Jeffrey T. Donner, Esq.

August 27, 2026

Saying that the United States and Western Europe are already living under communism sounds ridiculous if the word “communism” is given its strict twentieth-century definition. The government does not own Walmart, Microsoft, Amazon, Apple, Home Depot, the plumbing company down the street, or my law practice. Americans still own private property, invest in privately owned corporations, start businesses, accumulate wealth, hire employees, enter contracts, and decide for themselves what products and services they want to buy.

Those distinctions are real, and any intellectually serious argument should acknowledge them at the outset. The United States is not the Soviet Union. Western Europe is not Maoist China. There is no central planning ministry in Washington deciding how many refrigerators General Electric may manufacture next year or assigning every American to a government-approved occupation.

Private ownership, private capital, private employment, private investment, and genuine market competition continue to exist on an enormous scale. Anyone who says otherwise is describing a caricature rather than the country in which we actually live.

But that does not end the inquiry. It merely establishes that we have not reached one extreme endpoint on a much larger economic spectrum. Economic systems are not binary switches marked CAPITALISM and COMMUNISM, and a society does not cease to be economically free only on the day the government finally confiscates the last privately owned factory.

Everything is a sliding scale.

The meaningful questions are not merely who holds formal legal title to property, but who controls the money, who determines where capital goes, who establishes the conditions under which economic activity may occur, who controls the institutions upon which everyone else depends, and how much practical independence remains for the supposedly private owner. Once the issue is framed that way, the line separating our enormous modern state from what we continue to call the “private sector” becomes considerably less clear.

The modern Western system has accomplished something Marx and Lenin probably did not envision. We have preserved much of the outward architecture of private property while transferring an extraordinary amount of practical economic power to governments, giant financial institutions, publicly dependent corporations, regulators, government contractors, institutional investors, technology platforms, and conglomerates whose economic interests increasingly intersect.

We did not nationalize the entire economy.

We built something more complicated.

Ownership and Control Are Not the Same Thing

Suppose I own a factory. My name appears on the deed, my corporation owns the machinery, I employ the workers, and nobody from the government sits in my office every morning telling me exactly what to manufacture. By the ordinary American definition, that sounds like capitalism.

Now add the rest of the facts. Government determines whether I may build the factory, where I may build it, what environmental approvals I need, what zoning classifications apply, what labor practices are permissible, what workplace-safety requirements apply, what products I may manufacture, what warnings those products must contain, what information I must report, what taxes I must pay, what accounting rules I must follow, what foreign components I may buy, which countries I may sell to, and perhaps whether one of my largest potential customers—the government itself—will purchase my products.

Suddenly, saying that I “own” the factory tells us considerably less than it appeared to tell us at first.

Ownership has always been economically valuable because of the bundle of rights associated with it. The ability to decide how property is used, who may use it, whether it may be sold, how it may be improved, and how its economic value may be realized are the things that make ownership meaningful. If another institution increasingly possesses authority over each of those decisions, the significance of formal ownership necessarily changes even though the deed remains in private hands.

There is no precise point at which this transformation becomes complete. One environmental permit obviously does not abolish capitalism, and neither does one employment law, one zoning regulation, one tax, or one licensing requirement. The problem is cumulative, which is why the constant insistence on binary labels obscures more than it clarifies.

Follow the Money

Capitalism is fundamentally an allocation system. Millions of people independently decide what they want, what they need, what they are willing to pay for, and what they are willing to risk their own money to produce. Somebody wants a new roof, somebody wants a hamburger, somebody needs a lawyer, somebody wants a bicycle, somebody wants to build a warehouse, and somebody else has capital and is trying to determine where to invest it.

Those individual decisions collectively allocate resources without any central authority deciding what society requires. Nobody sits in an office determining that America needs exactly 13 percent more roofing contractors this year or that the national supply of hamburgers should increase by 8 percent. Entrepreneurs see demand, risk their money, compete for customers, succeed, fail, expand, contract, and sometimes go bankrupt.

Government allocation operates differently. Government obtains resources principally through taxation and borrowing, then determines where those resources will go through legislation, appropriations, administrative programs, contracts, grants, subsidies, reimbursements, tax preferences, guarantees, and regulatory policy. That is economic allocation just as surely as a consumer deciding where to spend a paycheck is economic allocation.

The scale of that governmental allocation is enormous. The Congressional Budget Office projects that the federal government alone will spend approximately $7.4 trillion in fiscal year 2026, equal to about 23.3 percent of GDP. Federal revenues are projected at approximately $5.6 trillion, or 17.5 percent of GDP, with the enormous difference financed through additional borrowing. (Congressional Budget Office)

Those figures do not mean that the federal government literally “controls 23.3 percent of the economy,” and it would be analytically careless to pretend that they do. Nor can federal, state, and local spending simply be stacked on top of one another without accounting for transfers among levels of government. But the numbers make the larger point unavoidable: government is not a minor referee standing on the sidelines of an otherwise private economy.

It is one of the largest economic actors in the economy.

The broader American tax burden is substantial as well. OECD data placed total U.S. tax revenue at 25.6 percent of GDP in 2024, while the OECD average was 34.1 percent. The United States is therefore less heavily taxed than many other developed Western countries, but that comparison also demonstrates how enormous the public sector has become throughout the Western world. (OECD)

Again, there is no magical percentage at which capitalism disappears. Twenty-five percent is not capitalism while 26 percent is communism. The point is that the larger the share of society’s resources routed through government, the larger the share of economic allocation ultimately determined politically rather than privately.

Taxation Is About More Than What Remains in Your Paycheck

Tax debates are usually framed too narrowly. One political party proposes one rate, the other proposes another, economists calculate behavioral effects, and politicians argue about fairness. The deeper issue is not simply how much money remains in the taxpayer’s bank account after government has taken its share.

Every dollar taken in taxation is also a transfer of allocative authority. Suppose I earn $100 and keep it. I decide whether to spend it, save it, invest it, give it to my children, buy a bicycle, hire an electrician, retain a lawyer, go to a restaurant, pay down my mortgage, or leave the money untouched.

Now suppose government takes $30. Government decides what happens to that $30. It might build a highway, pay a teacher, purchase a missile, reimburse a hospital, subsidize an industry, pay interest on government debt, send money to another government, or employ an administrator to oversee a program that distributes money to somebody else.

Some of those expenditures may be excellent uses of public money, and some may be terrible. That is not the immediate point. The point is that the decision about where the resource goes has moved from the person who earned it to a political institution.

Multiply that process across trillions of dollars and political power necessarily becomes economic power. Businesses, industries, nonprofits, universities, contractors, state governments, local governments, and entire professions naturally begin organizing themselves around obtaining access to that enormous pool of politically allocated capital.

The Private Sector That Works for Government

More than 23 million jobs appear on federal, state, and local government payrolls under the establishment survey figures for July 2026. BLS reported approximately 2.7 million federal jobs, 5.5 million state-government jobs, and 15.1 million local-government jobs on a seasonally adjusted basis. (Bureau of Labor Statistics)

But counting people whose paycheck literally comes from government dramatically understates government-dependent employment.

Consider a private company that builds highways. Its employees work for a corporation rather than the Department of Transportation, and their W-2s are technically private-sector W-2s. Yet the customer funding the project may be a government agency using tax revenue or borrowed public money.

The same is true of companies building courthouses, schools, airports, military installations, water-treatment facilities, transit systems, prisons, municipal buildings, and countless other public projects. Private engineering firms design them, private construction companies build them, private suppliers provide materials, private insurers underwrite risks, private law firms handle disputes, and private consultants advise everybody involved.

Now move one step farther down the chain. The prime contractor hires subcontractors, the subcontractors buy trucks and equipment, the equipment companies employ mechanics and salespeople, those employees buy houses and cars and furniture, and the money eventually reaches restaurants, landscapers, dentists, accountants, lawyers, grocery stores, and virtually every other corner of ordinary commerce.

By the twentieth transaction, every exchange looks entirely private. Yet if the original publicly funded project did not exist, much of the downstream activity generated by that project would not exist in the same form.

That does not make every participant a government employee. It does mean that our supposedly private economy is considerably more dependent upon government spending than the public payroll figures reveal.

Even My Own Private Law Practice Depends Upon Government

I can make the point against myself. I am a private-sector lawyer, my clients are generally private parties, and I do not receive a government paycheck. Yet my profession depends upon an institution created and maintained by government: the court system.

Why does a plaintiff pay a lawyer thousands or hundreds of thousands of dollars to pursue litigation? Because a successful lawsuit can produce something more than an academic declaration that the plaintiff was right. A court can enter a judgment, and the coercive authority of the state stands behind that judgment through garnishment, execution, liens, injunctions, contempt, and other enforcement mechanisms.

The defendant hires a lawyer for exactly the same reason. If judgments were meaningless pieces of paper, defendants would have much less reason to spend serious money defending lawsuits. The defendant retains counsel because the government maintains a functioning judicial system capable of converting an adverse judgment into the actual loss of money, property, or legal rights.

So even my private livelihood depends upon government. But this example demonstrates an important distinction rather than undermining the argument. Courts are part of the institutional architecture that makes private property and voluntary transactions possible in the first place.

A contract has limited economic value if nobody can enforce it. Property rights mean little if there is no neutral institution capable of protecting them. Credit becomes more expensive and commerce more dangerous if promises are unenforceable and property can simply be taken without consequence.

There is therefore a profound difference between government enforcing an agreement two private parties voluntarily made and government deciding that one politically favored industry should receive a multibillion-dollar subsidy. One governmental function protects private allocation. The other substitutes political allocation for private allocation.

That distinction is essential. The argument for limited government is not an argument for no government at all, because capitalism itself depends upon courts, police, contract enforcement, property rights, national defense, and other genuinely public institutions. The argument concerns what government should do beyond those functions and how much of ordinary economic life it should attempt to control.

Microsoft: A Private Company That Became Institutional Infrastructure

Microsoft is where this discussion becomes particularly interesting because it is tempting to say that Microsoft became dominant because of government contracts. That is not accurate.

Microsoft did not become the operating-system standard because Washington simply selected Windows and ordered the private economy to follow. The federal antitrust litigation against Microsoft established a more complicated history. The courts found that Microsoft’s Windows monopoly was protected by what they called the “applications barrier to entry”: users wanted the operating system that ran the most applications, and software developers naturally wanted to write software for the operating system with the most users. That created a self-reinforcing cycle in which Microsoft’s enormous installed base attracted software developers, which in turn made Windows even more attractive to users. The courts also found that Microsoft unlawfully maintained monopoly power through exclusionary conduct. (justice.gov)

That history matters because it illustrates how economic control can arise without government ownership. Once enough businesses used Windows and Microsoft Office, switching away from Microsoft was no longer simply a matter of deciding that another word processor had better features. File compatibility, employee training, IT systems, existing software, business processes, email systems, security, and the expectations of customers and counterparties all became part of the cost of switching.

Anyone who has practiced law during the last thirty years understands this intuitively. A lawyer could theoretically decide tomorrow that Microsoft Word is overpriced and abandon it. In the real world, however, courts, clients, opposing counsel, document-management systems, templates, metadata tools, redlining programs, and decades of accumulated documents are built around Microsoft formats.

That is not government coercion. It is network power.

Now add government to the picture. Microsoft has built entire government-specific versions of its cloud and productivity ecosystem, including Microsoft 365 Government, Government Community Cloud, GCC High, Department of Defense environments, and Windows 365 Government. Those products are designed specifically around federal, state, local, defense, criminal-justice, export-control, and other public-sector compliance requirements. (Microsoft)

Microsoft was also one of four companies awarded access to the Department of Defense’s Joint Warfighting Cloud Capability procurement, alongside Amazon Web Services, Google, and Oracle. The point is not that this contract created Microsoft; it plainly did not. The point is that a company already embedded throughout private institutional life has simultaneously become deeply embedded throughout government. (U.S. Department of War)

This creates a powerful feedback loop. Businesses use Microsoft because everybody else uses Microsoft, government uses Microsoft because businesses and government employees already understand Microsoft, contractors must use systems compatible with government, and the enormous installed base makes competing ecosystems harder to establish.

Microsoft is not the government.

But Microsoft has become something closer to private infrastructure than an ordinary company selling products in an ordinary competitive market.

That distinction matters.

Amazon: When a Retailer Becomes Infrastructure

Amazon may be an even better example because it started as something everyone understood: an online bookstore. Nobody looking at Amazon in the 1990s would have mistaken it for a government institution or a piece of national infrastructure.

Thirty years later, Amazon sells almost everything, operates a massive logistics network, provides cloud computing through AWS, streams entertainment, operates advertising platforms, sells groceries, delivers pharmaceuticals, manufactures hardware, runs a marketplace used by millions of third-party sellers, and increasingly provides delivery speeds that would once have sounded economically absurd.

In 2025, Amazon says it delivered more than 13 billion items globally on the same day or the next day, including more than 8 billion in the United States. Prime now offers free shipping on hundreds of millions of items, with tens of millions available for same-day or next-day delivery. (Amazon News)

That is no longer merely a website.

It is an infrastructure network.

Amazon’s scale produces exactly the same kind of self-reinforcement that Microsoft experienced in software, although through different mechanisms. More customers justify more warehouses and delivery infrastructure, better infrastructure attracts more customers, more customers attract more third-party sellers, more sellers increase selection, greater selection attracts more customers, and the resulting scale gives Amazon still more ability to invest in logistics.

The federal government itself has alleged that Amazon has crossed from extraordinary competitive success into unlawful monopoly maintenance. The Federal Trade Commission and numerous states sued Amazon alleging that it uses interlocking practices to maintain monopoly power, prevent rivals and sellers from lowering prices, overcharge sellers, and impede competition. Those remain allegations in litigation, not facts that should simply be stated as adjudicated conclusions, but their existence demonstrates that the concern about Amazon’s structural power is hardly a fringe theory. (Federal Trade Commission)

Then there is AWS.

Amazon is not merely delivering paper towels and dog food. Amazon Web Services is a major provider of government cloud infrastructure and is one of the four companies participating in the Defense Department’s Joint Warfighting Cloud Capability contract. Amazon itself describes AWS as supplying mission-critical cloud capabilities to the Department of Defense. (Amazon Web Services)

So when someone says provocatively that “Amazon is the government,” the literal statement is obviously false. Amazon is a private corporation with shareholders, competitors, private employees, private assets, and profit-seeking management.

But the intuition behind the statement is worth examining. A private company can become so intertwined with commerce, logistics, computing infrastructure, public procurement, and daily life that the distinction between “ordinary business” and “infrastructure” begins to blur.

Amazon is not government.

But government and Amazon increasingly depend upon some of the same infrastructure.

Amazon Changed What Every Other Retailer Has to Be

Amazon’s most visible effect may not be what Amazon itself does. It may be what Amazon has forced everybody else to do.

Twenty years ago, nobody expected a hardware store, department store, or grocery store to deliver a miscellaneous $30 order to your house tomorrow for free. Shipping was a separate service with an obvious cost, and consumers understood that somebody had to pay UPS, FedEx, or another carrier to move the package.

Amazon changed the reference point.

Once consumers became accustomed to paying one annual Prime fee and receiving enormous numbers of packages quickly without seeing a separate shipping charge on each order, every competing retailer had a problem. The actual cost of transportation did not disappear. Consumers simply became increasingly unwilling to see the cost itemized.

That distinction is economically important. “Free delivery” is not free any more than a free parking garage is free. Warehouses cost money, trucks cost money, drivers cost money, fuel costs money, inventory costs money, software costs money, packaging costs money, and somebody ultimately absorbs those costs through membership fees, product margins, advertising revenue, marketplace fees, efficiencies of scale, or some combination of them.

But once Amazon built that expectation, competing retailers could not simply lecture consumers about economics.

They had to respond.

Walmart: The Giant That Had to Become More Like Amazon

There is something almost ironic about Walmart being forced into this competition. For decades, Walmart itself represented the overwhelming giant that small retailers could not match. Walmart built enormous purchasing power, extraordinarily sophisticated logistics, national distribution, low prices, and supercenters capable of putting countless independent retailers under tremendous pressure.

Then Amazon changed the terrain.

Walmart now markets Walmart+, an annual subscription program costing $98 that includes free delivery from stores on qualifying orders over $35 and free next-day and two-day shipping on many Walmart.com orders without an order minimum. Walmart also offers same-day delivery for qualifying purchases. (Walmart.com)

Think about how extraordinary that is historically. Walmart already possesses thousands of stores, massive distribution centers, some of the best retail logistics in the world, and purchasing power that would have been unimaginable to a department-store operator fifty years ago. Yet even Walmart concluded that merely having a store ten minutes from someone’s house was no longer enough.

It now has to bring the store to the house.

I would not say Walmart “cannot compete” with Amazon. That overstates the case, and Walmart’s physical-store network actually gives it advantages Amazon does not possess in some categories. What Walmart cannot do is ignore the consumer expectation Amazon created.

That distinction is more interesting anyway.

The result is an arms race in convenience in which only enormous companies can realistically participate at national scale. Amazon invests billions in fulfillment, Walmart builds its own enormous delivery network, and the consumer becomes accustomed to receiving increasingly small purchases increasingly quickly without confronting the true incremental cost of each delivery.

Now consider the independent merchant.

The independent hardware store cannot build 4,000 fulfillment nodes.

The independent sporting-goods store cannot offer a nationwide membership program with free delivery.

The independent bookstore cannot amortize logistics costs across billions of transactions.

The customer may still like the independent business. He may even sincerely say that he wants local businesses to survive.

Then his phone tells him Amazon can have the product on his porch by 7:00 p.m.

That is economic concentration without a government official ordering anybody to concentrate.

Target: Another Retailer Becomes a Logistics Company

Target presents essentially the same phenomenon. It is still recognizably a traditional retailer with physical stores, shopping carts, aisles, cash registers, parking lots, and merchandise displays. Yet increasingly it too must operate as a digital logistics company.

Target Circle 360 costs $99 annually at its standard rate and offers unlimited same-day delivery on qualifying orders over $35, along with free two-day shipping on large numbers of items. Target says its same-day system uses hundreds of thousands of shoppers and covers much of the United States. (Target)

In 2026, Target also expanded next-day delivery to more than 50 major U.S. metropolitan areas, often free for purchases over $35. (Target Corporation)

Again, nobody at Amazon sent Target a legal notice ordering it to do this. Government did not enact the Amazon Delivery Act requiring Target to provide rapid fulfillment.

Market power works more subtly than that.

Once one enormously scaled company changes consumer expectations, competitors either adapt or become progressively less convenient. Target therefore becomes partially a logistics company because Amazon taught consumers that retail shopping should include logistics as part of the basic transaction.

Walmart becomes more like Amazon.

Target becomes more like Amazon.

Everybody becomes more like the institution large enough to redefine the market.

Home Depot: Even Lumber and Plumbing Parts Have to Arrive Immediately

Home Depot might be the strangest example because home improvement historically seemed resistant to this transformation. A hardware or building-supply business sells awkward things: lumber, toilets, bags of concrete, drywall, power tools, pipe, mulch, appliances, fasteners, and countless products that do not fit conveniently into the traditional parcel-delivery model.

Yet Home Depot now advertises free standard delivery on more than two million items and free same-day delivery on tens of thousands of qualifying orders. It offers same-day, next-day, scheduled, and job-site delivery, and has expanded rapid fulfillment through arrangements involving Instacart, DoorDash, and Uber Eats. (The Home Depot)

Its professional-customer operation advertises free next-day job-site delivery on thousands of commonly purchased items. (The Home Depot)

That is an extraordinary transformation of what a “store” means.

A generation ago, if a contractor needed another box of fasteners, somebody drove to Home Depot. Increasingly, Home Depot is competing to make even that trip unnecessary.

Again, this is partly good. Consumers benefit from convenience, businesses save employee time, disabled customers gain access, contractors can keep crews working instead of sending someone across town, and competition produces innovation.

The argument is not that convenience is evil.

The argument is that the capital investment necessary to provide this level of convenience favors institutions already operating at massive scale. Amazon raises the standard, Walmart responds, Target responds, Home Depot responds, and eventually what counts as merely adequate customer service becomes something that a small competitor could never afford to reproduce.

The competitive game therefore becomes increasingly accessible only to giants.

Apple: Private Power Can Resemble Regulation Too

Apple fits the argument differently because Apple is not primarily a government contractor and its dominance cannot seriously be attributed to public procurement. Apple built enormously successful products that consumers voluntarily purchased, often at premium prices, and it created an ecosystem people genuinely prefer.

That is capitalism working.

But Apple’s ecosystem also demonstrates how sufficiently concentrated private power can acquire regulatory characteristics of its own. Apple determines the technical rules governing the iPhone ecosystem, controls crucial interfaces, establishes conditions for software distribution, sets platform rules, and can materially affect whether other businesses gain access to hundreds of millions of customers.

The Justice Department and a coalition of states sued Apple in 2024, alleging that Apple maintained monopoly power in smartphone markets by using contractual restrictions and control over critical access points to make switching more difficult and suppress technologies that might reduce dependence on the iPhone. Those are allegations, not final adjudicated findings, and Apple disputes them. (Department of Justice)

The interesting point for present purposes is not whether the government ultimately wins that lawsuit.

It is that Apple has become powerful enough for its internal platform rules to become questions of public economic policy.

The company’s decisions about interoperability, applications, messaging, payments, accessories, and software can affect entire industries. Government then decides whether those private decisions have become sufficiently powerful to require antitrust intervention.

That produces another strange overlap between public and private governance. Apple acts like a private rule-maker within its ecosystem, and the government acts as the ultimate rule-maker determining how much rule-making power Apple may exercise.

The consumer remains formally free throughout the process.

But again, freedom exists on a sliding scale.

Uber: When a Private App Starts Becoming Public Transportation

Uber illustrates yet another version of the same phenomenon. It began as a private alternative to taxis: open an app, request a private car, pay a private company, and arrive at your destination.

There is nothing remotely communist about that.

But Uber’s relationship with government has evolved in an interesting direction. Uber now explicitly markets transportation solutions to public transit agencies, municipalities, and regional authorities. As of August 2026, Uber says more than 150 public transit agencies, municipalities, and regional authorities are already using Uber Transit arrangements. (Uber)

Uber also partners with public agencies on paratransit and other publicly funded transportation programs. Its stated use cases include supplementing microtransit, providing first-mile and last-mile connections, serving transit deserts, replacing or supplementing weak fixed-route service, assisting paratransit users, and providing transportation during service disruptions. (Uber)

Think about how strange that would have sounded when Uber started.

The private company initially disrupts the regulated taxi industry.

Government fights with it.

Government regulates it.

Eventually government itself hires or partners with it to perform pieces of what historically would have been considered public transit.

Again, Uber is not the government.

But the boundary between public function and private platform becomes increasingly difficult to describe with one-word labels.

A citizen may take what he experiences as public paratransit, financed partly through public money, supplied through a private transportation platform, driven by an independent or quasi-independent driver using a privately owned automobile, arranged through software controlled by a multinational corporation.

Is that capitalism?

Yes.

Is government involved?

Obviously.

Is it a public service?

In some instances, yes.

Is it privately delivered?

Also yes.

This is precisely why twentieth-century categories increasingly fail to describe twenty-first-century economic reality.

Amazon, Microsoft, Apple, Uber: The Emergence of Private Governments

There is a broader concept tying these companies together.

Large technology platforms increasingly perform functions that resemble governance.

Microsoft establishes the technical standards through which enormous numbers of institutions communicate.

Amazon determines marketplace rules for millions of sellers and operates logistics and computing infrastructure upon which businesses and government agencies rely.

Apple governs access to a software and hardware ecosystem used by an enormous portion of the population.

Uber establishes rules governing drivers, riders, pricing, access, ratings, and increasingly portions of transportation systems that overlap with publicly financed transportation.

None of these companies possesses sovereignty in the constitutional sense. They cannot imprison someone, levy general taxes, conscript soldiers, or enact criminal statutes.

Yet each creates rules, allocates access, resolves disputes, collects fees, controls critical infrastructure, and can impose economic consequences upon people who depend upon its system.

That looks less like the local hardware store and more like a form of private administration.

Meanwhile, actual government regulates those private administrators while simultaneously purchasing their services.

This is not communism in the Marxist sense.

It is a merger of public and private institutional power that Marx’s vocabulary does not adequately describe.

Private Equity and the Financialization of the Private Economy

There is another development that traditional arguments about capitalism and communism often fail to address. Even the portion of the economy we continue to call “private” looks increasingly unlike the entrepreneurial capitalism Americans traditionally imagine when they use that term.

The old model is easy to understand. Somebody starts a company, makes something people want, develops a reputation, builds factories or stores, hires employees, reinvests earnings, and perhaps passes the company to the next generation. The business exists primarily as an enterprise whose purpose is to produce goods or services profitably over a long period.

Increasingly, businesses themselves become financial assets. Private-equity funds buy them, public corporations acquire them, conglomerates absorb them, and institutional investors analyze them as collections of cash flows, real estate, intellectual property, debt capacity, tax attributes, trademarks, licensing opportunities, and potential divestitures.

That does not automatically make companies worse. Private-equity ownership is not a single economic disease producing identical results in every transaction. Some acquisitions provide capital, rescue badly managed companies, impose needed discipline, expand businesses, and save enterprises that otherwise might fail.

But the incentive structure can differ materially from that of a founder who expects to spend the rest of his life running the company. The founder may care intensely whether the company will still have an excellent reputation twenty years later because the company’s identity and his own are closely connected. A financial owner may rationally focus more heavily on the return generated during a defined investment period and the valuation obtainable upon exit.

Those incentives can align.

Sometimes they do not.

Red Lobster: The Real Story Is Complicated Enough

Red Lobster is useful precisely because the simplified internet story is exaggerated. The popular version says private equity bought Red Lobster, sold the land out from under the restaurants, pocketed the money, charged the restaurants rent, and destroyed the company.

The actual history is more complicated.

In 2014, Darden sold Red Lobster to Golden Gate Capital for approximately $2.1 billion. In connection with the transaction, approximately 500 Red Lobster properties were sold in a roughly $1.5 billion sale-leaseback transaction, with leases generally structured around very long initial terms.

The economics are fascinating. Valuable real estate that had been part of the enterprise became a financing source for the acquisition, while the restaurant business continued operating with lease obligations attached to those locations. The stores remained open, the signs still said Red Lobster, and customers still ate lobster biscuits.

But the balance sheet had changed.

Red Lobster’s eventual bankruptcy was not caused by one thing. Management decisions, competition, costs, promotional mistakes, operating performance, and many other factors mattered. It would therefore be false to reduce the bankruptcy to a single private-equity transaction.

Nevertheless, the sale-leaseback illustrates the extraction concern perfectly. An operating enterprise may have accumulated productive assets over decades, and a financial transaction can monetize those assets today while creating obligations the operating company must continue paying tomorrow.

The transaction can make sense to the people executing it and still make the business less resilient.

Those are not contradictory propositions.

The Extraction Problem

A leveraged acquisition may place substantial debt on the acquired enterprise. Assets can be sold, real estate can be separated from operations, management fees can be charged, divisions can be divested, staffing can be reduced, and long-term investments can be deferred.

Some of those actions can improve a company. Bad management is real, corporate bureaucracy is real, waste is real, and companies that refuse to change can disappear just as surely as companies that are over-financialized.

The legitimate concern arises when eliminating waste becomes extracting productive capacity.

One of the strongest examples comes from healthcare. Research examining private-equity acquisition of nursing homes found adverse effects including lower staffing and increased mortality among certain patients after acquisition. The researchers themselves described the effects as nuanced rather than universally catastrophic, but the evidence demonstrates that ownership incentives can affect operational outcomes in ways that matter far beyond an investment spreadsheet. (National Bureau of Economic Research)

That is the larger problem with financialization. The people making money from the transaction and the people depending upon the institution for long-term service are not necessarily operating on the same time horizon.

Steak ’n Shake and the Modern Meaning of “Owner”

Steak ’n Shake offers another miniature version of the ownership problem.

The company advertises an opportunity to become a “Franchise Partner” for an initial investment of only $10,000. That sounds extraordinary in a restaurant industry where conventional franchises can require hundreds of thousands or millions of dollars in capital.

But the company’s own disclosures explain what the arrangement actually entails. The franchise partner pays an initial $10,000 investment, is expected to operate the restaurant personally, and the company assesses fees of up to 15 percent of sales plus 50 percent of profits. Biglari Holdings also reports receiving rental income because franchise partners rent buildings and equipment from Steak ’n Shake. (SEC)

That does not necessarily make the arrangement a scam. Steak ’n Shake is supplying enormous amounts of capital, an established restaurant, equipment, a brand, systems, suppliers, and operational infrastructure. An operator who puts up only $10,000 cannot reasonably expect the economics of somebody who invested millions constructing a restaurant.

But calling the person an “owner” illustrates how flexible the concept of ownership has become.

The operator has an ownership-like economic interest but personally operates one restaurant, cannot simply function as an absentee investor, shares substantial economics with the parent company, and may be operating property and equipment owned by somebody else. In ordinary English, many people would describe that person as something closer to an entrepreneurial general manager with significant profit participation than the conventional picture of somebody who owns a restaurant outright.

Maybe that is a good business model.

The point is that the word “owner” no longer answers the important questions.

Who controls the asset?

Who controls the brand?

Who gets the revenue?

Who gets the profit?

Who owns the real estate?

Who can terminate the relationship?

Who makes the important decisions?

Those questions matter more.

Everlast, Colt, Mongoose, and the Disappearance of the Independent Company

The same pattern appears when famous companies become brands inside enormous portfolios.

This needs to be described accurately because not every legacy brand was destroyed by private equity. Everlast, Colt, and Mongoose followed different ownership paths.

Everlast was acquired in 2007 by a subsidiary of Sports Direct International in a transaction valued at more than $168 million.

Colt was acquired in 2021 by Czech firearms group CZG for $220 million in cash plus shares and possible additional consideration. (Colt’s Manufacturing Company LLC)

Mongoose was part of Dorel Sports, which was sold in 2022 to Pon Holdings for approximately $810 million along with a portfolio of other bicycle brands. (Dorel Industries)

Those are not all private-equity transactions, and it would be false to describe them that way.

But they illustrate a broader development that is just as important.

A company can gradually stop being an independent enterprise and become a brand inside somebody else’s portfolio.

The trademark survives.

The logo survives.

The history survives.

The advertisements tell you when the company was founded.

But the economic institution that created the reputation may no longer exist in anything resembling its original form.

That does not automatically mean the product becomes bad. Everlast still sells serious boxing equipment. Colt still manufactures firearms. Mongoose still sells bicycles.

But a historical manufacturing company can become something different when the brand itself becomes the most valuable surviving asset.

The founder built a company.

The conglomerate acquires intellectual property.

Those are related activities, but they are not identical.

From a Nation of Owners to a Nation of Renters

The same concern appears in housing, although this is another subject where exaggeration can obscure a legitimate problem. The internet version says BlackRock, private-equity firms, and giant investment funds are buying all the houses in America so ordinary citizens will eventually own nothing and rent everything from Wall Street.

That is not supported by the evidence.

GAO recently examined institutional ownership in six metropolitan areas and found that institutional investors owned only about 1 to 3 percent of all single-family homes in those markets by 2024. So the claim that institutional investors are literally buying “all the houses” is nonsense. (GAO)

But national or metropolitan averages do not make the phenomenon irrelevant.

GAO found institutional investors had become much more significant within the single-family rental market itself, ranging as high as 22 percent of single-family rental homes in Jacksonville. Their holdings also increased across each of the six metropolitan areas examined. (GAO)

The origin of the business model is revealing as well. Institutional investors used access to cash and low-cost financing to purchase large numbers of foreclosed homes following the 2007–2009 financial crisis, converting them into rental portfolios. (GAO)

The ordinary family wants one house.

The institution sees the same house as a yield-producing asset.

The family has savings, a mortgage application, and perhaps a 30-year loan. The institutional buyer may have access to large pools of equity, debt markets, securitization, analytics, and an acquisition system capable of evaluating thousands of houses.

There is nothing inherently immoral about renting homes, and professional landlords can sometimes provide better management than small landlords. The serious question is whether society should be indifferent to an increasing portion of ordinary residential housing becoming an institutional asset class.

A society containing millions of homeowners creates one kind of economic independence.

A society containing increasingly large numbers of permanent renters whose housing is owned by large institutions creates another.

Ownership creates equity, inheritance, collateral, stability, and a degree of independence.

That distinction matters.

Government Did Not Create Every Problem, but It Creates the Playing Field

This is where both the political Left and Right often become intellectually lazy.

The Left looks at a private-equity acquisition and says capitalism did it.

The Right looks at a government subsidy and says socialism did it.

Modern reality is much messier because private and public power increasingly operate through one another.

Private capital operates within rules created by government. Government increasingly relies upon private contractors. Banks depend upon government-created financial infrastructure, while government depends upon banks and private capital markets.

Technology companies sell essential services to government. Government grants contracts, licenses, regulatory approvals, intellectual-property protections, and legal frameworks that allow those companies to function.

Institutional investors operate inside securities, tax, banking, bankruptcy, antitrust, and property-law systems. Housing supply is profoundly affected by zoning and permitting policy. Healthcare is often privately delivered while substantial portions of its revenue come through public programs.

The resulting system is neither laissez-faire capitalism nor classical socialism.

It is a hybrid.

And hybrids can produce the pathologies associated with both extremes.

We can get bureaucracy, political favoritism, rent-seeking, subsidy dependence, and centralized allocation from government while simultaneously getting financial extraction, monopoly power, consolidation, and concentrated ownership from the private sector.

That combination may be worse than either side’s textbook caricature because each side can blame the other while participating in the same system.

When Size Becomes Political Power

A small plumbing company has almost no political power. It cannot employ fifty lobbyists, threaten to move 20,000 jobs to another state, maintain a Washington government-relations office, hire former regulators to navigate agencies, or spend ten years litigating a rule that threatens its business model.

A giant corporation has options unavailable to the small business. It can hire lawyers, lobbyists, consultants, economists, former government officials, and regulatory specialists. It can spread compliance costs across billions of dollars in revenue and participate in the process through which rules affecting its industry are developed.

Scale therefore creates something beyond ordinary economic efficiency.

It creates access.

Once government controls enormous amounts of money and regulatory authority, access to government becomes economically valuable. This is where concentrated private capital and concentrated governmental power begin reinforcing one another.

Large corporations can navigate enormous government more efficiently than small firms can. Enormous government often finds it easier to deal with a small number of enormous institutions than with millions of independent businesses.

Regulatory compliance itself becomes a fixed cost. Microsoft can maintain enormous compliance departments. Amazon can hire armies of lawyers. Walmart can build systems around thousands of regulations.

The man employing twelve people cannot.

A regulation may therefore be enacted publicly in the name of restraining large corporations while practically increasing their competitive advantage. The giant incumbent absorbs the compliance burden while the small competitor disappears.

The regulation intended to restrain concentration can actually produce more concentration.

The Connection Economy

Relationships have always mattered in business. People hire people they trust, companies maintain relationships with customers, and professional networks existed long before modern government. There is nothing inherently corrupt about that.

The problem changes when government becomes an enormous purchaser, regulator, lender, guarantor, employer, land-use authority, grant-maker, and allocator of tax advantages. At that point political relationships become a distinct form of economic capital.

The company seeking government contracts needs people who understand procurement.

The developer needs people who understand zoning boards.

The hospital needs people who understand government reimbursement.

The university needs people who understand federal grants.

The defense contractor needs people who understand the Pentagon.

The technology company needs people who understand federal cybersecurity and procurement rules.

The financial institution needs people who understand Washington.

The corporation seeking legislative changes needs lobbyists.

None of this requires criminal corruption. Nobody has to hand a politician an envelope full of cash.

The incentives alone are enough.

Economists use the term “rent-seeking” to describe efforts to obtain economic advantage through political mechanisms rather than ordinary productive competition. The more resources government controls, the greater the potential return from successfully influencing how those resources are distributed.

That gradually changes what the economy rewards. Knowing how to make something customers want remains important, but knowing how to obtain government permission becomes important too. Understanding customers remains valuable, but understanding procurement, regulation, subsidies, tax credits, zoning, licensing, and political institutions can become just as valuable.

Eventually connections cease to be merely useful.

They become part of the capital structure of modern economic life.

If You Don’t Work for the Party

America obviously does not require Communist Party membership to obtain employment. Political dissent does not automatically make someone legally unemployable, and comparisons with historical totalitarian systems must therefore be made with care.

But the historical communist model illustrates a broader economic principle. When the state controls nearly every meaningful avenue of advancement, political conformity becomes economically rational even without someone explicitly ordering it.

A person does not have to love the party.

He merely has to understand that antagonizing the institution controlling his livelihood is dangerous.

A diluted version of that principle occurs whenever political institutions control enough economic resources. A company dependent upon a regulator thinks carefully before antagonizing that regulator. A government contractor understands that the government is not merely a regulator but also a customer.

A university dependent upon government money understands federal policy.

A nonprofit receiving grants understands that grants come with conditions.

A corporation seeking tax incentives understands who controls those incentives.

Nobody necessarily telephones any of these organizations and orders them to conform.

Dependence itself changes behavior.

That is why economic independence matters so much to political liberty.

Government Employment and the Reversal of Risk

There was once a broadly understood tradeoff in American professional life. Private-sector employment offered more financial upside and more risk, while government employment offered stability, benefits, and security in exchange for lower compensation.

That proposition is now much too simplistic.

CBO’s detailed comparison found that the relationship varies dramatically by education. In 2022, federal total compensation was about 40 percent higher for workers with a high-school education or less than for comparable private-sector workers, and about 5 percent higher for workers whose highest degree was a bachelor’s degree. By contrast, federal workers with professional degrees or doctorates received total compensation about 22 percent below comparable private-sector workers. Federal benefits overall cost about 43 percent more than benefits for comparable private-sector workers in the study. (Congressional Budget Office)

So the claim that every government worker earns more than his private-sector counterpart is false.

But the old claim that government employment necessarily means financial sacrifice is also false.

Government employment can combine competitive compensation with substantial retirement benefits, paid leave, predictable career progression, job protections, and significantly less exposure to ordinary entrepreneurial risk.

The small-business owner lives in a different economic universe.

The plumber buys the truck before knowing whether enough customers will call.

The electrician purchases tools and insurance.

The contractor signs leases, pays workers, and waits to be paid.

The restaurant owner owes rent whether the dining room is full or empty.

The small lawyer pays rent, software costs, malpractice insurance, health insurance, employees, marketing expenses, bar dues, taxes, and every other cost of operating a business before knowing what remains for his own family.

The government agency does not need to persuade anyone voluntarily to purchase its services before making payroll.

That is a fundamentally different risk structure.

Federal judges provide a simple illustration. In 2026, federal district judges earn $249,900 and circuit judges earn $264,900. (United States Courts)

Those salaries may be completely justified. Competent judges perform difficult work of enormous public importance, and the judiciary should not be staffed by people who are financially vulnerable or incapable.

But nobody can plausibly describe a quarter-million-dollar government salary as poverty.

A judge does not need clients.

A judge does not advertise.

A judge does not maintain accounts receivable.

A judge does not wonder whether enough business will arrive next month to make payroll.

Meanwhile, an electrician, plumber, contractor, physician, restaurant operator, or small lawyer may work longer hours, accept more financial risk, employ other people, and still have no assurance that he will end the year with the same income.

That inversion deserves more attention than it receives.

Republicans Have Largely Accepted the Premise

Democrats generally make no secret of their preference for an activist government. They believe government should provide retirement security, healthcare programs, education funding, environmental regulation, income redistribution, industrial policy, infrastructure, consumer protection, workplace regulation, and numerous other services.

One may disagree strongly with that philosophy, but it is at least coherent.

The more unusual development is what happened to Republicans.

The Republican Party still describes itself as the party of limited government, but “limited government” now often means a somewhat lower marginal tax rate, a slightly smaller increase in an agency budget, or elimination of a few regulations. Republicans frequently argue about how the modern administrative state should be managed rather than whether most of it should exist.

Reducing a proposed $100 billion expenditure to $90 billion may be fiscally preferable.

It is not limited government.

Virtually no mainstream national politician proposes reducing the federal apparatus by 50 percent, much less anything approaching 80 percent.

An 80 percent reduction sounds radical because today’s government is treated as the natural baseline against which every reform must be measured. Whether 80 percent is precisely the right figure is obviously a political judgment rather than mathematical truth, but the thought experiment is useful.

Start from zero.

Ask what government actually must do.

National defense.

Courts.

Protection of constitutional rights.

Law enforcement within appropriate jurisdictions.

Certain genuinely interstate functions.

Then ask which of the thousands of programs that exist today would actually be recreated if the country were designing government from first principles.

That produces a very different debate from arguing whether an existing department’s budget should increase by 4 percent or 6 percent.

The Government Ratchet

Government becomes increasingly difficult to reduce because every program creates beneficiaries. An agency employs people, those employees have families, the agency hires contractors, the contractors employ more people, and the program sends money to states, universities, nonprofits, hospitals, consultants, and local governments.

Private companies rent office space to the agency. Software companies sell it systems. Law firms handle disputes. Consultants advise administrators. Industry groups develop around its regulations.

After a program has existed long enough, an entire economic ecosystem can depend upon it.

Then somebody proposes eliminating it.

What happens to the workers?

What happens to the contractor?

What happens to the university grant?

What happens to the local government?

What happens to the community?

What happens to the beneficiaries?

Every objection may be sincere.

Collectively, however, they create a ratchet.

Government spending produces dependency, dependency produces political support for continued spending, and continued spending creates more dependency.

This is how government can expand for generations without anybody consciously voting to abolish capitalism.

Corporate Concentration Has Its Own Ratchet

Financial consolidation operates through a similar feedback mechanism. A successful acquisition produces a larger company, the larger company gains easier access to capital, and the improved access to capital makes the next acquisition easier.

Scale itself becomes an advantage.

The larger organization gains purchasing power, data, distribution, lawyers, lobbyists, financing, brand recognition, technology, and the ability to absorb regulatory costs.

The independent competitor is no longer competing merely against a better product.

He may be competing against an ecosystem.

This is what Amazon does to an independent retailer.

This is what Microsoft’s installed base does to a competing software platform.

This is what a giant financial buyer can do to an individual homebuyer.

This is what a conglomerate can do to an independent manufacturer.

At some point the founder’s realistic choices narrow.

Sell.

Remain independent against increasingly institutional competition.

Or eventually disappear.

Another independent enterprise then becomes a subsidiary, brand, franchise, marketplace seller, tenant, or portfolio asset inside somebody else’s system.

A Strange Merger of Socialism and Hyper-Capitalism

This brings us to the paradox at the center of modern Western economics.

We have not actually chosen socialism instead of capitalism.

Increasingly, we have combined elements of both.

Government taxes and spends on an enormous scale.

At the same time, financial institutions and giant corporations control pools of private capital unimaginable in earlier generations.

Government grows larger.

Corporations grow larger.

Investment funds grow larger.

Banks grow larger.

Universities grow larger.

Hospital systems grow larger.

Technology platforms grow larger.

The independent individual becomes relatively smaller.

The plumber, electrician, independent physician, small lawyer, local retailer, independent landlord, farmer, and small manufacturer confront institutions vastly larger than anything earlier generations of entrepreneurs typically faced.

This is not Marxist communism.

It is not classical laissez-faire capitalism either.

It is a system in which economic power increasingly resides in enormous public and private institutions that continuously interact with one another.

Government regulates corporations.

Corporations lobby government.

Government contracts with corporations.

Corporations administer government programs.

Government relies on Microsoft software and Amazon cloud infrastructure.

Public transit agencies integrate Uber.

Government investigates Amazon and Apple for monopoly conduct while simultaneously depending upon giant technology platforms for infrastructure.

Government subsidizes industries.

Industries employ former officials.

Officials later work for regulated industries.

The boundaries become difficult to see because the institutions themselves are intertwined.

The Common Denominator Is Dependence

This is why arguments about whether the proper label is communism, socialism, corporatism, crony capitalism, managerial capitalism, financialized capitalism, or statism eventually become less important than they initially appear.

Each label describes part of the phenomenon.

None completely captures it.

The common denominator is dependence.

Does the citizen depend upon government?

Does the company depend upon government contracts?

Does the university depend upon government grants?

Does the hospital depend upon public reimbursement?

Does the technology company depend upon government procurement or regulation?

Does government itself depend upon the technology company?

Does the franchise “owner” actually control the business?

Does the homeowner own his house or rent it from an institutional portfolio?

Does the entrepreneur win because customers chose him or because he successfully navigated institutions unavailable to his smaller competitors?

Does a historic company still exist as an independent productive institution, or does only its trademark survive inside a portfolio?

Those questions tell us more about actual economic freedom than the labels attached to the institutions.

The Most Important Form of Wealth Is Independence

Money is valuable for more than what it buys.

Money buys independence.

A paid-off house provides independence because there is no landlord deciding whether to renew the lease.

Savings provide independence because an employee can leave a bad job.

A profitable small business provides independence because income comes from many customers rather than one employer.

A diversified customer base provides independence because one customer cannot destroy the business simply by leaving.

Skills that can be sold to many different people provide independence because no single institution controls the worker’s livelihood.

The ability to earn a living without political favor provides perhaps the most important independence of all.

A healthy capitalist society should therefore want ownership to be widespread.

Millions of homeowners.

Millions of small businesses.

Millions of independent professionals.

Millions of investors.

Millions of people with savings.

Millions of people with enough capital to say no.

A society consisting increasingly of a relatively small number of enormous institutions surrounded by employees, contractors, tenants, franchise operators, marketplace sellers, borrowers, benefit recipients, and regulated subjects is different.

Private property may technically survive throughout such a society.

Economic independence may not.

This Is Not a Conspiracy

None of this requires a secret meeting.

There is no room where government officials, Amazon executives, Microsoft executives, private-equity partners, university presidents, Walmart executives, bankers, and institutional landlords gather every Thursday afternoon to decide how to control America.

That explanation is unnecessary.

Government agencies want budgets because budgets allow them to perform their missions and expand their institutions.

Politicians want reelection.

Corporations want profits.

Private-equity funds want returns.

Universities want grants.

Contractors want contracts.

Investors want yield.

Employees want security.

Consumers want cheaper products and faster delivery.

Homeowners want their property values to rise.

Each actor can behave rationally according to the incentives immediately in front of him.

The larger system emerges from those incentives.

That actually makes the problem harder, not easier.

You cannot expose a conspiracy that does not exist.

You have to change the incentives that created the system.

What Capitalism Actually Requires

Capitalism requires government.

It requires courts capable of enforcing contracts.

It requires institutions capable of protecting property.

It requires laws against fraud.

It requires public order.

It requires some mechanisms for handling genuine collective problems.

It requires national defense.

A functioning market is not anarchy.

The serious alternative to the modern administrative state is therefore not no government.

It is limited government.

A limited government can be extremely powerful within the sphere in which government is genuinely necessary.

A judge should possess enough authority to enforce a judgment.

Police should possess enough lawful authority to arrest a robber.

The military should possess enough power to defeat a foreign enemy.

None of those propositions logically implies that government must regulate, subsidize, finance, administer, or participate in thousands of aspects of ordinary economic life.

A government can possess substantial power while exercising that power within a limited jurisdiction.

That distinction has nearly disappeared from contemporary political debate.

The Real Question

So are America and Western Europe communist?

Not according to the conventional academic definition.

The government has not nationalized the means of production, private capital remains enormously important, private businesses remain real, and billions of transactions occur every day without a government official deciding who buys what.

But that answer is much less reassuring than it sounds.

The more important question is whether Western societies are evolving toward an arrangement in which nominally private ownership exists inside an increasingly dense network of taxation, regulation, government allocation, government contracting, financial concentration, platform dependence, institutional ownership, and economic interdependence.

On that question, the answer is much harder to dismiss.

Government controls enormous pools of money and determines where trillions of dollars go.

Government directly employs tens of millions of Americans.

Millions more work in private companies dependent to varying degrees upon public procurement, reimbursement, regulation, subsidies, grants, or publicly financed infrastructure.

At the same time, private economic power has become extraordinarily concentrated.

Microsoft becomes the operating infrastructure of institutional life.

Amazon becomes retail, logistics, marketplace, cloud infrastructure, entertainment, groceries, and government contractor.

Apple becomes a private governor of a technological ecosystem.

Uber starts supplementing public transit.

Walmart becomes a delivery subscription service to keep pace with Amazon.

Target becomes a logistics network.

Home Depot begins delivering hardware and construction supplies almost immediately because the customer increasingly expects everything to arrive like an Amazon package.

Private-equity firms convert operating companies into financial structures.

Historic manufacturers become brands inside conglomerates.

Restaurants sell their land and become tenants.

Franchise operators become “owners” while sharing much of the economics and control.

Single-family houses become institutional rental portfolios.

Every one of these developments can be defended individually.

Many produce genuine benefits.

The mistake is looking only at each individual transaction.

The cumulative effect is what matters.

Everything Is a Sliding Scale

There is no Tuesday morning on which capitalism suddenly turns into communism.

There is no single percentage of GDP that automatically changes the name of an economic system.

There is no single regulation that abolishes private property.

There is no single government contract that transforms Microsoft into a government agency.

There is no single Amazon warehouse that destroys independent retail.

There is no single institutional investor that converts a nation of homeowners into renters.

There is no single private-equity acquisition that destroys capitalism.

Systems change gradually.

Tax by tax.

Program by program.

Regulation by regulation.

Contract by contract.

Subsidy by subsidy.

Acquisition by acquisition.

Merger by merger.

House by house.

Brand by brand.

Platform by platform.

Eventually people look around and discover that almost everything remains technically private while remarkably little feels genuinely independent.

The house may be privately owned, but its permitted use is extensively controlled.

The company may be private, but its largest customer is government.

The government agency may be public, but its software runs on Microsoft’s private cloud.

The public transit rider may be receiving a publicly financed service through Uber.

The retailer may still be Walmart, but its logistics strategy increasingly resembles Amazon.

The restaurant may be independently operated while somebody else owns the land, somebody else owns the brand, and somebody else receives much of the economics.

The historic manufacturer may still exist as a trademark while financing, production, ownership, and strategy are controlled elsewhere.

The ordinary worker may remain technically free to choose among employers, while many of those employers themselves exist within networks of institutional dependency.

That is the paradox of the modern Western economy.

The twentieth-century communists attempted to centralize economic power by abolishing private ownership and placing productive assets directly under government control.

The modern West has found other ways for economic power to become concentrated.

Government can control enormous amounts of money without owning every company.

Corporations can control infrastructure traditionally associated with public institutions.

Financial institutions can control enormous amounts of productive property without operating the businesses themselves.

Conglomerates can own the histories and trademarks of companies they never built.

Institutional landlords can own thousands of houses without ever living in one.

Corporations can call people owners while retaining substantial portions of the underlying economics and control.

The deeds remain private.

The trademarks remain familiar.

The stock market remains open.

The restaurants still serve shrimp.

The Walmart is still open at 10 p.m.

The Amazon package is on the porch before dinner.

The Word document still opens.

The Uber still arrives.

And yet an increasing number of economically important decisions are being made somewhere far removed from the individual citizen, customer, homeowner, entrepreneur, or small-business owner.

Call that communism if you want.

Call it corporatism.

Call it state capitalism.

Call it financialized capitalism.

Call it managerial statism.

Call it a mixed economy dominated increasingly by concentrated public and private institutional power.

The terminology matters less than the underlying reality.

The fundamental question is not merely who technically owns the property.

It is who controls the money, who controls access, who makes the important decisions, and how many ordinary people still possess enough genuine economic independence to tell government, corporations, financial institutions, technology platforms, employers, landlords, and everyone else:

No. I don’t need you.

That is the measure of economic freedom that matters.

And on that measure, we have been moving in the wrong direction for a very long time.