The idea that the United States is becoming an oligarchy is no longer confined to academic debate or dystopian speculation.

As Donald Trump begins his second term in office, concerns about an American oligarchy are growing.

This is mainly due to rising wealth inequality, deregulation, and the consolidation of power among a select group of ultra-rich individuals.

In his farewell address, Joe Biden warned of the dangers of a privileged few controlling vast economic and political resources, a warning that resonated with many across the political spectrum.

This begs the question of whether the US is truly becoming an oligarchy or if this concern is overblown.

What is an Oligarchy? Applying the definition to the US

The term “oligarchy” originates from Ancient Greece, where Aristotle described it as a system where the rich rule by virtue of their wealth.

Modern examples, such as Russia and Hungary, showcase oligarchic structures where business elites directly shape governmental policies, often through corruption or coercion.

In the US, the situation is more complex. Unlike in Russia, where oligarchs control vast swathes of the economy with direct political backing, American billionaires do not officially govern.

However, they exert enormous influence through lobbying, campaign donations, and control over key industries such as finance, technology, and media.

This system, as political scientist Jeffrey Winters describes, is a “civil oligarchy”, one in which the wealthy use their financial power to shape the rules rather than govern directly.

At its core, an oligarchy is defined by economic power translating into political control. The US exhibits many of these traits, from billionaire-funded political campaigns to the deregulation of industries that benefit the elite. 

While elections still occur, the reality is that wealth increasingly dictates policy outcomes, placing the country in a precarious position between democracy and oligarchic rule.

The role of wealth inequality in shifting power

One of the key markers of oligarchy is extreme wealth inequality and in the United States, the numbers are staggering.

The richest 1% of Americans control nearly 30% of the nation’s wealth, while the bottom 50% own just 2.5%.

This gap is wider than at any point in modern U.S. history and mirrors levels seen in feudal societies rather than democratic ones.

This concentration of wealth grants immense power to a small group of individuals who can influence elections, shape policy, and, in some cases, dictate government agendas.

The Citizens United ruling, which allows unlimited corporate and individual spending in political campaigns, has only made things worse.

The result? A system where public policy often reflects the interests of the ultra-wealthy rather than the majority of citizens.

Under Trump’s second administration, this divide is expected to widen further.

His economic policies prioritise deregulation, tax cuts for the wealthy, and protectionist trade policies, all of which benefit billionaire elites at the expense of the middle and working classes. 

The question is no longer whether wealth influences politics—it is to what extent democracy can function when financial power is so disproportionately distributed.

How Trump’s second administration embodies oligarchic politics

Trump’s presidency has historically been characterized by an unprecedented alliance between political power and economic elites. His second term is no different, with a Cabinet and advisory circle composed of three key factions:

First, the conservative mainstreamers, including figures like Treasury Secretary Scott Bessent and National Economic Council Director Kevin Hassett, aim to maintain some economic stability.

However, they have largely embraced Trump’s protectionist stance, supporting tariffs and deregulation while ensuring Wall Street interests remain safeguarded.

Next, the America Firsters, led by figures like Stephen Miller and Peter Navarro, push for aggressive nationalist policies, including high tariffs, strict immigration controls, and economic isolationism.

Their vision aligns with Trump’s strategy to reshape America’s economic and foreign policy through protectionist measures that benefit select industries while limiting international competition.

Finally, the tech tycoons, the likes of Elon Musk, David Sacks, Mark Zuckerberg and Marc Andreessen. All of them now seek to dismantle government oversight while cementing corporate dominance over key industries.

Musk, in particular, has been granted significant influence through his leadership of the Department of Government Efficiency (DOGE), a newly created agency designed to shrink federal bureaucracy.

These three factions do not always align, but collectively, they represent a shift toward an economic system where power is increasingly concentrated in the hands of a wealthy elite.

According to recent reports, the estimated net worth of Trump’s administration could be more than $20 billion.

Is Silicon Valley the new “oligarchic class”?

While traditional oligarchies have been built on industries like oil, banking, and natural resources, the 21st-century version is driven by technology and data control.

Silicon Valley billionaires now wield immense influence over not only commerce but also information dissemination and national security.

Companies like Amazon, Meta, and Tesla control large and centralized digital ecosystems, which allow them to shape public discourse and public policy.

Trump’s deep ties with tech moguls have solidified their influence, with figures like Musk and Zuckerberg being given prime seating at his inauguration, symbolizing their elevated political standing.

However, the argument that the US is becoming a “tech oligarchy” is flawed.

Unlike in Russia, where oligarchs operate as a unified bloc, Silicon Valley is rife with competition.

Musk and Zuckerberg are direct rivals in social media, while Amazon and Google battle for dominance in cloud computing and AI. 

Nevertheless, this division does not negate the fact that tech billionaires now hold more political and economic influence than ever before.

How Trump is shielding billionaire wealth

One of the most direct examples of Trump favoring oligarchic interests was his decision to scrap Biden’s global tax reform. 

Originally, this initiative aimed at establishing a 15% minimum corporate tax rate worldwide, in order to curb multinational tax avoidance and ensure that companies like Amazon and Meta paid their fair share. 

The reform was not just about revenue collection; it was a foundational attempt to curb the ability of billionaires and corporations to manipulate global tax laws to their benefit.

It sought to prevent powerful multinational entities from shifting profits to tax havens, effectively starving nations of public funds essential for infrastructure, healthcare, and education.

Trump’s rejection of the deal was not a surprise but rather a calculated move to further entrench the wealth of America’s billionaire class.

By dismantling the global framework, he ensured that American tech giants could continue leveraging offshore loopholes to shield their fortunes.

While European nations and developing economies struggle to maintain financial stability, the US remains an enabler of wealth hoarding on an unprecedented scale.

Without coordinated global action, billionaire-backed corporations will continue to consolidate economic and political power, deepening the already stark divide between the ultra-wealthy and ordinary citizens.

This is also one of the reasons that the US stock market has performed so well over the past decades, in comparison to emerging markets.

Is America at risk of becoming a full oligarchy?

While the US remains a flawed democracy, the growing consolidation of wealth and power poses an undeniable risk.

The line between democracy and oligarchy is becoming increasingly blurred. 

Elections may still occur, but when billionaire-backed candidates dominate the political landscape and policy decisions favor corporate interests over the public good, what remains of democratic governance?

The unchecked influence of money in politics has eroded public trust, while regulatory agencies have been systematically dismantled to serve the elite. 

If the current trajectory continues—where corporate lobbying dictates legislation, wealth inequality deepens, and political accountability weakens—then America will no longer be “approaching” oligarchy; it will have fully embraced it. 

The battle for democracy is ongoing. Whether the U.S. fully succumbs to oligarchic rule or fights back against elite dominance will depend on public pressure, policy reform, and a renewed commitment to economic justice.

If unchecked, however, the warning signs are clear: America is inching closer to a reality where the ultra-wealthy no longer just influence politics—they control it.

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The economic landscape of Europe is marked by a delicate balance as recent inflation data presents a mixed picture, particularly in France and Germany.

While French inflation has unexpectedly remained steady, data from German regions indicates a slowdown, collectively prompting traders to increase their bets on the European Central Bank (ECB) implementing further interest rate cuts.

French prices remain stable: a surprise in the Eurozone

Consumer prices in France rose by 1.8% year-on-year in January, according to the statistics agency Insee, matching the reading from December.

This figure defied analysts’ expectations from a Bloomberg survey, which had predicted a 1.9% increase.

Meanwhile, German regional data revealed varied figures, with the country’s two largest states reporting inflation at 2% and 2.5%, respectively.

This divergent data suggests a complex landscape for the Eurozone’s monetary policy.

ECB reiterates disinflation progress amidst lingering services pressures

These figures come shortly after the ECB reduced its deposit rate by a quarter-point for the fourth consecutive meeting, bringing it down to 2.75%.

The central bank reaffirmed its assessment that the disinflation process across the continent is “well on track,” although they acknowledged persistent pressures within the services sector.

ECB policy stance poised for shift in March

As inflation levels move significantly away from the double-digit highs of 2022, officials are reportedly considering dropping the term “restrictive” to describe their policy stance as early as the next meeting in March.

This potential shift comes as the ECB attempts to strike a balance between taming inflation and supporting economic growth.

President Christine Lagarde has continued to avoid offering concrete guidance on borrowing costs this week but reaffirmed that a clear direction of travel is in place.

Market reaction: bets on further rate easing surge

In response to Friday’s inflation data, traders significantly increased their bets on further rate easing by the ECB.

Money markets are now pricing in 83 basis points of rate cuts in 2025, up from approximately 70 basis points earlier in the day.

Elsewhere, the euro experienced a 0.2% drop against the dollar, falling to $1.037, while European bonds rallied.

German two-year yields fell by nine basis points, reaching 2.12%, illustrating the market’s anticipation of a shift in monetary policy.

Upcoming data and consumer sentiment

Later on the same day, January’s inflation data for Germany as a whole is expected to remain steady at 2.8%.

The full 20-nation Eurozone report will be released on Monday, with a Bloomberg Economics nowcast indicating a potential acceleration to 2.6%.

However, an ECB survey of consumers released on Friday revealed caution remains necessary; expectations for inflation over the next 12 months increased for a third consecutive month to 2.8% in December, while remaining unchanged at 2.4% for three years ahead.

Forecasts and wage growth

Professional forecasters have also increased their estimates for price growth this year, according to another poll by the central bank, although longer-term expectations remain anchored around 2% through 2027.

Further, data suggests that slower growth in workers’ pay should aid in keeping inflation in check; a separate ECB survey indicated that companies expect wage gains to ease in both 2025 and 2026.

ECB official sees inflation target within reach

“The momentum of price increases in the euro area is fading,” ECB Governing Council member Madis Muller stated in a blog post on Friday.

It is entirely realistic that by the middle of this year, price increases in the euro area will be very close to the central bank’s target of 2%.

In France, price increases were driven by increases in energy and manufactured goods.

The services gauge slowed to 1.9%, marking its lowest reading in more than three years.

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North American businesses, consumers, and farmers are bracing for a major economic shake-up as former US President Donald Trump prepares to impose 25% tariffs on imports from Canada and Mexico.

The move, set to take effect from Saturday, threatens to disrupt nearly $1.6 trillion in annual trade, escalating tensions between the three economic powerhouses.

Trump’s decision is driven by demands for stricter immigration controls and tougher measures against fentanyl trafficking—issues he claims are critical to US national security.

However, the looming tariffs could trigger significant price hikes on essential goods, from food to automobiles, while sparking retaliatory measures from America’s trading partners.

Uncertainty over implementation and economic fallout

Despite Trump’s firm deadline, industry experts remain uncertain about whether the full 25% tariff will be imposed immediately or rolled out gradually.

The White House has indicated that even if announced, the tariffs may require a two-to-three-week notice period before US Customs and Border Protection can begin collections.

Businesses and trade groups are closely monitoring whether negotiations with Canada and Mexico could lead to a delay or potential exemptions.

The economic impact of these tariffs is expected to be severe.

The North American supply chain is deeply integrated, particularly in industries like automobiles, agriculture, and energy.

Automakers, for example, rely on cross-border supply routes where parts move between countries multiple times before final assembly.

Economists warn that higher import costs could translate to increased prices for consumers and potential job losses in the US.

Canada and Mexico prepare for retaliation

Both Canada and Mexico have signaled they will not sit idle if Trump enforces these tariffs.

Ottawa has reportedly drawn up a detailed retaliation plan, targeting US exports such as Florida orange juice—a move aimed at hurting key political constituencies.

Canada has a broader list of up to C$150 billion in US imports that could be subject to countermeasures.

Meanwhile, Mexico has warned that the tariffs could cost 400,000 American jobs, particularly in industries that rely on affordable Mexican imports.

Mexican President Claudia Sheinbaum has expressed skepticism over whether Trump will follow through with the tariffs, hinting that the move may be more of a political strategy than an economic necessity.

Trump’s use of emergency powers to enforce tariffs

To fast-track the tariffs, Trump is expected to invoke the International Emergency Economic Powers Act (IEEPA), a statute originally passed in 1977 and expanded after 9/11 to grant the president broad authority to impose economic sanctions.

This strategy would allow Trump to bypass lengthy investigations typically required under trade laws.

Trump’s top trade adviser, Peter Navarro, defended the tariffs, arguing that revenue from them could help fund an extension of Trump’s 2017 tax cuts, which are set to expire this year.

However, critics argue that the tariffs act as a tax on American consumers and businesses, as importers pass on the increased costs through higher prices.

Global trade tensions on the rise

Beyond North America, Trump has also floated a 10% tariff on Chinese imports, citing Beijing’s role in fentanyl trafficking as a justification.

While China has remained cautious about its response, its embassy in Washington has warned the US not to take its “goodwill for granted.”

If Trump enforces these tariffs, he risks igniting a fresh trade war that could have global repercussions.

During his first term, similar moves led to aggressive countermeasures from China and the European Union, affecting industries from agriculture to motorcycles.

Will Trump back down?

Despite the aggressive rhetoric, some analysts believe Trump may announce the tariffs but suspend their enforcement, using them as leverage in negotiations with Canada and Mexico.

However, others warn that repeated threats without action could weaken Trump’s credibility on trade enforcement.

With the stakes higher than ever, businesses and investors remain on edge, watching closely for Trump’s next move in what could become one of the most consequential trade battles of the year.

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Elon Musk’s Department of Government Efficiency (DOGE) representatives have reportedly requested to gain access to US Treasury payment systems, triggering a significant clash with senior Treasury official David Lebryk.

According to a report by the Washington Post on Friday, this disagreement led to Lebryk’s decision to depart from his position.

Sources familiar with the situation stated that the dispute centered around the Treasury’s sensitive payment system, which processes over $6 trillion annually in payments such as Social Security and Medicare benefits, federal salaries, government contracts, and tax refunds.

The reasons behind DOGE’s interest in accessing this system remain unclear.

A DOGE spokesperson declined to comment when contacted by the Post, and representatives from the US Treasury Department also did not respond to requests for further details.

The report indicated that Lebryk, who has held nonpartisan positions within the department for decades, is expected to leave soon but did not specify an exact timeline.

In related news, Scott Bessent was confirmed by the US Senate on Monday to serve as Treasury Secretary under President Donald Trump.

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