Vulture Capitalism: Corporate Crimes and the Death of Freedom

Modern corporations are not merely economic entities, but political entities without democratic accountability

Grace Blakeley‘s Vulture Capitalism critiques the alliance of corporations, finance, and states underpinning the capitalist system that drives inequality, stifles democracy and enriches elites. Brilliantly combining theory, analysis and practical solutions in engaging prose, this book offers a blueprint for reclaiming power through economic democracy, writes Hans Despain.

Watch a recording of Grace Blakeley’s lecture at LSE on 13 January 2025 on YouTube

Grace Blakeley: Vulture Capitalism: Corporate Crimes, Backdoor Bailouts, and the Death of Freedom

Reviewed by Hans G Despain

Populist movements across the globe have expressed a chorus of complaints that national and international political economies are not being governed for the benefit of citizens. Instead, it seems that a narrow segment of wealthy, well-connected insiders reap the greatest gains during economic booms and are safeguarded and bailed out following a bust. Meanwhile, massive costs are imposed on everyone else.

Grace Blakeley’s new book Vulture Capitalism: Corporate Crimes, Backdoor Bailouts, and the Death of Freedom provides a narrative that substantiates the populist sentiment. Indeed, she argues the logic of capitalism necessarily generates concentration of economic power. This concentration has been used to centralise political power, which in turn is used to pass regulations and policies that are highly favourable to Goliath multinational corporations and Titan financial institutions and further increase economic power. Blakeley is inspired and informed by a plethora of recent economic literature documenting the “death of competition,” rise of a “new gilded age” and “new monopoly capitalism.” It is a “war between monopoly power and democracy,” whereby it is argued oligopoly “competition is killing us.”

Hundreds of economic studies have shown corporate concentration has increased persistently over the past century. The bulk of these have been conducted by advocates of capitalism concerned with the diminishing degree of competition and the lack of enforcement of anti-trust laws in recent decades. Blakeley embraces the mainstream concerns of economic concentration generating higher prices, fewer start-ups, lower productivity, less investment, lower wages, increasing income and wealth inequality, political polarisation, and withering democracy. However, she contends that monopoly power and economic concentration is an ontological feature of capitalism.

Blakeley argues that it is a categorical error to identify the differentia specifica of capitalism as free markets. First, this is because, as most recently argued by David Graeber, all human societies have markets and exchange. Second, markets in capitalism are not necessarily “free,” but instead managed and planned. Thus, the notion of “free market” capitalism is a rhetorical smokescreen, behind which lies the brutal, despotic power of Goliath corporations (29). Third, Blakeley fully embraces David Graeber’s “iron law of liberalism,” which contends that any extension of market activity, rather than reducing bureaucratic red tape, invariably increases regulations, the total amount of paperwork, and the total number of bureaucrats the government employs.

Part One of Vulture Capitalism brilliantly unpacks four primary insights. (1) Market exchange is not unique to capitalism. (2) The differentia specifica of capitalism is the specific relationship between employees and employers. (3) The relationship between the employee and employer is radically undemocratic, indeed totalitarian. (4) Historically, as capitalistic markets have been extended, nation-states get bigger and more involved in economic activity. For these reasons Blakeley subscribes to an insight of her mentors Leo Panitch and Sam Gindin. Namely, the nation-state needs to be placed at the centre of the search for an explanation of what makes capitalism, capitalism. In contrast to mainstream myths, neo-liberal “free market” policy does not constrain the nation-state. Instead, neo-liberal policies extend the reach of nation-state.

According to Blakeley, the treble-headed Behemoth (i.e., the nation-state, Goliath firms and Titan finance) constitutes the “planners” of the modern capitalist order. In what John Kenneth Galbraith called the “planning-system” Goliath firms no longer necessarily maximise profits nor compete with price. Instead, they “push competition into the realms of advertising, relationship-building, branding, and other tools of what Baran and Sweezy (in Monopoly Capital) call the ‘sales effort’” (110). They also predicted that the secular stagnation tendency of capitalism would necessarily (1) enlarge nation-states, fiscal intervention and government spending, (2) US military spending would become permanent, and (3) finance would explode as a percentage of GDP.

Along with the “sales effort,” modern firms tacitly collude to keep prices stable, lobby the state to reduce their tax burden, pressure the state to protect them from competition, and pressure smaller suppliers to supply big firms at a loss (e.g. Walmart and Amazon). In other words, modern corporations are not merely economic entities, but political entities without democratic accountability (124). “The relationship between banks and corporations is also extremely important” (131) for understanding monopoly capitalism. When financial institutions loan money to firms, or buy their stocks and bonds, they not only determine investment, but how societies grow and evolve. Bankers quite literally decide which companies, states, and individuals thrive and even survive. …

https://blogs.lse.ac.uk/lsereviewofbooks/2025/01/13/book-review-vulture-capitalism-corporate-crimes-backdoor-bailout-and-the-death-of-freedom-grace-blakeley/

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