I was asked about this the other day. Are people confusing oligarchy with capitalism and blaming capitalism for the excesses of oligarchy. I'm not an expert - but yes.
The problem with oligarchy is that decisions are made to benefit the oligarchs - not to benefit the proletariat. And yes - I am going to go into Marx here. His model of how capitalism functions is still the most accurate ever produced. There are several things that happen that are bad over all in an oligarchical system.
- abusing anyone is bad. There is no other justification required to demand it not happen. It's harmful. Period.
- 2nd. When the people creating capital (the workers) do not get a share of the capital they create - that is inherently abusive and therefore bad.
- 3rd - we start moving into economic issues. When workers cannot afford to consume the goods they create - the market for the goods is necessarily reduced. Businesses only exist if there are customers to purchase the goods and services being offered. No customers - no business. From a purely economic standpoint (if we ignore the moral problems with abusing people) - to create a healthy economy - we need to create consumers. Enough consumers to help fuel the economy. Paying workers too little means they don't have the means to consume basic goods and services. And this depresses the economy and collapses it. Workers must make a living wage or the economy suffers from lack of consumers as there are never enough oligarchs or bourgeoisie to fuel growth or consumption.
- 4th - hoarding of wealth means money doesn't circulate. Think of money as the lifeblood of the economy. A healthy body is one where the blood flows freely throughout the body. If blood starts pooling and collecting in one part of the body - it's a toxic life threatening situation. The same is true of wealth. It has to flow and be consumed and move in order for the economic system to be healthy. When wealth starts to accumulate and get hoarded - it's been taken out of the system entirely. You are basically draining the system of it's life blood. The money cannot be used to create more wealth or goods or services. This happens because - hoarded wealth is not being distributed to the people people who helped create the wealth and who would actually spend it - the members of the proletariat. Basically - wealthy hoarding is stealing. It's inherently abusive.
- 5th The income inequality that occurs by design in oligarchical systems creates income inequality - which is one of the leading drivers of societal violence. The more inequality there is - the more violence. The more equality there is - the less violence there is. Hoarding of wealth through oligarchy is bad not just because it restricts the flow of capital and harms the economy, and not just because it necessarily requires the exploitation of workers, but also because all of this increases the general levels of violence in society.
Oligarchies are not capitalist systems. They may look like unbridled capitalism - but a capitalist system is also a system of laws - laws that dictate the flow of capital. Oligarchies are systems of laws that allow for the hoarding of wealth - the exact opposite.
Basically- think of oligarchies as systems of legalized theft. The reason Russia has oligarchs - is they literally stole 52% of the wealth of the country - and took it out of the country. It's legalized theft. A form of kleptocracy.
Capitalist systems allow for the flow of capital. Not the hoarding of capital. Capitalist systems can be abusive, but they can also be humanistic. Wealth creation is good for everyone, assuming the wealth created is equitably distributed and used to help improve society. If wealth is created and hoarded and used to abuse - it's bad.
So - let's recognize wealth hoarding for what it is - abusive theft and start insisting that capital flow to everyone and be used to create and improve society - humanistically.