Democracy, Neoliberalism, and Financial Oligarchy

Please cite the paper as:
Daví Antunes and Marilia Tunes, (2024), Democracy, Neoliberalism, and Financial Oligarchy, World Economics Association (WEA) Conferences, No. 1 2024, Capitalism, Socialism and Democracy 80 years later, Looking at capitalism today in light of its past and possible future


Much of the legitimacy of the neoliberal order stems from the determinations that emanate from the functioning of the capitalist economy and the strength of the ideology propagated by the new cultural industry. However, in political terms, its strength is primarily based on the idea of liberal democracy.

With the fall of the Berlin Wall and the end of real socialism, the idea – initially elaborated by Francis Fukuyama – spread that American liberal democracy was the ideal political form, the only one capable of overcoming the contradictions of previous forms. The liberal democratic regime, in which the population freely chooses its representatives through periodic elections and has their individual freedoms guaranteed by law, came to be presented as the best and the freest.

Liberal democracy was believed to bring progress to all countries that adhered to it, leaving behind a past of dictatorships, underdevelopment, and totalitarianism.

The theoretical foundations of this conception of liberal democracy can be found in Capitalism, Socialism, and Democracy, whose chapters on democracy laid the groundwork for American political science. Joseph Schumpeter asserted that in a capitalist society marked by pronounced social differentiation and mass phenomena susceptible to propaganda and manipulation, it was impossible to conceive a political regime in which the population had direct participation in the main decisions of society.

In this political system, freedom was identified with competition in the market, reducing politics to the competition between parties vying for elections. Although it was justified as a value or a good, democracy came to be viewed through the lens of effectiveness, both legislatively – defining laws and overseeing rulers by professional politicians – and executively, carried out by a competent elite of technicians. They are responsible for steering the state, and, with the citizens exclusion, providing “technical solutions” to economic and social problems.

The liberal-democratic system is composed of different political parties that represent alternative societal projects and vying for power. Since the average voter lacks the knowledge and preparation to decide the course of society, the role of citizens is limited to choosing a leader and a political party for a certain period.

If dissatisfied with their choice, an individual can change their vote in the next election: the leaders of rival parties are similar to companies competing for “consumers”. For Schumpeter, democracy is not a vehicle for the betterment of humanity or a just and equitable political regime, but a market mechanism in which voters are consumers and politicians are entrepreneurs.

But since the political representation of individuals occurs through political parties, the tendency is the politics professionalization, and the parties bureaucratization. As Robert Michels had predicted in the 1920s, this process tends to limit political renewal, confining it to a competition among party leaders, while keeping the militants away from decisions and party control.

Neoliberalism’s proponents also acknowledge that the preferences of voters and representatives are entirely distinct. Voters are concerned with political proposals and how they affect their immediate interests. Candidates, on the other hand, are not interested in programs as such; they see them only as instruments for garnering votes and gaining power.

Despite many pointing out that political competition is not perfect and can be altered, distorted, and even frauded, as long as there is competition between parties, a democratic system will still exist in the view of its supporters.

However, the triumph of neoliberalism in recent decades has radicalized the primacy of individual liberties and accentuated the economic character that was already emerging in its conception, transforming not only democracy into a market but also the state itself.

Resurrecting radical political concepts, neoliberals have solidified a view of the state as an instrument for individual private ends, one that must ensure everyone’s life, freedom, and property, which are “owned” by the individual. Following Locke, they argue that there is no social body, common purposes, or ends.

Based on a purely negative conception of freedom – the absence of obstacles to choice – they argue that individuals have their own conceptions of the good and have the right to define their own life plans. Robert Nozick, a prominent neoliberal, argued that fundamental rights cannot be sacrificed in the name of a supposed common good, as only individuals have rights.

The “ethics” in a neoliberal society is, therefore, about rights, not the common good. Market principles should be the basis of government, transforming the state into a corporation managed by a “corporate” and “technical” logic that should serve the “markets” – a sovereign public space for neoliberals – where the interests and desires of consumers, which is what citizens have been reduced to, are manifested.

This technocratic conception of politics is based on faith in the market as the most efficient, fair, and meritocratic form of social organization and administration. Politics, subjugated by finance, has been decided out of public view by “independent” administrative agents.

This is the ideal political regime for neoliberals and their followers. If contemporary societies have undergone painful and continuous economic and social regressions, responsibility should be sought in the absence of reforms that adapt them to immense economic transformations and the choices made by the population, according to them. Not in the political system, which they consider the best, the freest, and the most democratic.

The thesis of this paper is that the conception of liberal democracy developed by Schumpeter and consecrated by American political science has always been characterized by concealing existing power structures, presuming that the political system is impervious to pressures from the economy and society. The economic, social, political, and cultural transformations of recent decades have undermined the remaining assumptions that supported liberal democracy. A true simulacrum, the political system has become a dictatorship of the rich.

This work highlights two aspects of this process. The unprecedented concentration of capital and power in the hands of a financial oligarchy has eliminated power alternatives, imposing its interests through control of the mass media and suppressing the debate on the great destinies of societies. At the same time, recent technological changes, along with neoliberal policies, have disorganized the labor market and the very structure of classes by eliminating numerous jobs and careers and turning work into an appendix of the social reproduction process, where jobs are intermittent and task-based. The result has been the re-emergence of a mass of rootless, undifferentiated, and depoliticized individuals with no capacity to understand contemporary political situations and organize in defense of their interests. These are the basis for the resurgence of fascist trends in contemporary societies.


ARENDT, Hannah. (2013) Origens do Totalitarismo. São Paulo: Companhia das Letras.

BENHABIB, Seyla. (2003) The Reluctant Modernism of Hannah Arendt. Boston: Rowman & Littlefield Publishers.

BOBBIO, Norberto. (1988) Diccionario de Política. Buenos Aires: Siglo Veintiuno.

BROWN, Wendy. (2019) In the Ruins of Neoliberalism – The Rise of Antidemocratic Politics in the West. New York: Columbia University Press.

CROUCH, Colin. (2021) The Knowledge Corrupters: Hidden Consequences of the Financial Takeover of Public Life. Cambridge: Polity Press.

DAHL, Robert. (2012) A Democracia e Seus Críticos. São Paulo: Martins Fontes.

CASTELLS, Manuel. (2018) Ruptura: a crise da democracia liberal. Rio de Janeiro: Jorge Zahar.

CHAUÍ, Marilena de Souza. (2019) “Breve história da democracia.” In: Democracia em Colapso? São Paulo: Boitempo/SESC.

COOK, Deborah. (1995) “The Sundered Totality: Adorno’s Freudo-Marxism.” Journal for the Social Theory Behaviour, Volume 25, Issue 2, June.

COOK, Deborah. (2001) “Adorno on Mass Societies.” Journal of Social Philosophy, vol. 32, n. 1, Spring.

COOK, Deborah. (2004) “Ein Reaktionares Schwein? Political Activism and Prospects for Change in Adorno.” Revue Internationale de Philosophie, n. 227.

CRARY, Jonathan. (2022) Scorched Earth – Beyond the Digital Age to a Post-Capitalist World. London: Verso.

CRISTI, Renato; TRANJAN, J. Ricardo. (2016) “Charles Taylor and Republican Democracy.” In: TAYLOR, Charles. Democracia Republicana – Republican Democracy. Santiago, Chile: LOM Ediciones.

EATWELL, Roger; GOODWIN, Matthew. (2018) National Populism: The Revolt Against Liberal Democracy. London: Penguin UK.

FUKUYAMA, Francis. (1992) O Fim da História e o Último Homem. Rio de Janeiro: Rocco.

LAIB, Talmon Jacob. (1952) The Origins of Totalitarian Democracy. London: Secker & Warburg.

LOCKE, John. (2019) “Segundo Tratado sobre o Governo Civil.” In: Segundo Tratado sobre o Governo Civil e Outros Escritos. Petrópolis: Vozes.

MACLEAN, Nancy. (2017) Democracy in Chains: The Deep History of the Radical Right’s Stealth Plan for America. New York: Penguin Books.

MACPHERSON, C. B. (1997) La Democracia Liberal y su Época. Madri: Alianza Editorial.

MAZZUCATO, Mariana. (2014) O Estado empreendedor: Desmascarando o mito do setor público vs. setor privado. São Paulo: Portfolio-Penguin.

MICHELS, Robert. (1982) Sociologia dos Partidos Políticos. Brasília: Editora Universidade de Brasília.

MOUNK, Yascha. (2019) O Povo contra a Democracia: Porque nossa liberdade corre perigo e como salvá-la. São Paulo: Companhia das Letras.

NOZICK, Robert. (2013) Anarchy, State, and Utopia. New York: Basic Books.

PETRUCCIANI, Stefano. (2014) Modelos de Filosofia Política. São Paulo: Paulus.

RANCIÈRE, Jacques. (2014) Ainda se pode falar de democracia?. Lisboa: KKYM.

SCHUMPETER, Joseph A. (1984) Capitalismo, Socialismo e Democracia. Rio de Janeiro: Zahar.

TAYLOR, Charles. (2016) Democracia Republicana – Republican Democracy. Santiago, Chile: LOM.

8 comment

  • Conference administrator says:

    Dear Authors,

    Thanks for your valuable contribution to the debate.

    As you mentioned, there has been a substantial amount of discussion and criticism brought about by the intertwining of neoliberalism and democracy. In your conclusion, you highlighted that the clash between democratic principles and neoliberalism raises important problems regarding the role of the state, economic power, and social justice.

    Please provide a more detailed explanation of the social forces that drive the expansion of aggressive neoliberalism today in Western socieites.

    Furthermore, considering your analysis of contemporary capitalism in Western societies, do you believe it is feasible to have a coexistence of democracy and capitalism without a market-oriented political approach?

    Maria Alejandra

    • Davi Antunes e Marilia Tunes says:

      Dear Professor Maria Alejandra,

      We appreciate your careful reading and valuable insights. In our view, we must highlight two major issues.

      On one hand, there is the growing concentration of private economic power over the State and the underprivileged. The disorganization of the Bretton Woods system and the financial opening led states to relinquish their sovereignty in favor of the financial market dictums: tax reduction; fiscal austerity policies; financial and trade liberalization that expands the space for speculative gains; social and labor rights reduction. This movement has created a vicious circle, reinforcing the dominant position of finance dominated by large American funds and banks over the rest of societies.

      On the other hand, there is the issue of public opinion. Public spaces have been progressively restricted and controlled by a cultural industry dominated by finance. Traditional public spaces such as newspapers, cafes, squares, theaters, and other types of associations are in secular decline. Traditional media, increasingly digitized, are also increasingly owned by financial funds. New media platforms like Facebook, Instagram, WhatsApp, and Big Techs are also controlled by the same funds – BlackRock, State Street, and Vanguard. For these reasons, contrary to what is propagated, new media are far from being a democratic space.

      In other words, neoliberalism undermines rights, transforms liberal democracy into a market monopolized by finance, and disseminates values adjusted to its interests. In an atomized society, with fragile social ties, unstable occupations, and uprooting, what we see is a growing anger at the lack of representativeness and against a system that does not respond to any concrete problems of people’s lives.

      This leads us to say that neoliberalism’s liberal democracy is threatened by aggressive populism that promises to destroy everything. Not surprisingly, the crisis of liberal democracy is glaring. The growth of the far right is a direct consequence of these problems.

      In summary, the problem of democracy has deep roots and involves democratic control of finance and media, which need to be subjected to the interests of the collective.

  • Germana Bottone says:

    Dear Authors,
    your interesting contribution calls to my mind the “Rodrik’s trilemma”. He affirms that democracy, national sovereignty and global economic integration are mutually incompatible: we can combine any two of the three, but never have all three simultaneously and in full. Actually, we all are prisoners of the power of wealthy.
    My simple question is: “in your opinion how could we trigger a change of course?” (a starting point, a long term solution, anything could seem a solution).
    Thanks a lot,
    Kind regards


    • Davi Antunes and Marilia Tunes says:

      Dear Germana,
      We greatly appreciate your question and your contribution.
      We believe that beyond Rodrik’s trilemma, there is a growing incompatibility between neoliberalism and liberal democracy. While it is challenging to envision a true form of democracy within capitalism, within neoliberalism, liberal democracy becomes a farce. People vote for increasingly similar parties converted to neoliberalism, which have no interest in changing anything. At most, they may grant benefits to certain social groups through targeted policies.
      As politics has been reduced to “technical” rationality, where there is no space for rights or for a dignified life for most of population, there is no longer a project for an inclusive and egalitarian society – prerequisites for the true exercise of citizenship.
      Regarding what could lead to a change of course, we would like to make two observations.
      Firstly, the rise of the far right is already a terrible change of course. The furious far-right, against immigrants, against Muslims, against minorities, defends the wealthy, but is helping to erode the political system of countries amid growing international disorder. Just think of the war in Ukraine, in Gaza, in the threats of a NATO war against Russia.
      The second is the imminent financial crisis. How far will this madness of fictitious asset valuation go? How long will it be possible to value financial wealth that McKinsey evaluates in quadrillions of dollars?
      We cannot forget that the so-called “real” economy is growing less and less, and people are facing increasing financial difficulties.

  • Arturo Hermann says:

    I totally agree with your critique of neoliberalism. The interesting issue becomes to identify which policies could promote the realisation of an equitable and sustainable economy.

  • Davi Antunes says:

    Dear Arturo,
    Thanks for your comment.
    I think that the the economic power – financial funds, asset managers and so on – and media power are too interconnected.
    This is gordian knot.
    So, we need to think in ways to tackle this power structure. I think it will pass through the mass media regulation and the democratization of the society.
    Today, it is absolutely feasible to think in a world where there is no poverty, no hungry, and no war.
    But we have a huge political problem!

  • Thomas Hinkelmann says:

    Thanks for your contribution.
    It reminds me of Samir Amin’s “stay in power” – categories ‘5 monopols’ from his book “LES DÉFIS DE LA MONDIALISATION”.
    He wrote, to “rule over others” you need enough power (monopols) in 1. technology, 2. financial flows, 3. natural resources 4. communication and media. 5. weapons of mass destruction.
    And he wrote that in a center-periphery worldsystem, the center is only as long interested in free market as it is
    advantageous for the center.
    So my question is:
    Do you think the finance oligarchy want to get and remains the new center of a world system? And is neoliberalism really the right choice for that? Or do you think they just want to create, for what reason ever, a global, or at least in the west, total free market zone, and that they ignore the risk of being to much limited by a “forced system of economic freedom only”?

  • Davi Antunes and Marilia Tunes says:

    Excellent question, Thomas Hinkelmann. We appreciate your careful reading.

    From our point of view, the financial oligarchy organized the world according to its interests. Defending the free market is not defending the departure of the State, but rather that the State stops organizing and guaranteeing rights for everyone. The State must only serve its interests, granting all the tax benefits demanded by the rich, huge interest payments and saving financial groups in the ruinous crises caused by unregulated finance.

    But this way of organizing society, in which the rich are the biggest beneficiaries and are seen as the ideal model of life, society is becoming increasingly conflictual and violent.
    As Warren Buffet said to the New York Times, “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”

    From our perspective, neoliberalism is undermining the very conditions for its support, as it increases social chaos and worsens the living conditions of the overwhelming majority of the population.
    This means bleak prospects for contemporary societies, especially in the short term.

Submit your own comment

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b>
<blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>