Twilight of Democracy: How Oligarchs Are Driving Capitalism into Fascism

From the Neoliberal Shift to a Crossroads: How Oligarchs, Inequality, and Authoritarian Trends Challenge Democracy

Since the 1980s, profound economic and social transformations have shaped Western democracies. The deregulation of markets, globalization of the economy, and rapid technological advancements initially spurred growth and new opportunities—but they also led to increasing inequalities. Wealth became ever more concentrated at the top, while income stagnated for large sections of the middle class. Modern oligarchs—ultra-wealthy individuals and families—gained growing influence over both the economy and politics. At the same time, authoritarian movements and populist forces have been gaining traction across numerous countries, offering simplistic solutions to complex problems. Independent media has come under pressure as economic elites increasingly control information channels or spread disinformation to manipulate public opinion.

Against this backdrop, Western societies now stand at a crossroads: What will the future look like? Will we continue along the same trajectory of recent decades, despite its mounting tensions? Are we drifting toward an authoritarian form of capitalism dominated by a powerful elite? Or can we revive a model of social market economy that balances economic dynamism with social justice and democratic participation? This article explores the economic evolution since the 1980s, the rise of new oligarchs, the connection between inequality and authoritarianism, and the role of media manipulation. Finally, it examines three potential future scenarios and their consequences—highlighting the necessary measures to steer the world toward a fairer, more inclusive economic model. One thing is clear: societal change is possible, and the future is not preordained. The choice remains in our hands.

Economic Developments Since the 1980s: Deregulation, Globalization, and the Middle Class

The 1980s marked a turning point in economic policy. In the United States, President Ronald Reagan, and in the United Kingdom, Prime Minister Margaret Thatcher, pursued sweeping deregulation, tax cuts for top earners, and the withdrawal of the state from key sectors of the economy. This neoliberal shift was intended to stimulate growth—but one of its key consequences was a dramatic redistribution of income and wealth toward the top. While GDP continued to rise, income stagnated for large sections of the population. In the U.S., for example, real per capita income grew by 61% between 1980 and 2014, yet this growth barely reached the bottom half of the income distribution. In 1980, the bottom 50% of Americans still earned around 20% of national income, but by 2014, their share had shrunk to just 12.5%. Meanwhile, the top 1% doubled their share from around 10% to over 20%. In other words, the wealthiest saw enormous gains, while the middle and lower-income groups barely benefited from economic expansion. Gains in productivity and corporate profits were primarily reflected in executive bonuses, capital returns, and skyrocketing top salaries rather than in broad-based wage increases.

In Europe, the trajectory was somewhat different but still favored the highest earners. Many Western European countries traditionally had stronger social safety nets and labor participation structures, yet globalization and deregulation also left their mark. Governments privatized state-owned enterprises, liberalized financial markets, and integrated their economies into global trade. The result was greater market efficiency but also downward pressure on wages and industrial employment, as companies moved production to low-cost countries. While income inequality remained lower in Europe than in the U.S., it still increased. A key distinction was that European tax systems and wage policies did not shift as dramatically in favor of top earners. Progressive tax structures remained stronger, and wage inequality was mitigated by collective bargaining agreements and minimum wage policies. This prevented the income share of the bottom 50% from collapsing as drastically as in America. European working and middle classes managed to capture at least some of the economic growth—estimates suggest that around 14% of total income growth since 1980 went to the bottom half of earners in the EU. By contrast, in the U.S., this group saw almost no real income growth, while top earners took the lion’s share.

Nevertheless, a broader trend has emerged that challenges social cohesion even in Europe: Technological disruptions—automation and digitization—have eliminated traditional middle-class jobs, with new opportunities concentrated in high-skill, high-wage sectors or precarious service jobs. The “high-wage, high-skill” jobs at the top are booming, while lower-skilled employment remains unstable. Many people feel they have lost out in globalization. In Southern Europe, the Euro crisis of the 2010s exacerbated these trends, creating mass unemployment, particularly among young people. This rising sense of social insecurity has fueled resentment against the political and economic establishment, providing fertile ground for populist and nationalist movements that seek to capitalize on economic discontent.

Modern Oligarchs: Examples and Their Influence on Economy and Politics

With the concentration of wealth comes the concentration of power. A few dozen billionaires—often referred to as modern oligarchs—now possess fortunes that surpass those of entire nations, and they use this capital to shape political decisions in their favor. In the U.S., studies have shown that policy increasingly reflects the preferences of the wealthy, while the interests of average citizens are often disregarded. A large-scale study of 1,779 policy decisions spanning several decades, conducted by political scientists Martin Gilens and Benjamin Page, found that wealthy elites and organized interest groups have a significant impact on government policy, while the preferences of average citizens statistically play no independent role. In other words, when the desires of ordinary people conflict with those of the rich, it is usually the latter who prevail. According to many observers, this has the characteristics of a “soft oligarchy”—where formal democratic institutions exist, but in practice, economic elites dictate the course of governance.

The mechanisms of this influence are varied. In the U.S., court rulings such as Citizens United (2010) removed restrictions on campaign donations, allowing billionaires to pour virtually unlimited funds into elections. A prime example is the Koch brothers’ industrial empire, which financed a vast network of lobby groups, think tanks, and political action committees to push for deregulation, corporate tax cuts, and anti-union policies. In 2021 alone, organizations affiliated with Charles and David Koch spent over $600 million on political lobbying and influence campaigns—with 93% of their expenditures explicitly aimed at shaping policies and public opinion in favor of ultra-wealthy donors. These figures illustrate the staggering financial footprint that a handful of wealthy individuals can exert on the political process.

Tech oligarchs, too, are reshaping economies and societies. Figures like Jeff Bezos (Amazon), Elon Musk (Tesla, SpaceX), and Mark Zuckerberg (Meta/Facebook) not only command massive business empires but also control key digital infrastructure—from e-commerce to satellite networks to social media platforms. Through acquisitions, they expand into critical sectors: Bezos, for instance, bought the prestigious Washington Post, while Musk acquired Twitter (now X). This gives individual billionaires direct control over information channels, enabling them to potentially influence news narratives and political discourse. Their political power is also evident in the reluctance of governments to regulate their business models—whether regarding data privacy, competition laws, or labor rights. The financial power of tech billionaires allows them to maintain a vast army of lobbyists in Washington and Brussels, while their platforms often serve as venues for their own political messaging and agenda-setting.

In Europe, the phenomenon of oligarchs exists as well, though in a different form. In post-communist Eastern Europe, the 1990s saw the rise of new economic elites through privatization and informal power networks. Some of these oligarchs—particularly in Russia—accumulated vast wealth and used it to gain political influence or even direct government control. In Western Europe, a different pattern emerged: wealthy entrepreneurs bought into the media industry and sports franchises to build prestige and political leverage. A notable example is Silvio Berlusconi in Italy, who built a private television empire (Mediaset), acquired newspapers, and used his media dominance to propel himself into politics. He served three terms as Prime Minister, often crafting laws and policies to benefit his own business interests. Berlusconi’s approach pioneered a model seen elsewhere: wealthy businessmen acquire media outlets, shape public discourse, and then transition into political office themselves.

In Eastern Europe, Hungary illustrates the deep entanglement of economic and political power. Prime Minister Viktor Orbán has nurtured a network of loyal business elites, who have acquired much of the country’s media landscape in recent years. Today, Hungary’s major television networks, radio stations, and newspapers are controlled by a handful of oligarchs, all closely aligned with the government. Independent media outlets have been pushed out or absorbed, while state-friendly platforms dominate the public narrative. Similar developments can be seen in other countries: in the Czech Republic, billionaire Andrej Babiš acquired major newspapers before becoming Prime Minister. These cases highlight how economic elites in Europe wield influence, whether through behind-the-scenes lobbying and campaign donations or by stepping directly into political leadership.

Modern oligarchs in both the U.S. and Europe take many forms: tech magnates, financial moguls, media barons, and former post-communist tycoons. What unites them is that their extraordinary wealth grants them disproportionate access to power, distorting both democratic decision-making and economic competition. When a handful of individuals accumulate excessive influence, the free market ceases to function as an open, competitive system—instead, it degenerates into crony capitalism, where policies are for sale, and corporations dictate regulations.

Inequality and Authoritarian Movements: The Fertile Ground of Economic Hardship and Social Insecurity

Rising economic inequality is not just a social or moral issue—it has tangible political consequences. Historical and contemporary examples suggest that severe economic crises and middle-class anxieties about downward mobility create fertile ground for authoritarian and extremist movements. The mechanism behind this is simple: When large portions of the population feel abandoned by the system and see no future within it, they become more willing to embrace radical alternatives that promise quick and easy solutions—even at the cost of personal freedoms or democratic norms.

A historical perspective makes this link clear. The Great Depression of 1929 triggered mass unemployment and social devastation in many countries. In Germany, for example, the unemployment rate skyrocketed to over 30% in the early 1930s. In such desperate circumstances, extremist parties like the National Socialists successfully redirected public frustration and anger into support for an authoritarian regime. Hitler promised work and bread, blamed scapegoats (such as Jews and other minorities) for economic hardship, and offered a narrative of national rebirth—with catastrophic consequences. A similar scenario unfolded in Italy, where Benito Mussolini leveraged postwar economic collapse and societal fear to dismantle democracy. Historians emphasize that the combination of economic misery (inflation, unemployment, poverty) and national humiliation made people susceptible to the false saviors who offered authoritarian rule. Without the economic turmoil of the 1930s, the rise of fascism would have been far less likely.

Even in modern times, economic shocks often coincide with shifts to the political right. Empirical research spanning centuries supports this pattern. A study examining 15 major financial crises between 1870 and 2014 found that, on average, far-right parties increased their vote share by approximately 30% after a financial crisis hit a country. At the same time, political polarization and government instability worsened. The 2008 global financial crisis provided a clear example of this phenomenon. In Greece, economic collapse and austerity measures shattered the traditional party system, paving the way for both left-wing (Syriza) and right-wing (Golden Dawn) movements. In Spain, economic turmoil gave rise to the leftist Podemos party, while in Italy, the populist Five Star Movement and the far-right Lega surged in popularity. In France, Marine Le Pen’s far-right National Front (now Rassemblement National) reached the 2017 presidential runoff, fueled by protest votes from economically struggling regions. In the U.S., economic stagnation, industrial decline, and Wall Street bailouts fueled frustration among working-class voters, paving the way for Donald Trump’s 2016 victory on a wave of nationalist rhetoric and promises to restore lost prosperity.

Social insecurity plays a crucial role in all of these cases. When people fear for their jobs, worry about slipping out of the middle class, or believe that “those at the top” are enriching themselves while “the little man” is left behind, the appeal of politicians promising radical change grows stronger. Authoritarian populists exploit these fears, presenting themselves as champions of the “forgotten people” while blaming outsiders—whether immigrants, foreign powers, political “elites,” or minorities—for economic decline. In this way, economic frustration is transformed into political radicalization.

However, it is essential to recognize that inequality alone does not automatically lead to authoritarianism—economic hardship often interacts with cultural and social factors. Many citizens feel both economically left behind and culturally alienated due to rapid societal change (globalization, immigration, shifting social values). The combination of status anxiety and identity crises can be politically explosive. Yet, economic precarity is often the initial spark. In former industrial regions where factories have shut down without viable replacements, local populations become more receptive to political narratives that offer a return to past stability and security. Studies show that in the U.S., areas with high industrial job losses disproportionately voted for Trump, just as in Germany, economically struggling regions in the East are strongholds for the far-right AfD. While multiple factors influence voter behavior, the pattern remains clear: economic distress erodes trust in established political forces and can destabilize democratic institutions.

Media Control, Disinformation, and the Manipulation of Public Opinion

Another major threat to democracy in the shadow of inequality and oligarchic power is the deliberate shaping of public opinion through media control and disinformation. In modern mass societies, media largely define how citizens perceive reality—what they see as problems, whom they blame, and which solutions they consider plausible. When control over these media rests in the hands of a few economic elites, they can shape the information landscape to serve their interests.

Over the past few decades, there has been a dramatic consolidation of media ownership. In the United States, about 90% of traditional media (newspapers, television, and radio stations) are now owned by just six major corporations. In the 1980s, this landscape was divided among around 50 media companies. This concentration of ownership, enabled by deregulated media markets and generous merger approvals, means that a handful of corporate executives now decide what information reaches millions of people every day. When the owners of these media empires are billionaires with clear political agendas, conflicts of interest can arise between journalistic independence and the business or lobbying interests of media proprietors.

One clear example is Rupert Murdoch, the Australian-American media mogul who built a vast empire (News Corp, 21st Century Fox) that includes powerful outlets like Fox News in the U.S. and newspapers such as The Sun and The Times in the UK. Murdoch’s media have frequently pushed a conservative, pro-business agenda and openly backed political candidates. His tabloids played a critical role in shaping public opinion in favor of Brexit, while Fox News became a key amplifier of Donald Trump’s messages in the United States. Studies in media science have repeatedly shown that when new owners with strong ideological views take over media outlets, editorial lines often shift noticeably. The impact of such concentrated media power on elections and public discourse cannot be overstated.

Beyond media ownership, the rise of disinformation as a tool of manipulation further exacerbates the problem. Social media platforms like Facebook, YouTube, and Twitter allow messages to reach millions without traditional journalistic filters. Economic and political elites have recognized this opportunity and exploit it to shape public opinion in their favor. In some cases, wealthy foundations or individuals secretly fund disinformation campaigns—for instance, to cast doubt on scientific findings that threaten their business interests.

One well-documented example is climate change denial. For decades, major oil and coal corporations, led by billionaire-backed networks such as those of the Koch brothers, have funneled vast sums into think tanks and pseudo-expert groups designed to sow skepticism about climate science. The goal was to delay environmental regulations and protect fossil fuel profits. This carefully orchestrated manufacturing of doubt and false narratives meets all the criteria of disinformation—funded with millions of dollars yet disguised as legitimate debate. Similar tactics have been used in the finance and pharmaceutical industries to block tighter regulations.

Meanwhile, authoritarian leaders use direct media control and propaganda to maintain power. In Russia, oligarchs close to the Kremlin control most major television networks, ensuring that oppositional voices are marginalized. In Hungary, Viktor Orbán’s government has leveraged a network of loyal business allies to dominate the media landscape, effectively eliminating independent journalism. As a result, most Hungarians receive news filtered through a government-friendly lens, creating an illusion of public consensus. Even in formal democracies, indirect media control can occur—for example, when governments reward media-friendly business figures with broadcasting licenses or pressure critical outlets by manipulating public advertising budgets.

Disinformation is particularly effective in societies experiencing uncertainty and economic hardship. Under such conditions, conspiracy theories, false blame-shifting, and simplistic narratives gain traction. Economic elites can exploit these vulnerabilities to redirect public anger away from structural causes and onto scapegoats. For example, instead of acknowledging corporate decisions or insufficient government policies as the real drivers of job losses, media narratives can shift public frustration toward “foreign competitors” or immigrants. This kind of manipulated discourse weakens democracy’s ability to address challenges rationally. When large segments of the population are misled into believing that inequality and economic distress are caused not by corporate exploitation or political inaction, but by outsiders or marginalized groups, the demand for real reforms dissipates.

By obscuring the true sources of societal problems and fostering division, economic elites preserve the status quo—a system that continues to benefit them while leaving the broader population fragmented, misinformed, and politically disengaged.

Future Scenarios: Oligarchic Continuity, Authoritarian Transformation, or a Revival of Social Market Economy?

Given these developments, three broad future scenarios emerge, each carrying distinct economic and political consequences. It is important to emphasize that which scenario unfolds will largely depend on the choices societies make. None of these outcomes are inevitable. Precisely because alternatives exist, it is worth examining these possible trajectories more closely—and considering which strategic decisions would be necessary to set the course for a preferable future.

Scenario 1: Business as Usual – Deepening Inequality and Oligarchic Consolidation

In the first scenario, the trajectory set in the 1980s continues largely unchanged. The current trends—increasing concentration of wealth and market power, stagnant incomes for the majority, and weak regulatory intervention—persist. Economically, this would likely mean that growth continues, but remains unevenly distributed. Studies suggest that under a “business as usual” model, even by the middle of the 21st century, the lower-income half of the global population would see little economic improvement, while the global elite would continue to amass wealth disproportionately. The World Inequality Report warns that without course corrections, the poorest 50% of the population worldwide will see minimal income gains, while the wealthiest will capture the vast majority of economic growth. In other words, the wealth gap would continue to widen.

The political consequences of this scenario would be a further erosion of trust in democracy. If the middle class stagnates or declines while a small elite becomes ever wealthier, dissatisfaction will inevitably rise. Surveys already paint an alarming picture: in many Western countries, trust—especially among younger generations—that democracy represents their interests is declining. If this trend persists, alienation from democratic institutions could reach extreme levels. Democracy might formally persist, but an increasing number of citizens would see it as a façade behind which oligarchs pull the strings. Protest votes, polarization, and political instability could intensify—not just as temporary disruptions, but as a long-term pattern.

Simultaneously, oligarchic structures could become more entrenched. Wealthy elites would use their influence to block reforms that threaten their position, such as higher taxation or stricter antitrust laws. Politics could fall into paralysis, with endless disputes but no real solutions to pressing social issues. This would, in turn, threaten the very foundation of economic stability: Extreme inequality weakens overall economic demand (as mass purchasing power declines) and increases financial instability.

In short, Scenario 1 represents a continuation of the “neoliberal” present, but one that grows increasingly unsustainable. It could lead to a kind of “stagnant oligarchy”, where a wealthy elite retreats into exclusive enclaves, while the majority faces rising insecurity and declining opportunities.

Scenario 2: Authoritarian Capitalism – The “Strong Hand” in Alliance with the Elites

In this second scenario, authoritarian forces gain the upper hand. Frustrated by democracy’s apparent inability to resolve mounting crises, more citizens may turn to strong leaders who promise to “clean up” in the name of the people. However, history and current trends suggest that authoritarian regimes often work hand in hand with certain economic elites, creating a system of “authoritarian capitalism”—where political freedoms are lost, but the wealth and power structures of the upper class remain largely intact.

This scenario could unfold gradually, through the election of populist governments that systematically dismantle democratic institutions—eroding judicial independence, suppressing free media, and undermining parliamentary oversight, as seen in Hungary or Turkey. Alternatively, it could emerge suddenly, triggered by a political crisis or state of emergency used as a pretext to suspend democracy.

Economically, authoritarian states often portray themselves as the “saviors” of a struggling middle class. Initially, they may introduce popular measures such as large infrastructure projects, crackdowns on perceived “corrupt elites,” or restrictions on foreign competitors, to signal decisive action. However, without democratic accountability and a free public discourse, corruption and cronyism tend to escalate rather than decrease. Authoritarian regimes frequently channel economic resources to loyal supporters, whether the military, party loyalists, or oligarchs allied with the regime. The rule of law is weakened, meaning contracts and property rights hold only as long as one remains in the good graces of those in power. This creates an unpredictable investment climate, stifling innovation and long-term economic growth.

Politically, the consequences of Scenario 2 would be severe: civil rights and freedom of expression would be curtailed, opposition forces suppressed, and the public sphere tightly controlled through state-aligned media. Nationalist rhetoric could dominate public discourse, shifting attention away from domestic economic problems toward external enemies or internal scapegoats. To some, this might initially feel like “stability,” as visible dissent decreases. However, this artificial order is often maintained through repression.

At the same time, the root causes of discontent—such as social inequality—would persist or even worsen. Authoritarian regimes rarely engage in meaningful wealth redistribution; they simply replace or reconfigure the ruling elites. Over time, economic stagnation and crisis become more likely, which triggers even greater repression to maintain control. Russia provides a case study in this type of authoritarian capitalism, where state-controlled industries, political patronage, and crackdowns on dissent created a temporary illusion of stability, but failed to generate sustainable innovation or economic progress.

Furthermore, authoritarian regimes often resort to aggressive foreign policies to maintain domestic legitimacy, escalating conflicts with external rivals to rally nationalist support. In the worst-case scenario, this could lead to heightened geopolitical tensions or even military conflicts.

In summary, Scenario 2 leads to a world where democracy and freedoms are sacrificed without actually solving the underlying social issues. While some may be drawn to authoritarianism’s promise of quick and decisive action, history teaches us that these “strongman experiments” rarely end well.

Scenario 3: A Revival of Social Market Economy – Economic Renewal with Social Justice

The third scenario presents an alternative to both oligarchic stagnation and authoritarianism: a deliberate effort to reinvigorate the principles of the social market economy and adapt them to the 21st century. In this path, policymakers and society recognize the urgent need for reforms to bridge the growing divide between social classes, ensure fairer economic distribution, and reinforce democratic resilience.

What would a revitalized social market economy look like? At its core, it would maintain free markets as drivers of innovation and prosperity but introduce stronger regulations to curb excesses and ensure that economic growth benefits the majority rather than just a privileged few. Several key reforms would be necessary to achieve this balance:

• Tax and Fiscal Reforms: A progressive taxation system on high incomes, corporate profits, and large fortunes would be crucial. Over the past decades, top tax rates and corporate taxes have been slashed, exacerbating wealth concentration. Reintroducing fair taxation could generate revenue for public investments and curb extreme inequality. Wealth taxes or inheritance taxes could prevent dynastic fortunes from growing unchecked while ensuring that economic success benefits society as a whole. International cooperation would be necessary to close tax havens and prevent a race to the bottom in corporate taxation. Even institutions like the OECD and IMF now acknowledge that redistributive taxation is essential to maintaining social stability without harming economic growth.

• Strengthening Social Security and Public Services: A strong middle class requires access to high-quality education, healthcare, and a stable retirement system. Investing in public education—from early childhood to higher education—would promote social mobility and prevent economic privilege from being inherited across generations. Vocational training programs could help workers adapt to technological shifts, ensuring that automation and AI do not simply displace jobs, but also create new opportunities. A well-funded healthcare system and retirement security reduce the fear of economic collapse, which in turn stabilizes societies and reduces susceptibility to extremist narratives.

• Labor Market and Workers’ Rights: Reviving social market principles would also mean empowering workers. Higher union membership, collective bargaining protections, and fair minimum wages have historically led to broader wage growth and less inequality. Policies could facilitate unionization in digital and service industries and expand worker participation in corporate decision-making. Concepts such as shorter working hours, a universal basic income, or guaranteed employment programs could be explored to reduce economic insecurity and provide stability amid technological change.

• Competition Policy and Regulation: Markets remain dynamic only when competition exists, and monopolies are kept in check. Stronger antitrust laws and active enforcement—particularly against tech giants—would prevent a handful of corporations from controlling entire sectors. Breaking up monopolistic structures, particularly in digital markets, could allow smaller businesses and startups to thrive, fostering true innovation. Additionally, financial markets should be kept under stricter oversight to prevent speculation-driven crises—a lesson that must not be forgotten after 2008. Moreover, regulation should align economic policy with long-term sustainability goals, ensuring that prosperity does not come at the expense of ecological stability.

• Democratic Reforms and Transparency: To prevent economic elites from hijacking political processes, reforms in campaign financing, lobbying, and political representation would be necessary. Stricter limits on campaign donations, increased transparency in lobbying activities, and publicly funded elections could reduce the influence of corporate money in politics. Citizen assemblies and direct democratic instruments could help ensure that policymaking reflects the needs of broader society rather than the interests of a few. Media diversity protections and robust public broadcasting institutions would counterbalance the dominance of billionaire-owned media and fight disinformation.

What would be the impact of this scenario? Economically, a fairer distribution of income would stimulate domestic demand, as more people would participate in wealth creation and consumption. Socially, a stronger safety net would reduce economic anxieties, making societies less prone to polarization and extremist rhetoric. A new social consensus could emerge—similar to the post-war decades, when broad segments of the population felt invested in economic progress and democratic institutions. Studies indicate that countries with lower inequality experience less political polarization and enjoy higher trust in institutions—both essential for a stable democracy.

Of course, implementing such reforms would face challenges: How can these changes be enacted in a globalized economy? Would capital and high-income earners flee if one country pursued redistribution alone? This underscores the necessity of international cooperation. A revival of the social market economy would ideally be a coordinated effort—for example, through the EU, the G7, or G20. Recent agreements, such as the push for a global minimum corporate tax, prove that coordinated reforms are feasible when there is political will.

Ultimately, even some within the economic elite acknowledge that extreme inequality poses a systemic threat. A pragmatic coalition of progressive policymakers, socially responsible businesses, and engaged civil society could help forge a new economic pact—one that recognizes that inclusion and fairness are not barriers to prosperity, but its foundations.

No Fate, But a Call to Action

The developments of recent decades may create the impression that the growing gap between rich and poor, the power of oligarchs, and the rise of authoritarianism are inevitable consequences of economic laws. But analysis shows this is not the case. Social change is possible, and the course for the future is in our hands. Neither unchecked oligarchic turbo-capitalism nor a slide into autocracy is an unavoidable outcome—these would be the consequences of inaction. At the same time, we can choose a different path, one that builds on the successes of the social market economy and adapts it for the 21st century.

Achieving this requires courage and political determination—the willingness to implement difficult reforms and confront powerful vested interests. But history proves that democracies can correct their course when enough people demand it. From the New Deal in 1930s America to the post-war economic order in Western Europe and the more recent successes of the Scandinavian model, there are clear examples of how societies have rebalanced wealth, strengthened democratic institutions, and expanded prosperity. Today’s elites and oligarchs are not omnipotent—their influence depends on whether the majority passively accepts their dominance or actively challenges it—through democratic processes.

The key to change is whether a new narrative of hope and solidarity can emerge, one that breaks through the fatalistic belief that ‘there is no alternative’. Since disinformation and media bias are significant obstacles, it is essential to widely discuss facts and analyses like those presented in this article. When citizens understand the links between inequality, democratic decline, and their own economic struggles, pressure on policymakers to act will increase.

The future is still undecided. It can be shaped by a small elite—or by the democratic majority. Achieving the latter requires collective effort, but it is worth it. A revitalized social market economy, adapted to modern challenges, could prove that shared prosperity is possible without sacrificing freedom. The final decision has not yet been made. It depends on us—in elections, in civic engagement, in the workplace, in public debates.

The current situation may be critical, but this moment also presents an opportunity to renew and strengthen democracy. Stagnation is the only true inevitability—and we don’t have to accept it. The path forward is still open, and the sooner we act, the greater the chance that Scenario 3 becomes reality: a fairer, freer, and more resilient society.

Sources:

•Piketty, T., Saez, E., & Zucman, G. (2018). Distributional National Accounts: US, 1980-2014. World Inequality Report 2018 – Data showing income shares of the top 1% vs. bottom 50%.

•World Inequality Lab (2018). World Inequality Report. Findings on inequality trends in the US vs. Western Europe since 1980.

•Gilens, M. & Page, B. (2014). Testing Theories of American Politics. Perspectives on Politics (Study on political influence of different income groups).

•Koch Network – Center for Media and Democracy (2023). Report on financial influence of the Koch network on politics.

•Fukuyama, F. (2020). 30 Years of World Politics: What Has Changed? Journal of Democracy (Analysis of oligarchic media influence in Italy/Hungary).

•Funke, M., Schularick, M., & Trebesch, C. (2016). Going to Extremes: Politics after Financial Crises, 1870-2014. (Study showing increased far-right electoral success after financial crises).

•Lempinen, E. (2024). Fascism shattered Europe a century ago — echoes today in the U.S. (Historical parallels between economic crises and the rise of authoritarianism).

• Media Concentration USA – Business Insider (2012). Infographic: Six corporations control 90% of U.S. media.

•IMF (2018). Spreading the Wealth – François Bourguignon in Finance & Development (Arguments for redistribution, progressive taxation, and social investments).