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This Is How We Get Oligarchs
Ron DeSantis’ political reprisal against Disney is an attempt to make businessmen the compliant tools of political rulers
Contemplating Elon Musk’s purchase of Twitter, Charlie Sykes recently asked whether America has an oligarch problem. He cites a definition of a Russian-style “oligarch” as “a very rich business leader with a great deal of political influence.”
But this misunderstands the role of the Russian oligarchs because while they have political connections, they have no political influence whatsoever. They are servants, not masters. Consider the case of the last semi-independent Russian billionaire, beer baron turned banking innovator Oleg Tinkov, whose holdings inside Russia evaporated overnight—sold off at fire-sale prices under the threat of nationalization—after he criticized Vladimir Putin’s war against Ukraine.
Russia’s problem is not that it has wealthy people with political opinions. Its problem is that its billionaires’ ability to keep their businesses and their fortunes depends on how well they conform to the political views of the real oligarchs: the siloviki, the ex-KGB guys who hold political power. That’s why we do have to worry—because those are the conditions that some on the American right are attempting to create here.
The Disney Shakedown
The new era of political reprisals against wayward corporations is heralded by Florida Gov. Ron DeSantis’ self-destructive war against Disney, one of his state’s top employers and economic mainstays. This has so far taken the form of a law dissolving the Reedy Creek Improvement District, a special local government entity created specifically for the Disney World Resort. The RCID allows Disney, in effect, to tax itself and use the money to provide basic public services such as water, sewage and firefighters for the park and its facilities.
Despite all the talk of this being a “special privilege,” the autonomy granted to Disney was a precondition without which it could not have built or expanded the resort, to the benefit of the state and surrounding local governments. Moreover, the creation of the district was necessary to avoid overwhelming county governments with the enormous expense and administrative challenges of running the massive resort’s services. Unwinding the arrangement could even saddle those local governments or the state government with $1 billion in the RCID’s debt.
So why blow it all up now? Because Disney opposed the governor on a piece of legislation, the so-called “Don’t Say Gay” law, which is designed as an engine of harassing lawsuits against gay teachers.
There is no other reason. Florida legislators did not suddenly discover a well-known arrangement with Disney that goes back to 1967. And if Disney’s supposed offense is that it backs the “grooming” of children by sexual predators—a slander the conservative media has been recklessly throwing around—would the appropriate response be merely to change their land-use regulations? Obviously, nobody decided Reedy Creek needed to be changed because it was a bad deal for Florida, and only a few QAnon crazies think it’s because Disney is run by a secret cabal of pedophiles. The only real reason is because the company opposed an item in the governor’s political agenda.
This is part of a wider, politically motivated assault on Disney that has involved threatening its trademark protection and vowing to target Disney with antitrust measures. The result is exactly what was intended: a chilling effect on other CEOs, warning them not to invoke the disfavor of the political right or its elected leaders.
But the most corrupt part of this move, as Tim Carney points out, is that it holds out the “quid pro quo” of retaining a favorable arrangement for Disney—so long as they agree not to do anything to oppose the governor. The dissolution of Reedy Creek doesn’t happen until June of next year, giving DeSantis the ability to hold that deadline over Disney’s head in return for what he regards as good behavior.
Or perhaps the governor’s solution will be more direct: He has talked about creating a new special district to replace Reedy Creek, which will be run by his direct appointees. It is a straightforward power grab: Do as I say, or soon your operations and basic services will be at the mercy of my lackeys. This is not a power that might potentially be abused. It is a power that is abusive by its very nature.
‘We Don’t Nationalize Businesses, We Nationalize People’
The only thing worse than this power grab by a governor is the ideology being spun by conservatives to justify it. In a spectacular act of intellectual acrobatics, National Review’s Rich Lowry posits: “Corporate executives who have bent to woke mobs out of fear should be grateful to Ron DeSantis…for giving them a reason to say to progressives trying to bully them into compliance with the latest left-wing cause, ‘No, sorry, you saw what those crazy bastards did in Florida.’” It is obvious that Lowry has not actually polled corporate executives to inquire about their gratitude. In what world is the solution to political bullying to employ your own regime of political bullying?
Elsewhere, Lowry offers the evasion that “Republicans don’t want corporations to become tools in advancing their agenda; they just want them to exit the culture wars.” But the requirement for businessmen to stay out of politics is exactly the deal Putin offered Russia’s oligarchs. We can now see very clearly what “staying out of politics” actually means: offering no resistance to whatever the ruling faction decrees and going along unquestioningly with its agenda up to and including the brutal invasion of a neighboring country. It does not mean political neutrality. It means political acquiescence.
This is the explicit goal of the economic theory of the nationalist conservatives, who advocate a “common good capitalism” in which corporations are required to operate “for the benefit of the workers and the greater society”—as judged by political leaders. In versions such as the one advocated by Missouri Sen. Josh Hawley, this involves ambitious schemes for having Commerce Department officials sign off on all trade transactions—a system that seems a lot more like cronyism than capitalism. (This, in turn, is just a conservative adaption of the left’s attempts at “stakeholder capitalism.”)
The point is not just to achieve an economic goal like more manufacturing jobs or higher wages. The point is also to manipulate the economy for culture war goals, such as bolstering the “traditional family” by encouraging more women to stay at home so we can all have a national re-enactment of “Leave It to Beaver.” DeSantis is showing us the next step: dictating what political messages corporations are allowed to broadcast and what political activities they are allowed to support.
It is the same principle used by the old fascists, who explained the difference between them and the communists: “I want everyone to keep the property he has acquired for himself…. But the state should retain supervision and each property owner should consider himself appointed by the state…. The Third Reich will always retain its right to control the owners of property.” Or as one Nazi leader put it more succinctly: “We don’t nationalize companies, we nationalize people.”
Since no faction in the American system has a political monopoly, we can expect that this will at first take the form of political leaders from different factions trying to intimidate corporations into supporting their different political messages. Carney reminds us that before DeSantis tried to coerce the political acquiescence of Disney, Democrats tried to do the same with churches.
Maryland Democrats in 2010 tried to impose a “rain tax” before Republican Larry Hogan won the governorship and killed the idea. A rain tax is a tax on paved surfaces that cause stormwater runoff. The worst part of the process came after the Democrats realized that suburban and rural churches have big parking lots and not a lot of disposable money.
The Democrats creepy solution: offer a partial rain-tax exemption for churches that gave environmentally correct sermons and take other "green" steps. So what we can expect is the push and pull of a war in which each side attempts to collect corporations and billionaires on their side, until one faction achieves political hegemony. No, we’re not anywhere near such a catastrophic outcome. But thanks to Gov. DeSantis, we’ve taken the first big step, which is to get what was once purportedly the party of small government and free markets to endorse the notion that corporations ought to be politically subservient to the state.
Going Off the Cliff
It’s important to grasp another big lesson from the Russian experience. Harnessing the oligarchs to the regime is not just about silencing the political opinions of the super-wealthy, because through control of the billionaires, an authoritarian faction can silence all debate. Putin long ago discovered that it was not necessary—not at first—to shut down the small intellectual journals or ban the writings of independent dissidents. It was necessary only to deny dissenters a mass audience by controlling the big newspapers, the magazines and especially the TV channels, making sure that all of them were owned by compliant oligarchs.
A diverse society with many voices is an achievement, and part of that achievement is allowing successful people and enterprises to bankroll dissenting viewpoints—even when they dissent from us.
If we interfere with that—well, we see the price Russia has paid for making its billionaires into lackeys and stamping out the very possibility of a well-funded, mass-audience political opposition. While the oligarchs timidly stay out of politics, this leaves no one with the ability to point out the regime’s disastrous crimes or miscalculations or to offer any political competition. We can see, in Putin’s war in Ukraine, the moral and material disasters that result when a society eliminates the corrective mechanisms that keep it from going over a cliff.
Do you want a society run by authoritarians and oligarchs? Because what’s happening in Florida right now is how we get there.