Pluralistic used a long essay on July 16 to turn the phrase “billionaire derangement syndrome” back on the billionaires and their defenders. The argument is blunt: market advocates say competition disciplines selfish actors, then some of the same institutions and writers make excuses for ultra-rich people who have escaped that discipline.
The essay starts from a familiar economic claim, shared in different ways by market liberals and some left critics of capitalism: people do not need to be saints if institutions make self-interest produce useful goods and services. Competitive pressure, in that account, pushes sellers to improve products and pushes employers to treat workers better because customers and workers can leave.
Pluralistic argues that the theory breaks down when the winners of markets buy or build insulation from competition. The post cites Federal Trade Commission chair Lina Khan’s line that firms considered too large to fail can also become too large to punish or care. It also points to a Justice Department filing that quoted an Apple executive questioning whether the company had already given consumers features that were more than “good enough” and suggesting tighter scrutiny of costly new features.
The mechanism, as Pluralistic describes it, is not mysterious. A challenger wants open entry, low switching costs and room to disrupt incumbents. An incumbent wants barriers: noncompete agreements, acquisitions that remove rivals, legal locks around devices and software, and political influence. The post calls that shift from profit-seeking under pressure to rent extraction behind walls.
The Thiel and Musk problem
The essay then connects that critique to Peter Thiel and Elon Musk. Pluralistic says defenders of billionaires have recently complained that political candidates are campaigning against the ultra-rich, citing a Marginal Revolution post by Tyler Cowen that discussed “billionaire derangement syndrome.”
Tim O’Reilly, writing in The Economist, is cited for the counterargument that Adam Smith’s capitalism depended on constraints, not on treating powerful owners as philosopher-kings. Political scientist Henry Farrell is cited for a related point: Musk and Thiel have been unusually open about politics that sit uneasily with democratic or competitive restraint.
Pluralistic points to a Musk social media post agreeing with the idea that only “makers” should vote and that universal suffrage produces universal suffering. For Thiel, the post cites his startup class notes, in which Thiel says capitalism and competition are opposites and argues that monopoly profits let companies rise above day-to-day survival pressure.
That distinction is the core of the post’s indictment. Pluralistic says Thiel does not reject constraints for everyone. He rejects them for a class of founders and financiers he treats as naturally fit to rule, while ordinary people remain subject to rules set by others.
Doctrine as cover
The essay also takes aim at several economic concepts it says are used to launder power: consumer-welfare antitrust, revealed preferences, a state-focused theory of regulatory capture and meritocracy. Pluralistic’s complaint is that these doctrines can turn existing wealth into evidence of deserved authority. If a monopolist still exists, the theory can label it efficient. If a rich person controls capital, the theory can treat the market’s outcome as proof of superior judgment.
Farrell, quoted by Pluralistic, says entrepreneurial risk-taking, unusual people and tight founder networks can all be valuable, while warning that the appetites of a small group of billionaires now appear hard to square with stable civil society.
Pluralistic’s conclusion is political, not subtle: the syndrome worth worrying about is not public hostility toward billionaires. It is the belief among some billionaires that wealth places them above elections, markets and ordinary rules.
This story draws on original reporting from Pluralistic.