What Will Tech Moguls Do With Their Wealth?
Crude photoshop work done by Nathaniel St. Clair. Image Sources: Screenshot from The Big Lebowski. Photograph of Zuckerberg by Xavier Lejeune. Photograph of Bezos by Senior Master Sgt. Adrian Cadiz. Photograph of Musk from Office of Speaker Mike Johnson.
Few billionaires, including those in President Donald Trump’s Cabinet, wield as much influence as the tech moguls who shadowed him at his inauguration. Elon Musk, now one of the president’s closest allies, is overhauling the federal government at Trump’s request, which will no doubt secure future government funding for Musk’s companies. Trump’s recent dismissals of Federal Trade Commissioners critical of Amazon were meanwhile interpreted as friendly nods to Jeff Bezos, who pulled the Washington Post’s endorsement of Kamala Harris in the 2024 election.
America’s four richest people—Musk, Bezos, Mark Zuckerberg, and Larry Ellison—all in tech, have aligned themselves with Trump to varying degrees. While politically motivated, they must also navigate the entrenched power of America’s old money, as historically, new wealth has often clashed with established elites. Today’s tech billionaires certainly hold immense power, but their positions may still be more precarious than those of enduring dynasties from different eras and industries.
For generations, the country’s wealthiest families have maintained their dominance by embedding their businesses within the nation’s economic foundations while keeping wealth in the family. Tech billionaires are following suit, but rather than simply passing wealth down to their heirs, they are exploring new financial and legal structures to secure their fortunes. Like the philanthropic efforts of the Gilded Age, these initiatives may appear benevolent but are ultimately designed to consolidate power, both during Trump’s second term and long after.
The Evolution of America’s Ultra-Rich
Though the nation’s founders rejected aristocracy, a landowning elite quickly emerged from former British colonialists. But as immigrants arrived—free from the constraints of a privileged nobility in Europe—new entrepreneurs quickly monopolized key industries. They and their heirs preserved their corporate empires by proving their value to Washington, securing grants, tax breaks, subsidies, and other forms of corporate welfare.
Eleuthère Irénée du Pont, for instance, built the first major gunpowder factory in the U.S. in 1802, and received contracts for explosives during the War of 1812 and the Civil War. Andrew Carnegie’s steel empire supplied railroads and infrastructure for government-backed industrialization efforts during the Reconstruction era, with John D. Rockefeller’s Standard Oilpowering homes and factories. J.P. Morgan dictated financial policy, acting as the government’s emergency lender in 1895 and 1907, and Henry Ford’s company provided vehicles and factories in World War I and II.
By the 20th century, the fortunes of America’s elite began to wane due to inheritance taxes, extravagant heirs, federal trust-busting, and a changing business climate. Some, like the Roosevelts, turned to politics. Others funneled wealth into philanthropy like the Carnegie Endowment for International Peace and Rockefeller Council on Foreign Relations, which continue to shape foreign policy.
Yet, certain families have endured to this day by maintaining tight family control over their companies while avoiding public scrutiny. The Ford family still holds sway over the Ford Motor Company, though their wealth pales next to modern dynastic titans. Meanwhile, the Cargill family has quietly remained America’s fourth-richest, more than 150 years after Cargill, Inc., was founded.
And as other old dynasties faded, new ones took their place. Within 30 years of Sam Walton opening the first Walmart in 1962, the Waltons became America’s richest family, a title they still hold with more than $400 billion. Becoming indispensable to the government allows them to extract benefits: as the nation’s largest private employer and with its vast customer base, Walmart has secured billions in state and local subsidies to fuel its expansion. Additionally, a significant portion of its low-wage workforce relies on food stamps, shifting labor costs onto public assistance programs, while Walmart stores capture more than 25 percent of annual food stamp spending ($115 billion).
America’s other richest families have similarly entrenched themselves in key industries, supply chains, and economic systems. The Mars family, America’s second richest, profits from military food supply contracts through Mars, Inc. The Kochs, despite their libertarian rhetoric, benefit from lucrative contracts to supply the U.S. military with natural resources and have received hundreds of millions in energy subsidies. The Cargill family benefits from billions in indirect subsidies that reduce feed costs for their agribusiness empire.
America’s elite also work to keep wealth within the family. As part of the “wealth defense industry,” they have spent decades lobbying to weaken or repeal inheritance tax laws while shielding assets through trusts, tax loopholes, and private foundations. Privately held companies called family offices manage multigenerational fortunes, quietly overseeing wealth transfers and handling disputes.
Tech’s Troubles
The new generation of ultrawealthy tech oligarchs wield enormous power, but face obstacles in securing their legacies. Public sentiment has turned against dynasty-building, with initiatives like the “Giving Pledge” discouraging wealth preservation by billionaires. Musk’s recent pivot from Democratic circles to Republican allies highlights an ongoing search for a protective political base, while Zuckerberg has also faced fire from both sides of the political spectrum.
Unlike dynastic families, much of their capital is tied to volatile technology sectors, largely in stocks, private equity, and venture capital rather than stable landholdings and legacy industries. Market fluctuations have erased hundreds of billions of their net worth since Election Day, exposing this vulnerability.
Tech’s expansion has also triggered clashes with entrenched wealthy families. Musk and the Kochs have feuded over subsidies for natural resources versus electric vehicles. Walmart, once aligned with Tesla in pushing renewable energy, later sued Tesla in 2016 over multiple solar panel fires linked to SolarCity, a struggling firm founded by Musk’s cousins that Tesla controversially bailed out. Walmart’s push into electric car charging infrastructure will only intensify tensions in one of Musk’s critical industries.
Bezos’s desire to dethrone Walmart as the country’s top retailer has seen tensions going back decades. In 1998, Walmart sued Amazon, alleging it poached 15 Walmart executives to gain insight into its computerized retailing systems. Despite Amazon’s rise, Walmart has held its ground, and its growing push into e-commerce is adding additional pressure.
Trump benefits from his alignment with tech billionaires in his second term, while they recognize the role of his political influence in protecting their interests and undermining rivals. Trump criticized the Koch family during his first term, reinforcing his views on the 2024 campaign trail. Walmart heir Christy Walton funded anti-Trump opposition in the 2020 election, and recently funded a political ad widely interpreted as critical of him. Proposed food stamp spending cuts could hurt Walmart, as Musk and Bezos seek ways to challenge the Walton family’s business interests.
Trump’s pro-big business background may also allow tech billionaires to push their visions more effectively than under other presidents. However, his past disputes with Silicon Valley, including trials against Google and Meta, signal a willingness to use regulatory power against tech giants in high-growth industries. His personal feuds with Bezos, Zuckerberg, and Musk make him an unlikely ally, and tensions within the tech billionaire class, such as the Musk-Zuckerberg rivalry, further highlight their lack of cohesion.
Embedding and Consolidation
Still, through lobbying and expertise, America’s wealthiest individuals have deeply embedded their companies into U.S. industrial and economic systems. Musk’s Starlink satellites have played a crucial role in U.S. assistance to Ukrainian war efforts. His SpaceX, alongside Bezos’s Blue Origin, has secured substantial NASA contracts. Zuckerberg’s Meta is providing AI technology for the U.S. military, and Larry Ellison’s Oracle has multiple government contractsas well, particularly in data, cloud computing, and online security.
However, true long-term dominance in America’s consumer-driven economy requires sustained access to consumers. Musk has excelled in this, with Starlink recently partnering with Verizon and T-Mobile to expand availability. His business empire has been heavily supported by government grants, and his Tesla leads electric vehicle (EV) charging networks and has received both federal and state subsidies, now subject to political battles—California threatened to revoke Tesla state tax credits in January 2025 in protest of Trump’s call to eliminate federal incentives for EV purchases.
Musk, Bezos, Zuckerberg, and Ellison also maintain an advantage over the other richest men in the U.S. With more direct control over their dominant companies, they can shape the future of their wealth in ways that others with more passive wealth cannot. Zuckerberg, at 40 years old, faces less immediate pressure than Larry Ellison at 80, but all are actively exploring ways to secure their influence beyond one generation, much of it in the name of philanthropy. Rather than passing down wealth to heirs, their fortunes are flowing into trusted investment vehicles managed by family members and loyalists.
As with family dynasties, family offices have become a preferred wealth management tool for tech billionaires. However, unlike traditional family offices, those of tech moguls are not necessarily run by family members and tend to focus on high-growth, disruptive industries, often investing in sectors where their companies already operate or could expand.
For example, entities like the Bezos Family Foundation serve as generic philanthropic organizations. However, in 2005, Bezos established Bezos Expeditions as a single-family office LLC, to manage his wealth and invest in industries from space exploration to health care. Similarly, the Chan Zuckerberg Initiative is an LLC conducting “for-profit philanthropy.” In 2021, it shut down a Canadian company it acquired, Meta, to adopt the name, showing its wider integration with Zuckerberg’s corporate operations.
Musk’s family office, Excession, was set up in 2016 and played a key role in funding his $44 billion acquisition of Twitter in 2022. It is run by former Morgan Stanley Banker Jared Birchall, who has hired investigators to scrutinize Musk critics. Ellison’s Lawrence J. Ellison Revocable Trust is highly secretive and can be leveraged for personal interests. In 2019, it was suggested the trust would back his daughter’s Annapurna Pictures, which had taken on significant debt. Even without a formal commitment, the trust’s influence made banks uneasy about initiating legal proceedings, ultimately resulting in a settlement.
Without building traditional dynasties, tech billionaires may ensure that the next era of wealth accumulation belongs to corporate and philanthropic hybrid structures designed for long-term influence over policy, industry, and technology. However, these models are untested against the established wealthy families, which have endured over generations.
Today’s wealthy figureheads nonetheless feel emboldened to establish entities to manage their wealth or risk losing it through taxes, individuals, or companies beyond their control. Unlike the Gilded Age billionaires, many of whom saw their money flow into philanthropy or squandered on heirs, these billionaires are channeling their wealth into carefully crafted investment vehicles with missions they have explicitly designed. Aligning with Trump may help secure these entities, carve out business niches, and strengthen political links for future opportunities and contracts. Yet, the unpredictability of his persona and approach could easily disrupt their long-term plans.
This article was produced by Economy for All, a project of the Independent Media Institute.
How Many Stockbrokers Does it Take to Change a Light Bulb?
Image by Eric Brehm.
The Musk and Trump cuts to government programs are part of a larger movement towards ‘free markets’ began a little over fifty years ago when we abandoned fixed exchange rates (rates set by the government) in favor of floating exchange rates (the Float). In other words, the government past the decision making for determining the rate of exchange between two currencies to the market (those buying and selling currencies).
The Float was a watershed moment. It began a shift away from government in favor of business and letting the market sort it out. This coup was a victory for the Johnny Appleseed of free markets, Milton Friedman. The Friedman Doctrine held that business had no social responsibly except to maximize profits.[1] He felt government programs initiated by FDR to help the average American, such as the minimum wage and Social Security were wrong.[2]
Labor who had benefitted from New Deal programs like the Wagner Act saw their power begin to wane; while business gained. Conservative and pro-business groups like the United States Chamber of Commerce began advocating for market-based solutions, arguing government regulations and taxation were business impediments.[3]
When Reagan was elected he became the voice for the market movement saying, “government is the problem.”[4] He cut taxes and plunged America deeper into the red.[5]
Sometime in the 1980’s monetary policy triumphed over fiscal policy. Fiscal policy (spending, tax rates,…) is the domain of elected officials. Monetary policy is conducted by the Federal Reserve (Fed) run by an unelected bureaucrat whose governing board consists of big banks. The market was now in control, money had toppled democracy.
The Fed became the bagman for the market movement. While the Fed focuses on price stability and the economy it made protecting financial markets tantamount. So when stocks crashed in 1987 the Fed came to the rescue and bailed out the stock market; a policy it continues. Stock valuations surged—measures such as the PE ratio of stocks has on average been higher since 1987.[6] The rich, through no action of their own, got richer.
To understand this take the Price Earnings Ratio (PE) of a stock. If a stock is earning a $1 per share and has a PE of 10 its price would be $10 (10 X $1). If the PE goes to 15 its price would increase to $15 (15 X $1) Basically the Fed had the effect of levitating stock prices. Meanwhile, the Fed ignored the surge in Fringe Banking—Payday Loans, Rent-to-own…–and the poor suffered.
Rising financial asset valuations were a boon for the rich to fund think tanks, ballot initiatives, payoff politicians and more.
It can be difficult to accept that the Fed has become the power source for our country, but one need only look to how money has corrupted and taken control of politics and just about everything else. This is why I protested by the Fed in the early 2000’s.
Looking at unions as a surrogate for labor, union density in the 1950’s and 1960’s hovered around 30%.[7] In the forty years between 1983 and 2022 union membership halved from 20.1% to 10.1% of workers.[8]
When unions had their peak influence on the economy several felt they were abusing their power, pointing to actions such as featherbedding. In 1963 featherbedding cost railroad carriers $592 million compared to industry earnings of $681 million.[9] At the time light bulb jokes were popular and unions would be ridiculed for their mischief. For example, ‘how may union members does it take to change a light bulb?
Three, one to carry the ladder, one to carry the light bulb and one screw it in. Or four, add a ladder holder. Or…
With the market having ascended to power,[10] has it, like labor fifty years ago, abused its power? To answer that we turn the Financial Services Industry, or what is classified as Finance and Insurance (FI). So, how many stockbrokers does it take to change a lightbulb?
FI serves a unique role. It channels money from savers to borrowers to facilitate the economy; savers are paid for providing capital for businesses to grow. It also acts as conduit for the Fed to conduct its open market operations, a key component of monetary policy. Meaning the Fed buys and sells government bonds through FI; in a way giving FI first dibs on the money it puts in the economy—
or takes out. Technically the Fed acts through banks, but the separation of banking from other financial services ended long ago and was formalized with the passage of the Financial Services Modernization Act of 1999 that allowed for the merging of banking, brokerage and insurance.
While FI is not directly responsible for the economy it is intimately tied to it because of its responsibilities; to facilitate the Fed’s policies and act as a financial intermediary. Arguably, its end product is the economy, or GDP (Gross Domestic Product, the dollar value of the overall economy). So, how much are we paying FI to generate economic growth?
By looking at the GDP contribution of FI relative to GDP, FI/GDP, over time we can get an approximation of FI’s efficiency. In 1972 the year before the Float began FI accounted for 4.2% of GDP[11], by 2023 it accounted for 7.2 % of GDP.[12] Meaning it took an additional 3% (7.2 % – 4.2%) of GDP in 2023 to get the same relative economic output (GDP) we had in 1972. There was a financial featherbedding of sorts.
The value of 3% of GDP in 2023 was $831B (.03% X ($27,720.7T). Let’s not forget this has been going on for over fifty years since the Float began in 1973, to the tune of trillions of dollars.
What makes this take even more egregious is that productivity for the economy overall improved 43% since 1972.[13] Had FI performed commensurately its GDP contribution would have fallen to 2.9% (4.2%/1.143%) for a savings of $360B ((4.2%-2.9 %)X ($27,720.7T) in 2023. Combining the lost productivity gains with the 3% increase in FI since 1972, arguably 4.3% of our economy was redundant in 2023.
The surge in transactions was because of financialization—the process of converting business, government and even personal assets into financial instruments. Through securitization existing securities were churned into new securities, loans were bundled and turned into tradeable securities…Privatization saw government assets turned into tradeable financial assets. New financial markets such as currency trading and derivatives opened up. Derivative securities (leveraged securities whose value is based on another security), almost nonexistent prior to the Float, had an estimated notional value (the face value of the underlying instrument it is derived from) globally of $715 Trillion (6/23 BIS).[14] This is for OTC derivatives and does not include exchange traded ones.
Look at it this way, the Spanish needed large galleons to haul all their ill-gotten booty from the Americas back home—today we have privatization, securitization…and electronic transfer.
There is more. The Fed’s easy money and deregulation has made financial engineering a profitable business strategy. Private Equity (Leveraged Buyouts) accounted for 6.% of GDP in 2022[15]. PE restructures and does not make anything new; and does so painfully as Oliver Stone showed us in Wall Street. Gretchen Morgenson and Joshua Rosner in their book, They Are the Plunderers, exposed the behavior of PE, calling it a money spinning machine…that created little value for society and thinned our country’s social fabric.[16]
Share buybacks by corporations used to be illegal because it was considered price manipulation. Thanks to the magic of deregulation it became legal in 1982. By 2021 share buybacks were valued at about 2.9% of GDP.[17]
Quantifying the extent of corporate financial engineering is next to impossible. We can however gauge the portfolio income(investments) of corporations. In 2021 it was about 1.1% of GDP. [18] Undoubtedly, this understates the extent of corporate financial engineering. We need only to look to General Electric (GE Finance), General Motors (Ally Finance) and Sears (Discover) to see how significant financial engineering can be to a company’s profitability.
Adding it all together 14.8% (4.3% + 6.5% +2.9% + 1.1%) ($4.1T in 2023) of our economy consists of some form of financial engineering, much of it a paper mirage.
The market, the flagship of capitalism, is predicated on a lie—it is not the best arbiter for decision-making, nor is it efficient. So when you hear the bellyaching and demonizing of welfare queens, the evils of regulation, how bloated and inefficient the government is, or the bogeyman of socialism…don’t take the bait, the speaker is trying to divert your attention from something; usually the looting of government—a tax cut, corporate perks…
Musk and Trump’s crying about government inefficiency means something else is afoot.
Realize the market has a face that reaches into many of our country’s cities and towns. It includes: financial advisors, stockbrokers, hedge funds, bankers, private bankers, money managers, traders, CTAs, CFA`s, private equity firms, investment bankers, institutional salespeople, investment consultants and more. They need to be told the market is a fraud and to stop ripping us off.
So, how many stockbrokers does it take to change a lightbulb?
It has to be in the hundreds, if not thousands, or more. We are talking trillions of dollars in 2023. All those markets, each with their own fiefdom. All those grubby hands, each taking a cut of the action creating one humongous inefficient and self-serving bureaucracy, we call ‘the market.’
Consider. One to screw the light bulb in, another to underwrite a stock on the endeavor, a team to do the due diligence necessary to issue the stock, someone to trade the stock, a retail stockbroker and an institutional salesperson to promote the stock, a fund manager to buy the stock, someone to separate the stock dividend from the stock and sell them as separate securities, …Then there is compliance, legal, the back office…
Cannot forgot all those other financial products—bonds, futures, options, currencies, swaps, ETF’s, commodities…
Madis Senner is a former global bond manager. His latest book is Everything Has Karma. https://motherearthprayers.blogspot.com
1. ‘A Friedman doctrine‐- The Social Responsibility of Business Is to Increase Its Profits,’ Milton Friedman, NY Sept. 13, 1970 ↑
2. Capitalism and Freedom, Milton Friedman, Fortieth Anniversary Edition, Page 35. ↑
3. Heather Cox Richardson, Democracy Awakening, Pages 45-46. ↑
4. 1981 Inaugural address. https://www.reaganlibrary.gov/archives/speech/inaugural-address-1981 ↑
5. https://www.ushistory.org/us/59b.asp?srsltid=AfmBOorcvHhm4gjYX4Jp88aB7HCzx-U59hRer5iAsVW7gU3eo8bmK06d ↑
6. A historical chart of PE’s going back to 1950 shows a surge beginning around 1987. The PE rarely exceeded 20 before 1987 and has consistently traded above 20 since. https://www.stockmarketperatio.com/#google_vignette ↑
7. US Treasury, ‘Labor Unions and the U.S. Economy,’ Exhibit 1. https://home.treasury.gov/news/featured-stories/labor-unions-and-the-us-economy ↑
8. Here’s why the US labor movement is so popular but union membership is dwindling,’USA Today, sept 7, 2023, https://www.usatoday.com/story/money/nation-now/2023/09/04/us-union-membership-shrinking/70740125007/ ↑
9. Featherbedding on the Railroads: by law and by Agreement.” J. A Lipowski, Transportation Law Journal, – 8 Transp. L.J. 163 1976 https://www.law.du.edu/documents/transportation-law-journal/past-issues/v08/featherbedding.pdf ↑
10. https://www.theatlantic.com/magazine/archive/1999/03/the-market-as-god/306397/ ↑
11. FI’ GDP contribution/Total GDP, $51.5B/$1238.3B=4.158%. Per Table 1. Value Added by Industry Group for Selected Yea, Gross Domestic Product by Industry for 1947–86 https://apps.bea.gov/scb/pdf/2005/12December/1205_GDP-NAICS.pdf ↑
12. $1,988.2B/$27,720.7= 7.172%. ‘Table 14. Gross Domestic Product by Industry Group: Level and Change from Preceding Period, Gross Domestic Product (Third Estimate), Corporate Profits (Revised Estimate), and GDP by Industry, Third Quarter 2024, BEA. https://www.bea.gov/sites/default/files/2024-12/gdp3q24-3rd.pdf ↑
13. Total Factor Productivity for the economy was 72.796 in 1972 and 104.107 in 2023. 72.796/104.107=1.4301. ↑
14. https://www.bis.org/publ/otc_hy2311.htm ↑
15. Statixta. https://www.statista.com/statistics/469719/private-equity-sector-economic-impact-usa/#statisticContainer ↑
16. Page 17. ↑
17. Share buybacks were valued at $795.5B in 2023 795.5B/$27,720B =2.87%.
18. Buybacks stats–https://www.prnewswire.com/news-releases/sp-500-q4-2023-buybacks-increase-18-0-compared-to-q3–full-year-2023-shows-decline-of-13-8-from-2022-levels-earnings-per-share-impact-continues-to-decline-buybacks-tax-reduced-q4-operating-earnings-by-0-44-and-2023-by-0-40-302091498.html ↑
19. Portfolio Income in 2021 was $248,8 While GDP was $22,997.5B. 248.8/
22,997.5 = 1.08 or 1.1%
Portfolio Income from Table 8: Returns of Active Corporations, Form 1120S, Form 8825, Rental Real Estate Income and Expenses of an S Corporation.’ https://www.irs.gov/statistics/soi-tax-stats-corporation-income-tax-returns-complete-report-publication-16 ↑
