OP-ED: When the Working Class Can't Afford the Market, That's Not Capitalism — It's an Oligarchy

A market only works if the people doing the buying can actually afford what's for sale. When that breaks down long enough, what's left isn't capitalism anymore — it's concentrated economic power wearing capitalism's name.

What a Market Is Supposed to Do

The basic promise of a market economy is an exchange: businesses compete for customers who have real purchasing power, and that competition is supposed to improve prices, quality, and wages over time. It depends on both sides of that exchange staying real. A seller needs customers who can pay. A worker needs wages that keep pace with what the seller is charging. When one side of that loop breaks, the market stops doing the thing it's supposed to do.

What Happens When Wages and Prices Come Apart

Over the past several decades, wage growth for most workers has not kept pace with the cost of housing, healthcare, and other basic goods, even as productivity and corporate profits have climbed. When the people doing the buying have less real purchasing power every year, businesses that depend on broad consumer demand either raise prices to match a shrinking customer base, consolidate until only a few large players can survive on thinner margins, or both. Neither outcome looks like a thriving competitive market. Both look like a market narrowing toward whoever already holds the capital.

Why We'd Call That an Oligarchy, Not Capitalism

Capitalism, in its textbook form, depends on broad participation — many buyers, many sellers, real competition. An economy where a shrinking number of firms can set prices because the customer base has no real alternative, and where political and economic power increasingly sit with the same small set of actors, is something closer to an oligarchy operating under capitalism's branding. The problem isn't that markets exist. It's that market power has concentrated to the point where the basic mechanism — competition responding to what customers can actually afford — has stopped functioning for a large share of the economy.

What This Means for Neighborhood Businesses

This is exactly the space neighborhood businesses operate in, whether they frame it this way or not. A locally owned shop or service that prices for its actual community, rather than optimizing for a distant shareholder's quarterly return, is one of the few remaining forces pulling an economy back toward broad participation instead of concentration. That's not a small thing. It's why we think advising neighborhood businesses honestly, including the numbers that are hard to hear, is advocacy work and not just consulting work.

Frequently Asked Questions

Isn't this just a political opinion?

It's our opinion, stated plainly, as an op-ed. We think the economic data behind it — wage growth versus cost of living, corporate concentration — is not seriously disputed, even if the conclusions people draw from it differ.

What's the alternative view?

Others argue that market concentration reflects genuine efficiency gains and that wage and price trends are more complicated than a single narrative captures. We think that argument deserves to be heard, even where we land differently on the conclusion.

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The Local Mogul is King's Dream Business Consulting's blog, covering the people and small businesses building our local economies.