The Quiet Coup: How Corporations Became the New Governments

Introduction: The Power We Didn't Elect

We didn't vote for Amazon, Pfizer, or BlackRock, yet their decisions dictate what medicine we take, the cost of our rent, and the soundness of our economy. They decide how we live, likely more than any of our elected representatives are supposedly doing in our best interest.

This is not the product of conspiracy or corruption, but of a quiet, structural shift: a gradual transfer of power from democratic institutions to private authorities. This was achieved not through coercion, but through calculation; by means of privatization, deregulation, and technological concentration. We have proceeded toward a world in which corporations perform many activities once the exclusive domain of governments, yet without democratic legitimacy or accountability.

We now live under a form of rule never subjected to a vote. No longer is the issue whether corporations are too powerful, but whether we still live in societies governed by public will or private avarice.

From Influence to Control: Corporate Capture of Policy

Lobbying and donations are shallow tactics. What we currently observe is the corporate takeover of legislation. Political economist George Stigler's theory of regulatory capture explains how regulators often fall into working in favor of the industries they are meant to regulate rather than serving the public interest.

The revolving door between the state and the corporation is a prominent source of conflicts of interest. Oil industry veterans in high-profile roles in the European Union's energy regulator is one such practice (Carroll, 2020). This fact erodes democratic accountability and shifts policymaking from public discourse to corporate planning. In India, pharmaceutical patent law reforms were directed strongly in the interests of the multinational pharmaceutical companies. These reforms extended monopoly protection and stifled the production of generic medicines—directly limiting the reach of affordable healthcare to millions (Sampat, 2012). Likewise, in Australia, lobbying from the fossil fuel industry slowed climate policy progress significantly, even with apparent scientific evidence of environmental deterioration (Green & Denniss, 2018).

The Disintegration of the Public-Private Divide

While often promoted as a means to greater efficiency, privatization has significant political consequences. Through the outsourcing of critical functions such as data storage, infrastructure, and emergency services to private entities, governments incrementally erode the abilities and influence of public institutions. Public infrastructure is constructed and maintained by private contractors, public information is processed and stored in corporate cloud services, and even emergency responses, defense logistics, and education systems are being transferred to companies that function outside democratic control.

In South Africa, the partially- privatized electricity supply sector is beset by accountability deficiencies that lead to mass outages that disproportionately inflict damage onto the poor (Eberhard et al., 2014). Meanwhile, Amazon Web Services' hosts government clouds in the US, UK, and Australia, outsourcing sovereign control over public data to private enterprise (Zuboff, 2019).

This establishes a hybrid government system where profit motives override human rights and justice. The philosopher Wendy Brown warns that in the market, neoliberalism translates citizenship into membership at the expense of the social contract and democratic governance (Brown, 2015).

Democracy for Sale: The Stateless Power of Corporations

Transnational corporations use fissured legal jurisdictions —systems where laws and regulations vary significantly across borders—to evade regulation and taxes. It is estimated that poorer countries lose more than 200 billion USD a year to tax avoidance and illegal financial flows—funds that could otherwise be employed to pay for critical public services (Cobham & Janský, 2018). This contributes to widening inequality and undermines states' ability to govern effectively.

Investor-State Dispute Settlement (ISDS) provisions within free trade agreements preserve a regime of corporate sovereignty. This is exemplified by the case of Philip Morris v. Australia, where the giant tobacco company sued the Australian government over its plain packaging law on the basis of a violation of intellectual property rights (TWN, 2015). Although Australia won in the end, the litigation delayed important public health policies and triggered severe economic costs.

These mechanisms undermine national sovereignty by shifting decision-making power into the hands of faceless arbitration panels with a bias toward corporate interests. Legal scholar William W. Burke-White calls this trend the creation of a "parallel legal order"—one that prioritizes capital over democratic rule (Burke-White, 2010).

From Citizens to Consumers: Commodification of Rights

As corporate governance increasingly displaces democratic interest, the very nature of rights itself is being reorganized. Whereas healthcare, education, and housing were previously seen as citizen rights, they are currently being reframed as commodities.

In this new framework, rights aren't secured—instead, they are bought, graded, and often denied on the basis of being able to pay. Market principles begin replacing democratic ideals and disassembling the very foundation of equality.

The privatization of the UK's NHS has introduced market incentives into healthcare provision, thereby undermining universality and exacerbating inequalities in healthcare (Pollock et al., 2011). In the case of Brazil, shrinking public university budgets in the face of increasing private education further enhance class and racial inequalities (Saad-Filho, 2017).

City housing markets in cities such as Mumbai and London are dominated by global investment funds that own houses as speculative assets, pushing low-income groups out (Fields, 2017). This is an expression of David Harvey's "accumulation by dispossession", where capitalist expansion privatizes the commons and dispossesses individuals (Harvey, 2003).

The result is a citizenship marked by consumption capacity, hiding structural disparities and dissolving democratic solidarity.

Resistance and Reclaiming the Public Sphere

Despite the scale of this shift, opposition is mounting. Antitrust movements are reemerging, notably in the EU, where regulators are resisting monopolies and maintaining market fairness. In the US, new regulatory measures are targeting tech and finance in the name of economic democracy.

In the meantime, bottom-up movements are reclaiming economic and civic power—through worker co-ops, local food networks, open-source technology, and data sovereignty campaigns. They are not merely oppositional; they are constructive experiments in creating the public from below.

Nevertheless, the most profound challenge is cultural. If we continue to view ourselves first as consumers, we risk adopting a world in which transactions, not rights, are the ultimate authority. We must move back to a citizen ethic: one that requires transparency, accountability, and involvement, regardless of whether power is held in the state or in corporations.

The EU antitrust case against Google's Android practices, for example, aims to keep monopolistic forces in check (European Commission, 2018). Activists in Kenya campaign for digital sovereignty and corporate responsibility in data management (Privacy International, 2020). Worker cooperatives such as Argentina's recuperated factories and Spain's Mondragon Corporation allow democratic economic alternatives that unlink governance from shareholder logic of profit (Laville, 2017).

However, without cultural transformation, these efforts will inevitably fall short. Citizenship must be reclaimed above consumer status, compelling institutions to add transparency, fairness, and engagement at national and transnational levels. Rescuing democracy in the 21st century means reshaping where power is located, and whose interests it ultimately serves.

Conclusion: Toward a New Global Social Contract

The silent coup didn't require soldiers or weapons; it won through deregulation, data centers, lobbying, and the logic of the market. We handed over power in the name of convenience and efficiency—without stopping to think who would wield it, and to what end.

Now, we operate in an economy where the laws are codified by those with money, not by those who agree. The nation-state remains, but its power to regulate is broken, watered down, and frequently subservient to global corporate interests.

If democracy is to have any real meaning in this new age, it must transcend beyond the ballot box; it must challenge the legitimacy of private authorities that shape our lives without reference back to the public, and it must make the government a public institution again, not a private transaction.

The choice is ours: a future where we are still citizens in theory, but consumers in reality—lives in societies we don't control anymore, governed by laws we never consented to, influenced by forces we can't see.

References

"Antitrust Case Against Google." European Commission, https://ec.europa.eu/commission/presscorner/detail/en/IP_18_4581.

Burke-White, William W. "Toward a Global Administrative Law of Investment." The Journal of International Law and Politics, vol. 37, no. 3, 2010, pp. 915–953.

Carroll, Toby. "Regulatory Capture in Global Governance: The Case of the EU’s Energy Sector." 2020.

Green, Ian, and Richard Denniss. "Big Coal’s Footprint in Australian Politics." The Australia Institute, 2018, https://australiainstitute.org.au/report/big-coals-footprint-in-australian-politics/.

Harvey, David. The New Imperialism. Oxford University Press, 2003.

Laville, Jean-Louis. "The Solidarity Economy: An Alternative Development Strategy?" United Nations Research Institute for Social Development (UNRISD), 2017.

Privacy International. "Kenya’s Data Protection Battle." Privacy International, 2020, https://privacyinternational.org/news-analysis/3492/kenyas-data-protection-battle.

Sampat, Bhaven N. "Intellectual Property Rights and Pharmaceuticals: Evidence from India." Health Affairs, vol. 31, no. 2, 2012, pp. 376–384. https://doi.org/10.1377/hlthaff.2011.0608.

Zuboff, Shoshana. The Age of Surveillance Capitalism: The Fight for a Human Future at the New Frontier of Power. PublicAffairs, 2019.