Democracy and capitalism’s shadow

“THE top 10% own three-quarters of global wealth, while the bottom half holds only 2%.”

- BY FARID PANJWANI

(MIKE LUCKOVICH)

So states the World Inequality Report 2026. Can democracy survive when capitalism concentrates wealth so drastically?The belief that democracy and capitalism are natural allies is as widespread as it is inaccurate. To see this, one has only to observe capitalist accumulation under authoritarian political arrangements. The UAE is just one such example. Why then does this belief persist?

Democracy and capitalism often journey together — until they don’t. To a point, they do support each other. This is why it is not easy to find democracies without capitalism. Think of a society, poor and authoritarian, that then undergoes a revolutionary change that makes it both democratic and capitalist. For a while, the two would go together.

Democracy would bring freedom and political equality; capitalism would bring resources.

Even Marx acknowledged that capitalism creates 'colossal productive forces'. The growing middle class would demand greater freedoms and consumption, thereby strengthening both democracy and capitalism. For some time, prosperity and empowerment would rise together.

But this harmonious coexistence would soon wear off. Democracy is about political equality. Capitalism, by design, needs economic inequality. The two would eventually collide. In time, the wealth generated by capitalism starts to pool in fewer and fewer pockets. Growth continues, distribution falters. Tensions begin to appear.

In political spheres, they would vote against such a system, demand reforms, regulatory constraints and a redirection. In theory, democracy should prevent capitalism from reaching its logical outcome of concentrating wealth among a small elite. Yet that concentration of wealth is exactly what has been happening. Why? (The Dawn)