A quarter century ago, Vladimir Putin gathered 21 of Russia’s top oligarchs in the Kremlin to let them know that he, not they, held power in Russia. The young Russian president (not yet for life) informed them that they could keep the wealth they’d amassed if they complied with his political goals. Partnership with Putin held out the prospect of safety, and even greater riches. “We received confirmation,” an attendee named Mikhail B. Khodorkovsky said, “that the development of Russian business is one of the state’s top priorities.”

Most of the oligarchs submitted, but those who didn’t went to prison or into exile, lest they fall prey to the country’s epidemic of window-plunging deaths. (Khodorkovsky was imprisoned, putatively for fraud and tax evasion, but really for supporting independent media and opposition parties.) Since then, affinity for Putin has been a sine qua non of high-level economic success in Russia.

An eerily reminiscent scene played out late last year at Mar-a-Lago, Donald Trump’s Winter Palace, where Stephen Miller, one of Trump’s loyalty enforcers, met with Meta’s CEO, Mark Zuckerberg. The weather was more pleasant, and presumably neither party contemplated defenestration as a settlement alternative, but many other details seemed to echo. “Mr. Miller told Mr. Zuckerberg that he had an opportunity to help reform America, but it would be on President-elect Donald J. Trump’s terms,” The New York Times reported. Because Trump had recently warned, “We are watching [Zuckerberg] closely, and if he does anything illegal” during Trump’s second term, “he will spend the rest of his life in prison,” this opportunity must have sounded enticing. Zuckerberg indicated that he would not in any way obstruct Trump’s agenda, according to the Times, and foisted blame for any prior offenses onto subordinates.

By the time Trump assumed power, Zuckerberg was lavishing him with praise. “We now have a U.S. administration that is proud of our leading companies,” he gushed of the man who had once threatened him with prison, “that prioritizes American technology winning. And that will defend our values and interests abroad.” His rehabilitation complete, Zuckerberg assumed a place of pride at Trump’s inauguration, alongside Jeff Bezos, Elon Musk, and other titans of industry. His eyes were now on the future, and the promised Trumpian Golden Age.

The president’s public communion with the business titans who have submitted to him has been analyzed as a signal of his authoritarianism and his alliance with the rich. But it also reveals another emerging aspect of Trumpism: his rejection of the capitalist principles that ultimately generate prosperity.

Trump has never believed in the invisible hand—in leaving people alone to pursue self-interest in a free market; in letting market forces allocate capital and arbitrate any given company’s success or failure. Nor does he even believe in traditional mercantilist protection. He believes, like Putin, in political control of the economy’s commanding heights—success for those executives and companies who please him, failure for those who don’t. And he seems to be seeking that control more actively than he did in 2016.

Already, Trump’s words and actions have brought about a psychological transformation within the executive class. Presidents and business leaders have sometimes tangled, or formed partnerships, but the combination of fear and solicitousness that Trump now commands is wholly new.

After the election, The Wall Street Journal reported, businesses began looking at steps such as “buying the Trump family’s cryptocurrency token” and scrubbing their websites of Democratic-friendly language. Stanley Black & Decker took down an old post-insurrection statement saying it would “use our voice to advocate for our democracy and a peaceful transition of power,” and donated $1 million to Trump’s inauguration fund. A steel executive hoping to win Trump’s approval to purchase U.S. Steel held a press conference in Butler, Pennsylvania—a holy site in the MAGA universe since the assassination attempt at a rally there in July—where he declared, “America First!”

Bezos has not renewed his financial support for the Science Based Targets initiative, which works with businesses looking to cut emissions. After Trump gave Musk, the largest donor to his campaign, a limitless portfolio to reshape federal policy, businesses began to see Musk’s commercial empire as a route to political favor too, as the Financial Times noted in February. Visa struck a payment-processing deal with Musk’s controversial social-media site, X, while Amazon boosted its planned marketing there. Musk’s former rivals hastily reconsidered their rivalries: JPMorganChase dropped a lawsuit against Tesla (the company said the timing was coincidental), and Jamie Dimon announced on CNBC that he had “hugged it out” with Musk after a long feud.

The Journal, as America’s most prominent business paper, has documented this cultural transformation in remarkably clear terms. Sentences like this began appearing regularly after the election: “Executives across the corporate sphere are working to get in the good graces of the new administration” (November). “Titans of the business world are rushing to make inroads with the president-elect, gambling that personal relationships with the next occupant of the Oval Office will help their bottom lines and spare them from Trump’s wrath” (December). “Companies seeking Trump’s favor have plenty to gain” (January). The newspaper that American capitalists consult to find out how to run their businesses is informing them that they must gain Trump’s favor if they want to get ahead.

It would be naive to depict this behavior as totally novel. For decades, big companies have spent great sums on lobbying, and their executives have long made pilgrimages to Washington to advance their interests. And they’ve often gotten results.

But Trump appears to be ushering in a change not only in the degree of government favoritism, but also in kind. And the velocity of the transformation, coming as it does alongside a cascade of tumbling norms, can obscure how differently he is operating.

The change can be seen most blatantly in the media industry, which has drawn Trump’s gaze more than any other. Bezos, the owner of The Washington Post, and Patrick Soon-Shiong, who owns the Los Angeles Times, spiked endorsements of Kamala Harris, claiming they would give off the appearance of bias, but then after the election made personal statements praising Trump or his Cabinet picks, as if that somehow wouldn’t. Since then, several major companies have settled lawsuits that Trump had brought against them, and that likely would have been defeated if not laughed out of court. ABC, owned by Disney, donated $15 million to Trump’s presidential library to settle his complaint that George Stephanopoulos had described Trump as having been found liable for rape (he was found liable for sexual abuse). After incoming Federal Communications Commission Chair Brendan Carr warned Paramount executives that their merger bid could be at risk because of Trump’s anger at CBS, which Paramount owns, the network reportedly began talks to settle a frivolous $10 billion lawsuit complaining that 60 Minutes had edited out unflattering portions of its interview with Harris. Even after the presiding judge expressed extreme skepticism at the merits of Trump’s lawsuit against Meta for suspending him from Facebook after the January 6 insurrection—a right it clearly possessed as a private entity—Zuckerberg offered up $25 million in penance.

[Read: Trump says the corrupt part out loud]

Putting the screws to media owners in particular, especially early on, seems to follow the same playbook that Putin and other strongmen have used to consolidate their power. So does finding opportunities for personal enrichment along the way. (Putin, a lifelong public servant, has become one of the world’s wealthiest men.) Filing weak or groundless lawsuits and expecting his targets to settle for fear of government retribution appears to be a perfectly legal way for Trump to collect baksheesh.

Although Trump has so far devoted the most attention to media businesses, he has not ignored the broader economy. Every economic-policy decision he makes is a potential weapon to punish dissent or reward his friends, beginning with tariffs.

[David Frum: The price America will pay for Trump’s tariffs]

Trump has never described himself as a free-market purist, and his enthusiasm for levying imports is his best-known deviation from his party’s traditional economic philosophy. This impulse is often described as a protectionist instinct, aimed at helping shield key industries or American businesses generally. But in fact, Trump’s tariff strategy, if you want to call it that, hardly advances any coherent economic goal. He has threatened tariffs on countries for non-economic reasons, and levied tariffs on industrial inputs, such as aluminum and copper, that make American industries less, not more, competitive by raising their costs. Trump apparently believes that tariffs are borne by foreigners, and are therefore an untapped source of free money from overseas. He enjoys the idea of using them as levers to extract diplomatic concessions as well.

But Trump has also used tariffs to gain personal and political leverage over American businesses. During his first term, Trump levied broad tariffs and then entertained a parade of executives pleading for exemptions, which his administration doled out at its whim. The Office of the United States Trade Representative fielded more than 50,000 requests from domestic businesses for exceptions to the tariffs on Chinese goods alone, while the Commerce Department sifted through almost half a million waiver requests. Trump’s decisions were often arbitrary—Bibles got a tariff exception, on the apparent basis that their costs needed to stay low, but textbooks did not.

One study of the exceptions, published by the Journal of Financial and Quantitative Analysis, found that firms that had donated to Trump or hired staff from his administration were more likely to receive tariff exceptions. The tariffs, and the ability to hand out exceptions without any oversight or method, were “a very effective spoils system allowing the administration of the day to reward its political friends and punish its enemies,” the authors concluded.

A 2019 investigation by the Commerce Department’s inspector general reported “the appearance of improper influence in decision-making” in the waiver process. In his second term, Trump has managed to solve this problem—if you define problem as the exposure of corruption rather than its existence—by firing, to date, the inspectors general at 18 federal agencies, including Commerce.

Trump’s greatest advantage in this regard is that he has never professed adherence to any standard of fairness. When he discusses his plans to regulate businesses, or reward them with tax breaks, he does so in nakedly transactional terms. The business community understands that every decision the federal government makes, whether it involves antitrust enforcement or taxation or criminal justice, will be meted out on the basis of Trump’s political and personal whims. Trump does not even pretend otherwise, because the pretense would undermine his power.

Presidents may not be angels. But they used to follow a general presumption of leaving the task of picking winners and losers to the private sector. They likewise observed a wall between public and private interest that we can barely recognize today.

Seventy-two years ago, President Dwight Eisenhower selected Charlie Wilson, the head of General Motors, as his defense secretary. Skeptical members of Congress quizzed Wilson as to how he would put aside residual loyalty to his former company. Wilson confessed, “For years I thought what was good for the country was good for General Motors, and vice versa.” The confession scandalized the country. Although Wilson was trying to say that General Motors benefited from national prosperity, the very possibility that he might conflate the interests of his former employer with those of the country was beyond the pale.

[From the April 2018 issue: Is Big Business really that bad?]

At the moment, large swaths of government policy are being dictated by the current CEO of a car company. And yet it is unfathomable that the Trump administration would deem Elon Musk’s dual role unethical, let alone demand that he step down from Tesla and his other companies as a condition of public service. Musk, like Trump, respects no distinction between his personal financial interests, those of his political party, and those of the country. The seamless connection between political power and personal wealth tells everybody who belongs to the upper class or aspires to it that their safest path is to join the ruling claque.

This is alarming for any number of reasons. But, not least among them, it violates the key precept of any free-enterprise system: that market competition dictates which businesses succeed or fail. Through innovation and creative destruction, this kind of competition yields national prosperity.

The nature of Trump’s economic vision—populist? nationalist? traditional conservative?—has been the subject of endless debate. The reality is that he brings together the least attractive elements of capitalism and socialism, fusing heavy-handed state control with high inequality, and entrenching a set of oligarchs who serve simultaneously as the ruling party’s victims and co-conspirators. The more that political favor displaces market competition as the basis of corporate success, the worse things will get.

It may seem to Americans influenced by Trump’s well-crafted persona as a business genius or lulled by the record of his first term (when he inherited a growing economy) that he will bring some pro-business magic to his second term. Yet favoring incumbent businesses (as long as they stay on his good side) is not the same as favoring healthy free markets. Putin is in some ways a great ally of Russian business, and the country’s economic elite supports him, but Russia’s economy should be seen by intelligent advocates of capitalism as a vision of hell.

The end point of Trump’s vision for the economy would be unrecognizable to generations of innovators. It would sacrifice the openness and opportunity that make America the most enticing destination for entrepreneurs across the world, while locking into place and even celebrating excesses of wealth. If Americans think that by empowering Trump, they have traded away some of their equality, civic decency, and political freedom for prosperity, we may find one day that we have sacrificed them all.

This article appears in the April 2025 print edition with the headline “The Fear Economy.”