Hi folks,

I decided to turn my Lego Model of Corporate Capitalism into a short video to help people get a simple introduction to the entangled webs of the global economy. Please do share it with anyone you think might benefit!

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Chapters

• 0:00 Intro

• 0:29 The State vs Market Myth

• 1:18 Legal Personhood

• 2:23 Capitalization

• 3:21 Shareholders vs Creditors

• 4:50 Corporate managers, suppliers and workers

• 5:57 Do billionaires ‘create jobs’?

• 6:44 The payouts

• 7:28 Corporate politics, automation and regulation

• 8:45 Entangled supply chains

• 9:49 The sectors of corporate capitalism

See also…

In case you missed them, check out my Intro to MMT and The Monetary System in 15 Minutes.

Cheers!

Brett

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So far in our Lego Capitalism series we’ve covered the basic circuitry of a corporation, the basic circuitry of finance, and the more complex centrally-planned transnational circuits within corporations. In this episode we’ll delve into one method corporations use to undermine their workforces. Paying subscribers can access the audio version here

There are many euphemistic phrases that corporations use to disguise their true nature. Take, for example, the idea that they ‘create jobs’. Amazon says this on its website:

It’s a heart-warming story. The executives want you to think that without Amazon these jobs wouldn’t exist, but the reality works both ways: Amazon wouldn’t exist either without these jobs.

We’re often told that Jeff Bezos ‘built’ Amazon (see The Stone Soup Theory of Billionaires), but would you pay him if Amazon was only an idea, without the parcels actually turning up? Of course not. Amazon is only a reality in our world because workers make it real by doing the jobs. Without people organizing the warehouses and delivering the parcels there would be no revenue, which means Jeff Bezos would make precisely zero dollars per day. He’d be like a beekeeper without bees, dreaming of pools of honey.

The reason why Bezos’ net worth goes up by $7.9 million per hour is because tens of thousands of workers are out there knocking on doors, getting into elevators, getting barked at by dogs and so on. Amazon creates jobs because it needs workers to create Amazon every day. If those workers could have their own website, we could imagine it saying something like this:

Our media, however, is often funded by the billionaire class, and has been for a long time, so we have a bias in our language. The newspapers will certainly talk about how a big company ‘creates jobs’ as it expands, but they won’t say that it ‘destroys jobs’ when the workers get fired. No. They create jobs on the way up, but on the way down they simply downsize, rationalize, or rightsize.

But here’s an anomaly. While corporations historically cannot exist without jobs, the managers within them also have a constant perverse desire to destroy those jobs. To understand this, you have to think of a corporation as a dense sub-system within the much larger system of interconnected people that we call ‘the economy’.

If we zoom into that single sub-system, we’ll see thousands of workers plugging into the corporate legal entity, inputting labour to operate the assets so that the entity can output products to customers, so that the financiers and shareholders that originally capitalized the entity can extract more money out of the circuit than what they originally put in. That’s what we covered in A Lego Model of Corporate Capitalism.

In the case of a company like Amazon, the assets will be things like delivery trucks, or data-centre cooling systems, and they will be inputted by external suppliers like car companies and coolant manufacturers, but those assets will remain dormant unless the workers activate them. It’s not like Bezos turns up to operate the data-centre, or to load up the trucks, or to programme the logistics software. So, whenever you see an Amazon delivery van driving past you, that’s someone activating the assets, which is what ends up making profit for Bezos.

Well, that’s the idea at least. To make profit, a company - whether it’s a tea manufacturer or an aluminium smelter - must sell outputted goods and services for a higher price than the input costs of labour and external suppliers. This means that if the managers wish to increase profit per sold good they have to antagonise one of two groups.

1. They either boost the price of the outputted products, which hits customers

2. Or they reduce the cost of the inputs, which might entail dominating over suppliers, or lowering wages for workers

The strategy they go for depends on who has power in the society

1. If the working class is in a strong position, the managers might have to fight for them and keep their wages high, so to keep profits stable for shareholders, the managers will seek to ‘pass costs on to the consumer’. This is a euphemistic way of saying ‘we don’t want to take a hit to our own cut, and we’re scared that our shareholders will pull out if we reduce profits, so we’ll just raise prices and hope that we have enough market power to stop customers leaving’

2. If, on the other hand, the working class is in a weaker position, the managers can screw them with lower wages

There are of course many variations possible (e.g. if the company is in a monopolistic position, it might raise prices and reduce wages), but there’s another classic strategy that can be played to undermine a strong working class. The managers can input machines in their place. This leads to another of those euphemistic phrases, which is the idea that ‘machines take jobs’.

Supplier takes job

Let’s cut through the bullshit and actually look into the circuitry to see what’s happening when a ‘machine takes your job’. What’s really going on is that bosses are just paying a new external supplier for a new asset - a machine.

But who is that external supplier? Well, normally it’s another corporation that outputs machines as its product. Let’s zoom into that machine manufacturer…

Like any firm, they have shareholders and financiers who capitalize them, and then the entity uses that money to hire managers who coordinate workers that activate tools and goods from suppliers, to make - in this case - machines. And, who are the customers? Well, another corporation, which is buying the machines. Let’s fuse the two circuits together.

For the buyer corporation, the machine manufacturer is a supplier, so let’s reorientate the image to see that perspective.

So, the phrase ‘machines take jobs’ really just means that the bosses of a corporation are pulling money away from their workers, and redirecting it to an external supplier. That money appears in the other corporate circuit as money entering in from a customer, and making its way to the managers, financiers and shareholders of that firm.

On net, what’s happening is that the boss is now paying the old worker salaries to the shareholders of the other corporation, who are hiring managers to hire machine builders who have the job of displacing the other workers. The boss class is essentially doing business with each other, enlisting one work-force to undermine another.

If you’re in a booming economy, it’s possible that the boss buying the new tech might use it to simply augment the existing workers, so rather than losing their jobs, they get to operate the new machines to output more with the same amount of labour. In other times, though, the firm will simply aim to output the same amount with less labour, which means the jobs get destroyed, or - to use the euphemism - ‘rightsized’. This phenomenon is called technological unemployment.

Repeat cycle

In a typical economic progress story, we’re told that the laid-off workers will eventually drift into a new position somewhere else, where they can operate the now more powerful assets (built by other workers) owned by the ownership class.

For example, in the 1800s home delivery might have been done by horse-cart. In the early 1900s the riders might be displaced by auto-mobiles - produced by auto workers hired by an auto-mobile company, and bought by the postal company - but as the vans propagate around the system, we end up with newer generations of workers operating them, like our Amazon delivery driver.

According to the standard argument, even if workers are still taking a small relative cut of a firm’s revenue, it will equate in absolute terms to more stuff than before. Over the decades, workers get chased from one job to the next, but it’s imagined that - as a class - they’re also ‘upgrading’ to a higher productivity world and higher standard of living, because the absolute output of society is increasing as automation spreads.

It’s another one of those heart-warming stories, but the thing about economic growth is that it’s not just an increase in stuff. It’s an increase in needs. This is why all the upgrading over hundreds of years hasn’t truly led to any higher level of security for workers. When you look across the globe, with its mass output, you don’t think ‘oh what abundance, ease and relaxation we live in’. No, you think, I better fucking keep up or else I’m screwed.

People are as stressed and strung out as they’ve ever been, because managers just rinse and repeat this cycle forever. In a capitalist system, they always have this requirement to try drive down input costs, and to convert new tech into higher output relative to labour input. You might think the managers will allow you to use automation to have a more chilled job, but that’s a fantasy - they’ll either fire you or require you to produce more in the same amount of time.

To compete as a worker you will always have to be ‘keeping up’ with the latest technology standard. An old horse-cart driver could live a moderately decent life in the 1800s on a fraction of the things you now require to compete in the lowest end of the job market. If you tried to use the same absolute amount of stuff as them, you’d experience a terrible poverty that they didn’t experience with that amount of stuff, because your needs are much higher.

Contradictions of Capitalism vs. Billionaires

In recent years, the managerial class is starting to experience an internal contradiction. That’s because there’s a whole new class of companies that hire machine-builders to create machines - like AI - to replace lower and middle management type functions. They can sell that to the senior management and shareholders of other corporations.

Ah, but it’s not like these machine-builders are safe either. The irony of ironies is that their bosses can hire other machine-builders to build machines to replace machine-builders. That just happened with Meta. Zuckerberg is prepping up to replace his mid-level programmers with AI, created by other programmers.

There’s really only one class of people that cannot be displaced by tech. The ownership class (commonly known as ‘capitalists’). Machines, robots and AI can certainly do work, but cannot own things. Human-created objects - whether a hand-carved walking stick or a powerful datacentre - have no legal rights, so they can’t become machine capitalists that can dislodge the human ones.

So, do you want to know why those big owners of capital - like Bill Gates and Sam Altman of OpenAI - are so interested in universal basic income (UBI)? Well, if you zoom out from the particularities of specific corporations, and look at the big picture, you’ll see that the acceleration of automation tech is destabilising the capitalist meta-circuits.

If you view the economy in the abstract as one singular process in which people contribute to one singular product - like a giant soup - and then get handed vouchers (money) that allow them to claim portions of that product back to consume, you’ll see some interesting patterns.

Historically, the ownership class (who hang around the financial and managerial sector) pays workers less to produce stuff than society as a whole will pay back to buy the resultant stuff as consumers, leaving a big residual to the big owners of capital, who end up with a much higher claim on the stuff - hence them being billionaires.

I know that sounds a bit mind-bending, but here’s the takeaway: in the situation in which the workers are totally cut out from that circuit (i.e. where the massive owners of capital end up with machine empires that produce ‘soup’ for them alone), the workers who built those empires for them don’t just stand there and starve. They take up arms and rebel, and destroy the billionaire class.

This is why some of that class have found themselves thinking about UBI. They see it as a means to redistribute some of the vouchers back to quell rebellion (I mean, they won’t say that, but that’s what’s going on).

This circuitry also might help you to understand a few more things in the news. For example, if you were a strategist hired by billionaires to prevent an uprising against them, what might you suggest? Well, here are some options:

1. You can go down the draconian route, and suggest using the technology to quell rebellious movements. For example, here’s tech billionaire Larry Ellison talking about using AI to monitor and control edgy populations

2. Perhaps you might suggest promoting crypto and day-trading, to offer gambling as a way out of the economic trap (see The Inner Civil War). Combining a get-rich-quick salvation story alongside a libertarian message that poverty is solely your own fault is a powerful combination

3. You can go down the xenophobic route to redirect worker anger towards other groups of workers, to distract them

4. You can combine that with jingoistic nationalism, aimed at convincing workers that they’re on the same side as their local billionaires, standing together as a team with the common goal of ‘beating’ other nations - e.g. Team USA vs Team China

Of course, some billionaires can’t help but try to have their cake and eat it too. Perhaps they exploit that nationalistic fervour to get the government to massively subsidize AI infrastructure for the billionaire class - to win the AI ‘arms race’ against another team. Having won it, the billionaire class of course will also own it, and can then use it to truly fuck the workers of the world.

You see, in the final analysis, the deep and lasting battle isn’t between the US and China. It’s between the ownership class across countries and those who operate the owned assets. Do you think a CEO in Wisconsin, Frankfurt, Johannesburg, Tokyo or Dubai really has some deep allegiance to Team USA’s OpenAI rather than Team China’s DeepSeek?

No, when they decide which of those suppliers they will input to their operations, they mostly care about profit optimization. OpenAI and DeepSeek might have a battle with each other, but the global boss class as a whole doesn’t really care who wins. What they care about is for the winner to cut their costs for them, and we know what ‘costs’ mean in this context: people.

See you next time.

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This is part of my Lego Capitalism series, where I create simplified models to help you visually navigate the complex webs of global finance. Audio version coming soon

We associate central planning with old command-and-control Communist economies, where bureaucrats would sit in a central agency and try to monitor and control what production was happening where: We need 5,000 harvesters to reap the wheat, but the vehicle plants are short on steel, so mobilise the iron ore mines.

Centralized coordination like this is difficult, because supply chains often double-back on each other, with a shortage in one affecting all the others. The attempt to make central planning more nimble even inspired cyberneticists like Stafford Beer, who worked on the fabled Project Cybersyn in Chile in 1971.

Project Cybersyn was an experiment in ‘cybernetic socialism’, but was disbanded in 1973 after a US-backed coup brought a neoliberal warlord called Augusto Pinochet to power. Pinochet immediately set about murdering and imprisoning opponents in order to bring free markets to Chile, a process that would involve letting mega US corporations sidle into the country.

When you really think about it, the idea that corporations represent free markets is kinda ridiculous. Take a company like Walmart, for example. It consists of 2.1 million people, which is similar to the size of the entire population of England in the early 1500s when capitalism was kicking off. Unlike 16th century artisans and merchants, however, the employees of Walmart are almost entirely directed from above through Walmart’s vast internal central planning systems, implemented through hierarchal departments with quotas and performance targets that would make anyone who designs a Soviet Five-Year Plan proud. In fact, this was the topic of the 2019 book The People’s Republic of Walmart.

My Lego Capitalism series has been showing that a corporation is not a single ‘thing’, but rather a system, in which a federation of interlocking groups organise around a legal focal point. In the centre is a legal entity written into existence through law. It gets capitalized by the financial sector and is subsequently controlled by managers that direct its money to mobilize workers and suppliers to run assets that will output goods to customers that will send money back out the circuit to the financiers.

The image above has been useful, but it has one major weakness. It makes it look like there’s a single legal entity that everyone revolves around, when in reality a transnational corporation is an elaborate network of legal entities, called subsidiaries, spread across the world in different jurisdictions, and it’s these subsidiaries that actually hold most of the assets or hire most of the workers or do deals with suppliers. To begin to glimpse this, we must picture the main corporate entity branching out and capitalizing a whole range of sub-entities…

Corporate subsidiary structures can vary in complexity. For example, the British media giant WPP has over 2100 subsidiaries, while Big Pharma giant Glaxosmithkline has a simpler setup, with a moderate 280. In 2014, though, I got a rare opportunity to do a deep dive into the corporate structure of the oil company BP, which at that time had 1180 subsidiaries. I worked with a group called OpenOil to trace how these sub-companies interlocked. The chain started with the mothership company - BP PLC - in London, which then branched out across the world via subsidiary chains that went 12 layers deep. I spent days manually stitching together the connections to come up with this picture…

Doing this gave me a visceral sense of how corporations are feats of legal engineering, elaborate meshes of entities written into existence by lawyers across jurisdictions and bound together via contracts. It impressed upon me just how hard it is for nation states to have any control over these extra-national clusters. It also gave me a glimpse into how these clusters are controlled via central planning systems.

From the London headquarters, BP’s corporate bosses can monitor and control the production of these subsidiaries, and direct them to ‘sell’ the outputs to each other. This is called ‘intra-firm trade’, and it accounts for 30% of world trade. I shit you not - a third of world trade happens inside companies, totally insulated from open markets.

In 2014, BP had around 85,000 employees across 1180 companies. If you showed a person in 16th century England those numbers, they’d think you were referring to an entire economy. Well, it is an entire economy, but it’s entirely subsumed under a single brand name. Let’s take a brief tour through this ‘economy’ of BP in 2014.

The BP Economy in 2014

The first thing to say about the internal economy of a corporation is that it’s privately owned. I’m sure many of you have been served adverts by stock-trading companies that encourage you to open accounts and buy shares of ownership in corporations, but retail shareholders like us only hold tiny crumbs of this ownership. The biggest chunks of corporate shares are held by institutional shareholders, which includes mega funds and even governments. Here’s a sheet of BP’s biggest institutional shareholders in 2014.

The world’s most powerful fund manager - Blackrock - was BP’s biggest shareholder in 2014, holding 5.7% of the company’s shares, a stake valued at around £5.3 billion at that time. The big insurance fund manager Legal and General was holding 3.31%, while US pension fund CALPERs held 0.33%. Also notable are the sovereign wealth funds like Norway’s oil money manager Norges (2.28%), the Kuwait Investment Authority (1.78%) and the People’s Republic of China (2.11%). There were also a bunch of hedge funds, like David Einhorn’s Greenlight Capital (0.09%), and foundations like the Bill and Melinda Gates Foundation (which eventually divested in 2016).

The spreadsheet above only shows the first 57 of 812 institutional investors, and the exact composition would have changed by now, because big investors are always moving in and out of different corporate entities. In a sense, these investors get to dock into, and back out of, different centrally planned economies, picking and choosing them as the rise and fall. So, let’s imagine this list of shareholders docking into the BP internal economy, handing over money for shares.

BP’s Central Planners

These different shareholders who capitalize the company don’t operate the company. Rather, that’s delegated to a team of central planners we call management, who technically work for shareholders (albeit, in reality it’s only very large institutional shareholders, such as Blackrock, that have a direct line to them). Formally, though, all shareholders are supposed to be represented by the board, a hybrid body that has various external executives who’re supposed to keep an eye on managers and make sure they’re doing their job properly.

The chief central planner is called the Chief Executive Officer. The CEO is supposed to be the one with the most accountability, and is also the one to get axed when things go badly wrong in the centrally-planned operations. This is what happened to BP’s Tony Hayward, who was forced to step down after the Deepwater Horizon disaster in 2010. His apologies for this massive oil spill were immortalized in South Park…

Tony was replaced by Bob Dudley, and in 2014 Bob was presiding over a team of senior execs in control of different central planning command posts, such as securing financing, dealing with supply chains, buying up assets, making strategic decisions and breaking into new markets.

The natural habitat for corporate central planners like these is the boardroom table, where they meet to make decisions that have ramifications across the globe.

Just like officials in Communist regimes, who have to hit various targets, corporate central planners must try to please their bosses - shareholders - while trying to maneuver the unwieldy moving parts of the corporation amidst the unpredictable chaos of the world. One of the primary goals of central planning is to get rid of such chaos. The execs must secure the corporation in the world, minimizing risk while maximizing shareholder returns.

But, while old Soviet bosses measured success across reasonably long time horizons like five years, corporate central planners are under constant pressure to show results. This is because shareholders, who previously docked into the BP ecosystem, can detach at any point and join a different centrally planned corporate economy. This competition between centrally-planned systems for financing can lead corporate managers towards short-termism, where they try to boost profits by cutting corners, ignoring environmental damages, or resorting to accounting fraud. One classic way to boost shareholder profits, though, is to use leverage, and that involves getting creditors involved.

Bring in the debt investors

In my Lego Model of Financial Capitalism I showed how a small real estate company might finance a building in chunks with a combination of equity - shares - and debt in the form of loans and bonds…

The example above concerns a mere $100 million, but mega corporations operate at vastly bigger scales. In 2014, for example, BP was raising about $8-15 billion from bond investors each year, relying on investment banks to arrange these deals. Here are some of those deals from that time:

• In Oct 2013 they raised 1.2 billion Renminbi, arranged by Bank of China, HSBC, ICBC International and Standard Chartered Bank

• In Nov 2013 they issued a CA$450 million bond, arranged by Bank of America Merrill Lynch, Canadian Imperial Bank of Commerce, and Toronto-Dominion Bank

• In February 2014 they issued a $2.5 billion bond arranged by Barclays, BNP PARIBAS, Credit Suisse, Mitsubishi UFJ Securities, Morgan Stanley and RBS

• In February 2014 they issued a €2 billion bond, arranged by Credit Agricole CIB, Goldman Sachs, HSBC, Lloyds, Mitsubishi & Santander GBM

Much like you might try to build a credit rating for yourself through strategic borrowing, they deliberately borrow from different debt investors in different regions to keep those investors sweet. Nevertheless, while we can trace who the major shareholders are in BP through regulatory filings, finding out who these lenders and bondholders are is a lot more difficult. What we do know, however, is that they will include many of the same big institutional investors that invest in shares.

For example, the Teesside pension fund is a shareholder in BP, but upon browsing its annual report I found that it had also lent money to BP via bonds issued in Chinese Yuan and Swiss Francs. This means it’s sending money to BP in different forms - sometimes as a shareholder and other times as a bondholder. In any case, it’s useful to view shareholders and creditors as forming a common financing front, collectively financing the corporation side by side.

Financial Central Planners: The Corporate Treasury

All that bondholder and shareholder money that enters BP PLC ends up in bank accounts controlled by the corporate entity. For an external investor, this money seems to enter a black box and disappear, re-emerging at a later date in the form of interest paid out to bondholders and dividends paid out to shareholders.

But what actually happens inside the black box? Well, the money that enters ends up under the command of the Chief Financial Officer, which in 2014 was Brian Gilvary, the central planner in charge of the BP Treasury, a department which, in BP’s own words, acts as “BP’s in-house global bank, ensuring it has the right funding, liquidity and currency in the right amount on the right day, and in the right place."

The Treasury is the interface between the external world economy, and the internal BP economy, in charge of raising money from external investors and then pushing it around the internal BP ecosystem. In fact, the BP Treasury ends up acting as a financier, capitalizing 35 subsidiaries…

These 35 sub-companies then capitalise 152 sub-sub-companies, which capitalise 284 sub-sub-sub companies, which capitalise 223 sub-sub-sub-sub companies. This goes on until we get twelve layers deep. That’s how we get 1180 companies over 84 national jurisdictions. Let’s follow one of these chains across the world.

What’s going on here? Well, BP PLC owns BP Holdings North America Limited (UK), which owns BP America Inc (USA), which ripples ownership through another six US subsidiaries, the last of which owns Pan American Energy Holdings Ltd (British Virgin Islands), which owns Pan American Energy (Uruguay), which owns Pan American Energy Ibenca (Spain), which owns Terminales Mantimas Patagonicas SA (Argentina), which is this…

In the example above, each company in the chain takes the position of an equity investor - it owns the shares of the next company - but they can also start lending to each other. Try follow this convoluted financial circuitry from BP’s Baku Tbilisi Ceyhan pipeline.

• BP Pipelines Ltd is owned by BTC Pipeline Holding Co (UK) which is owned by BP Global Investments (UK) which is owned by BP PLC

• BP Pipelines Ltd, though, is also receiving a loan from BTC Finance BV (Netherlands), which is receiving a loan from BP International (UK)

• BP Pipelines Ltd, though, owns BTC Pipeline Holding BV (Netherlands), which owns BTC Finance BV, which is the one that’s lending to BP Pipelines Ltd

So, we have a subsidiary that indirectly owns the very same subsidiary that’s lending to it, like a parent giving pocket money to their child and then borrowing it back. Who knows why BP’s legal engineers decided to create this particular structure, but - in general - these weird chains of subsidiaries are designed to get around various national laws, and - especially - to avoid tax.

To understand this, we need to realise that these company chains act as conduits for the BP entity to snake out across the world. The central planners take that money that originally entered via players like Blackrock, and they cascade it through the subsidiaries in the form of equity or debt, which will end up being used to buy up assets and mobilize workers to make stuff, which will be sold for money that will be drawn back up the elaborate company chains via dividend and interest payments, to eventually exit out the mothership in London, and to Blackrock (and maybe to you).

At a generic level, what’s happening here is money going out, and then being sucked back, but it makes a difference as to what legal classification the money has. For example, if BP wants to push money to a subsidiary that does operations in a distant high-tax jurisdiction, it might make sense to channel it as a ‘loan’ (via another subsidiary in the Cayman Islands, for example), because this will allow the central planners to suck the money back out in the form of pre-tax interest, which has different tax treatment to dividends. This practice is sometimes called BEPS - base erosion and profit shifting. Essentially, the central planners take a profitable subsidiary and ‘erode’ its profits by pulling the money out in disguised forms, such as consulting, licencing or management fees paid to another subsidiary. This is a core pillar of transnational corporate tax avoidance.

When looking at these strings of subsidiaries, you need to see them as a fossil record of attempts to optimise profits across the world, each chain being but one circuit within a meta-circuit. In fact, if we trace all the subsidiary connections that emmanate out of the aforementioned BP Global Investments, we get this…

The politics of captive capitalism

Not only does BP have a centrally-planned ‘captive’ financial system within itself, but it has an entire captive economy. If companies have corporate personhood, then subsidiaries are like corporate sub-persons, dominated by the main company which can make them do deals with each other, lend to each other, or charge each other too much to erode revenue in one country and make it appear somewhere else.

In the end, though, these complex chains of subsidiaries are but hollow legal entities that need actual people to do the work. BP’s senior managers might be in London, and might be accountable to players like Blackrock, but they need workers across the globe to turn up in distant operations in Nigeria or Australia, or at Termap in Argentina. Each country they operate in might have separate union laws, environmental regulations (or lack thereof) and labour conditions. Each country also has its own political elites that want placating. So, being a senior manager in a transnational corporation is inherently geopolitical, especially in the case of companies like BP, which control access to strategic energy sources.

In the capitalist system, profit emerges if input costs are lower than output revenues, so to reduce the former managers might seek to drive down wages of workers, and dominate over suppliers, each of which carries its own geopolitical risks.

More generally, managers might seek to play parties like that off against each other by replacing (or threatening to replace) workers from one country with machines that they buy from suppliers in another. At the same time, they might face pressures to keep stability, and that may involve trying to reward loyal workers, buy off local politicians, or to grant suppliers long-term contracts to keep them aligned. The day-to-day life of a BP manager, then, involves balancing off a range of parties, cutting tax deals with different governments, or lobbying against new policies that may affect them, all while trying to suppress worker unions.

Above all, though, our central planners will be paranoid about fending off other central planners who coordinate other companies. After all, they face humiliation if they lose market share, and may even face getting fired by the board for failing at their task. One of their worst fears is being targeted by a powerful activist shareholder who will buy up shares in order to get a board seat, from where they can harangue the CEO. For example, Disney’s senior managers recently defeated the activist investor Nelson Peltz…

We seldom feel sorry for these senior managers, especially because they get paid millions, but they often project their own stress downwards to more subordinate middle-managers. To this day, one of the most entertaining series that covers middle-management life is The Office (US), which follows Michael Scott, the hapless branch manager of a regional paper corporation, as he tries to be a nice guy that keeps his workers happy while he faces top-down pressure from ‘corporate’ (the name he gives to the distant senior management). Even within his branch he finds himself having to navigate between the demands of the white-collar workers upstairs and the blue-collar workers in the warehouse below.

This series perfectly captures the ‘sandwiched’ experience of a middle-manager, caught between different levels of the corporate structure. In many ways the job of Michael Scott is not dissimilar to the job of a local party functionary in a municipality in North Korea. He’s supposed to take charge of a small fiefdom, and must fall if he doesn’t. We’re trained to see Capitalism and Communism as diametrically opposed entities, but in reality, human society is not dualistic like this. Every capitalist system has many centrally-planned elements, just like every communist system has many market elements. Much of it comes down to what you want to see.

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Dear readers: this piece builds upon my Lego Model of Corporate Capitalism

Our economies are held together by money, and - most of the time - we hand it over in exchange for goods or labour. Occasionally, however, we hand it over in exchange for future money. For example, if you buy a share on the stock-market, you’re handing over money for a contract promising you a cut of the future profits of a company.

This type of exchange, in which we exchange money for promises-for-future-money, is called financial exchange, and the financial markets are where it happens. Like many markets, the financial markets have a retail side - the smaller players like you and me - and a wholesale side, the mega players like funds, commercial banks and investment banks. The latter players cluster in big cities like London, New York, Singapore and Hong Kong, and in A Lego Model of Corporate Capitalism I showed them taking the lead on capitalizing international corporations. They ‘charge up’ corporate entities with money in exchange for financial contracts like shares and bonds, after which the corporates can blast that out to mobilize workers and suppliers to produce stuff…

That stuff is then is sold to customers, and the revenues are refracted out as bonuses to management, interest to creditors, taxes to governments and dividends to shareholders.

Building a Lego balance sheet

The company shown above is some kind of industrial corporation, but let’s start from scratch in a different sector. Let’s say you’re actually a wealthy property developer who wants to build a luxury office complex for startups in down-town Manhattan. You envision a 6-storey building with open-plan workspaces, a meditation den, a fitness spa, and even sound-proofed booths for therapeutic screaming when the existential emptiness of yuppie life kicks in. Here’s the vision:

Above I said ‘you want to build’, but that’s just a colloquial figure of speech. It’s not like you’re going to turn up with a spade and trowel to lay foundations for this building. No, what you actually want is for a thousand builders with specialist skills, equipment and materials to turn this vision into a reality. You nevertheless want to claim ownership of what they build, so to make sure they have no ownership rights, you need to approach them as suppliers selling goods and services in the open markets. That’s going to cost you about $100 million.

The way to obtain that money is through financial exchange: you need investors to give it to you in exchange for promises-for-future-money. Investment banks are specialists in convincing big investors to do this, but this is a small-ish project and you don’t want a massive investment bank like Goldman Sachs. Instead, you want a small boutique investment bank. You find one called BlueGate Partners. On their website they describe themselves as follows:

That phrase ‘debt and equity capital’ is finance slang for creditors and shareholders who will put in money for different promises-for-future-money. ‘Equity investors’ are shareholders: they put in money in exchange for shares of ownership that will entitle them to a morphing stream of future money (dividends). ‘Debt investors’ are creditors: they put in money in exchange for a promise for an fixed amount of future money (interest and principle). The promise given to equity investors is relative - the returns depend on how well things turn out - while the promise given to creditors is absolute - the amounts remains the same regardless of circumstances. From a legal perspective, absolute promises tend to be senior: they get dealt with first if everything goes to shit (which becomes particularly important in bankruptcy proceedings).

Equity and debt investors will jointly capitalize projects or companies alongside each other. That said, the specific balance of power between them - and between the relative and absolute promises they’ve extracted - can create some interesting properties. One of these is leverage, the phenomenon by which debt investors amplify the returns of equity investors in exchange for protection (equity investors agree to absorb the first losses in a project, but also get to claim amplified gains). Leverage increases as the ratio between debt investors and equity investors increases, so the first thing you and BlueGate will work on is the optimal mix of equity and debt. BlueGate suggests a ratio of 1:4, with 20% equity and 80% debt.

Raising equity

Phase 1 is to deal with the equity chunk, which will be $20 million in total. BlueGate and your laywers set up a new legal entity, which you name Bloks Inc. You’re going to be the lead investor, and will put in $5 million of your own money for 25% of the shares. BlueGate assures you that they are experts in ‘equity placement’, and can find a home for the remaining 75% of the shares. They have many friends at funds who can be convinced to put up the other $15 million.

After a few weeks, and a range of meetings, BlueGate’s team secures pledges for $5 million from a ‘family office’ that runs money for the super-rich, $5 million from an offshore fund, and $5 million from a local property investment fund. The $20 million equity chunk is now ready, but it will only be enough to cover the planning, permits, foundations and ground floor.

Raising debt

So, Phase 2 of the plan is to raise $80 million in debt financing. Again, BlueGate showcases their extensive ties to the super-rich and the super-big:

They want to create a blend of different debt investors (creditors), so their first step is to approach two commercial banks. They get each of them to grant you $20 million in credit (incidentally, this will involve those banks creating new money). This $40 million can probably scrape you another three floors…

There’s still one more normal floor and a fancy roof level to be financed, plus all the trimmings, so BlueGate now approaches a range of specialist funds and high-net-worth individuals to convince them to buy bonds. ‘Buying a bond’ is just the act of lending money in exchange for a fixed-promise-for-future-money encoded into a tradeable contract (‘bond’).

Now that both the equity and debt financing is in place, let’s zoom out and see our Bloks Inc. corporate circuit in action. Imagine the money from the creditors (debt investors) and shareholders (equity investors) charging Bloks up like a battery. That money is then blasted out to mobilize a small army of contractors, suppliers and construction workers who will make the building emerge out of the ground as the money runs down.

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As the workers leave, you’re left with part ownership of a completed building, alongside a bunch of other financiers who also want a cut. To realize that cut, however, you need to make a profit, but where’s that going to come from? You need a customer…

You consider trying to manage the property yourself, finding renters who will pay. In this case your customers would be startups buying access to the building. Alternatively, you can just try flip the building by selling the whole thing to some much bigger property holder. You decide to go with this latter strategy, and BlueGate even has a bespoke service to help you find a buyer for the thing they helped finance. They introduce you to a major real estate investment trust (REIT), that has a pre-existing portfolio of buildings that they own and rent out.

From the perspective of this REIT, Blok Inc. appears in their world as a new potential supplier trying to flog them a new asset to add to their existing portfolio. The REIT boss instructs his analyst workers to do an assessment of your building…

The sale

Let’s assume that the REIT decides to buy the building. This is where leverage can get fun. If the rental market is solid, the analysts might suggest a price of $120 million for the building. From the combined perpective of the equity and debt investors in your project, that’s a 20% profit relative to how much the building cost to build. Nevertheless, given that the debt investors’ cut is absolute - it stays fixed - none of that relative increase goes to them. The entire increase accrues to the equity investors, which means - relative to their opening stake - their money just doubled from $20 million to $40 million (with your personal stake going from $5 to $10 million). That’s leverage for you. It’s sometimes called ‘gearing’, because just like a gear might amplify the affect of a foot pressing down on a bicycle pedal, leverage transmits an amplified positive return to the equity stake. Here’s a simplified representation (it’s simplified because the amounts shown don’t account for interest owed to debt investors, but let’s just ignore that):

Unfortunately for you, gearing works both ways. If, for example, the building gets completed just as a global pandemic hits and demand for office space plummets among tech startup workers, the analyst valuation of the building might crash to $90 million. This hits the equity investors first. In this case, a 10% loss relative to building costs crushes the equity by 50%. You get an amplified version of the loss. The debt investors take their absolute share and leave. BlueGate mourns your loss, after which they take their advisory fee - which might significantly eat into that remaining slice you have - and leave.

Calling all lecturers and professors: Next week I have the pleasure of presenting my Lego models to students at Stony Brook University in New York. If you’d like me to talk to your students, drop me a line!

Playing the Advanced Finance Game

What I’ve shown above is pretty basic finance, and there are two things to say about basic finance. Firstly, it’s built upon a much deeper and richer foundational layer of ecological systems, human beings, politics and - eventually - monetary systems, all of which I cover in my Intro to Economic Life course.

Secondly, basic finance can be massively complexified. There are many exciting, and increasingly dodgy, things you can do to play a more advanced finance game, such as:

1. Offshore finance: build complex legal structures, like a shell company that owns a shell company that lends to a shell company that is also owned by you, so that it can buy the shares

2. Financial engineering: create new and weird combos and hybrids of debt and equity (e.g. Silicon Valley thrives on ‘convertible notes’, debt instruments with inbuilt options that can convert them to equity)

3. Finance your financing: In our original scenario above, you were required to put in $5 million, but you could borrow $4.5 million of that from another bank (or other debt investors), which means you could put in $500k to get a 25% equity stake, which means you’re now leveraging your leverage! (something that hedge funds are notorious for doing)

4. Securitization: the original banks involved might take their stakes and place them in a new offshore vehicle, alongside 1000 other loan contracts they’ve harvested, after which they can ‘tranche’ that package into different equity and debt slices that can be sold off. Now the combined interest that accrues to the pool of loan contracts can get refracted out like a monetary rainbow to a whole range of new investors, some of whom might insanely leveraged

5. Derivatives: you might make bets on the side to protect yourself against changes in the average price of properties (e.g. property index derivatives), while the banks might be using interest rate derivatives to manage various aspects of their exposure. Perhaps your bond-holders might pay away some of their interest into a credit default swap (CDS) offered by an investment bank, in exchange for compensation in the event of your bankruptcy

6. Mix it all up! Perhaps that investment bank can take the other side of that credit default swap, and place it - alongside other CDS contracts - into a new offshore vehicle. Now they can sell the tranches of that new SYNTHETIC CDO! This is highly recommended if you wish to trigger a global financial crisis.

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I adored Lego as a kid, and now I have a fantasy about approaching the Lego company to propose a new thematic line. My proposed series, which will be called Lego Corporate Capitalism, will help kids understand the economy they’re born into. It will come as 7 box sets that fit together, with scope for loads of expansion sets.

There’s no beginning or end to corporate capitalism. It’s a fractal and circular system where the outputs of one part are inputs to another. We touch different parts of it every day, but it’s difficult to see in its entirety. That’s why providing kids (and adults) with a simplified tactile version of it would be useful. Let’s begin with the base set.

The Starter Pack

I was born into the 1980s when state-versus-market rhetoric was at an all-time high. By this time, free-market theorists had popularized the idea that the public sector made the private sector weaker, but in reality there’s no such thing as large-scale capitalism without large-scale nation states. The world’s most powerful companies reside in the world’s most powerful states, and, inversely, the world’s weakest ones reside in the weakest states. Modern markets are underpinned by a public sector substrate, and corporate and state power are a symbiotic unit. So, the Lego Corporate Capitalism starter set must contain a basic collection of state institutions, with military, law courts and CIA agents.

When you step out into the economy, you’re not stepping out into a lawless void. You’re stepping into a forcefield of private property rights backed by state power and connected together via state infrastructure, roads, money systems and so on. We’re going to abstract all of that into a green state base-plate, like this.

This base plate forms a foundation to lay out a new corporation. At the beginning of humanity, there was no such thing as a corporation. You’d have groups of people that might act together, and they might give their group a name, but nobody was under the illusion that the named group existed separately from its underlying people. Modern laws of incorporation, however, sever this connection. Corporations are a creature of law, artificial legal entities that are seen to have ‘personhood’ in themselves, such that they can exist independently of the people that activate them (i.e. those who work for them or direct them). At the core of corporate capitalism, then, are a series of hollow shells, empty legal vessels with no soul that act as centre points around which all the players will gather.

The Lego Corporate Capitalism starter set comes with a circular representation of one of these corporate entities. It’s hollow centre can be filled up with a logo and a name. For now, let’s just call it Hollow Shell Inc.

Now we can pretend that this thing has personhood and can do stuff. You’ll see this fantasy in action every time you see a news item that says ‘Pfizer releases new dieting pills’, or ‘Microsoft starts a new AI unit’ or ‘BP invests in Turkmenistan’. These entities are being spoken of as if they have agency in themselves, but BP is a conglomeration of over 67,000 people (not to mention hundreds of thousands of others involved in its supply chain), but ‘it’ is spoken of as if it were a big giant walking around. In reality, Hollow Shell is just a fulcrum point for thousands of actual human beings, and it will do nothing unless they turn up. To get them to turn up, however, it needs to be capitalized.

The Finance Editions

To be able to act in the world, Hollow Shell needs a bank account, but that account will initially be empty. Capitalization is the process whereby the empty corporate vessel’s account is charged up with money - like charging up an empty battery - and the financial sector is where we go for that.

The mainstream financial sector is largely constituted by commercial banks, investment banks and mega funds (e.g. pension funds, insurance funds, sovereign wealth funds, mutual funds, hedge funds, private equity funds and venture capital funds), all of which operate within a multi-layered monetary system underpinned by central banks (I write a lot about that monetary system on this site, so I’m not going to focus on it in this piece). One basic role of the big funds is to pool the money of various smaller players - such as pensioners - and one basic role of the investment banks is to then corral these funds into capitalizing corporations. When doing this, the big funds can take on two basic personas: shareholders (equity investors) or creditors (debt investors).

Shareholder Edition

Shareholders - or equity investors - are institutions and people that will give money to Hollow Shell in exchange for an ownership stake in it (a share) that will enable them to claim a slice of its profits in future. If Hollow Shell does well, they’ll do well. If it does badly, they’ll do badly.

Creditor Edition

Additional financing can be secured from debt investors, otherwise known as creditors. These are people and institutions that will grant money to Hollow Shell in exchange for a contract that entitles them to a fixed stream of future interest payments regardless of how well the company is doing. If the company’s fortunes skyrocket or plummet, the creditor’s claim remains constant.

Creditors include bondholders, but also banks. In a more advanced future version of the Lego Corporate Capitalism line, banks will get their own edition, because - unlike other creditors - they have money-creation power (i.e. when ‘lending’, they’re issuing money). For now, though, let’s just lump bondholders and banks into a single category.

The basic finance game

The two classes of financier above give the same thing - money - in exchange for the same thing - a contract for future money, but their terms are slightly different. The creditors demand a fixed amount back in future, while the shareholders get the right to a fluctuating amount, so take on more risk in exchange for the potential to get a massive upside if the firm does really well. There’s a whole world of financial engineering that can be done by combining these classes of financier into weird combinations, or playing them off against each other. For example, shareholders can use creditors to amplify their returns (‘leverage’), while creditors use shareholders as cannon-fodder to take losses. Regardless, these classes of financiers collectively ‘charge up’ Hollow Shell with money.

The Manager Edition

Hollow Shell has now had its bank balance charged up, but it’s a legal entity with no mind, body or desire, so it’s going to need some management before it can start using that money to buy stuff. The Lego Manager Edition gives you get a whole host of potential managers that can be hired. The set comes along with a management conference room that docks into the corporate shell to take the controls. Once in place, the management team can use Hollow Shell’s bank balance to buy assets, like facilities, cars, machines, land, IP rights, datacentres, and so on.

The Worker Edition

Managers set strategy, make decisions and direct Hollow Shell to buy assets, but it’s not like they’re going to work the machines, code the software, or drive the cars. So, the next major task for the management team is to direct Hollow Shell to hire workers to do that stuff.

In our economic system, corporations often act as gatekeepers to production. They have priority access to financial markets, and use those to get money to buy up assets that workers must then try get access to. When you’re applying for a job you’re essentially competing with other workers for the right to activate a company’s assets (or to access the means of production). The Lego Worker set comes with a range of proletarians who can be made to fight each other for the right to survive.

A few hundred years ago, these workers might have been slaves, in which case they’d also be considered assets of the company, but nowadays workers are tethered to the corporate shell by labour contracts. Once they’re in position, the bosses can boss them, getting them to activate the assets (e.g. by getting on the computers, or in the factory, or doing whatever it is that the company does).

Hollow Shell will never do anything unless workers activate its assets, so corporate profits stem just as much from workers as they do from financiers or managers. We’re used to hearing billionaire shareholder-CEOs claim that they ‘create jobs’, but in it’s equally valid to say that all those jobs ‘create billionaires’, and enrich the financial sector. This is because the shareholders, creditors and managers will literally make nothing unless the assets owned by Hollow Shell are actually operated by somebody.

The workers get paid relatively small fixed sums (wages, salaries) to operate the assets, which is what the shareholders are relying upon in order to extract what Marxists would call ‘surplus value’. The reason why Jeff Bezos makes $35 million per day is not because he does any work. It’s because he owns the shares of the hollow shell that owns the assets that are activated by Amazon workers, those people in the warehouses and the drivers who turn up at your door.

This is a major source of class struggle. One of the great chain-reaction battles in capitalism occurs when shareholders pressure managers to extract profits, which makes them attempt to drive down wages and to replace workers with machines. This is one reason why managers love to automate (unless the automation threatens their own jobs, which - in the age of AI - it’s now doing).

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The Supplier Edition

Hollow Shell doesn’t internalize all its operations. Large parts of its production processes will be outsourced to other companies (also hollow shells with managers controlling workers). We call these suppliers, and they form the supply chain. Sometimes these supply chains are rigid, fixed in place by long-term contracts, and at other times they’re fluid. The Lego Supplier Edition is a bonanza of components, services and goods that can be inputted into Hollow Shell’s production. This means production now takes place using both internal and external workers.

Corporate capitalism is an ecosystem, with mega corporates serviced not only by other corporates, but also by thousands of smaller SMEs and individual contractors. ‘B2B’ (business-to-business) firms specialise in being suppliers, providing components or services to other businesses, and never touching ‘the consumer’ (who we’ll meet below). All these supply chains can double over each other and get entangled: a car company might input plastics from a plastics company, which inputs petroleum from an oil refining company, which inputs both cars and plastics outputted by the previous two companies.

These supply chains are also a major frontline of economic politics. For example:

• Managers can intimidate their local workers by threatening to outsource to foreign suppliers with foreign workers. Alternatively, they can buy machines from an external supplier to replace workers. That machine will be made by other workers, but sold from hollow shell to hollow shell at the order of the managers, who are essentially getting workers to indirectly undermine each other like this

• Worker contracts are normally long-term, but managers can erode that by turning the workers into freelance ‘suppliers’ or external contractors instead of employees. Companies like Uber, for example, will call it’s workers ‘partners’ or ‘entrepreneurs’. Uber drivers do exactly the same job as a driver employed by a taxi company, but without a fixed contract or wage. In exchange for losing job security, they have the option to not turn up to work, but on average Uber knows that they will (and the workers are incredibly replaceable)

The Consumer Edition

Workers, whether employed by Hollow Shell or its suppliers, will collectively bring goods and services to life, but the products they produce are not owned by them. They are owned by Hollow Shell, and for it to extract profit it needs to sell those goods. The Lego Consumer Edition is where the back end of capitalism meets the front end. It provides a range of consumers, people who browse around in shops or online, looking to buy stuff.

In mainstream economics, the consumer is often casually imagined to direct the global economy through their buying choices, like little entitled brats that force managers to do their bidding. In reality, consumers have far less power than is often attributed to them, and are also often abused in various ways and infantilized by marketing. They supposedly make free choices, but in reality are also coerced by various systemic forces into endless consumption, and often have to buy stuff to keep up with an accelerating economy that threatens to ‘leave them behind’ (See Tech Doesn’t Make Our Live’s Easier. It Makes them Faster).

As they hand money over, the product or service - at least in theory - detaches from the corporate entity and enters their ownership. I say ‘in theory’, because nowadays the product often remains attached to the company in some way, like a Tesla car that harvests your data and requires you to seek constant upgrades from its parent company. This wave of algorithmic surveillance capitalism is a particularly virulent new form of corporate capitalism (see The War on Informality), but regardless of the form, the act of handing over money in an act of consumption completes the first half of the corporate circuit. Now that money can ripple back to Hollow Shell for the second half.

Completing the Circuit

The income from selling stuff now gets split into different cuts for different parties. Managers get bonuses, creditors get interest, and governments get tax (well, assuming the company hasn’t done large-scale tax avoidance). This leaves the residual as net profit. The managers then get to decide if that will be paid out as dividends to shareholders, or reinvested into further operations. This is the basic corporate capitalist circuit in completion.

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Mediating the relationships: Expansion Packs

Each relationship between the different players above carries its own tensions and dynamics. We can explore those by adding Lego Corporate Capitalism expansion packs, which introduce various institutions to mediate those relationships. Here’s a rough sketch of the expanded corporate universe.

• The Board Edition: the board mediates relationships between shareholders and managers, which is an element of corporate governance. For example, the board might vote to grant managers stock options, so that the latter think like shareholders

• The Union Edition: Unions try to mediate relationships between workers and managers (and, by extension, shareholders). Without it, workers have little individual power to fight for a better position for themselves

• The Regulator Edition: The regulator expansion pack gives tools to control various aspects of the relationships. Financial regulations set rules about relationships between companies and financial markets (e.g. is management allowed to do insider trading of the company’s shares?) Labour regulations focus on relationships between companies and workers (e.g. is the company allowed to refuse workers paid sick leave?). Consumer regulations deal with relationships between the corporate entity and customers (e.g. should food products have to include a list of ingredients?)

Lego Corporate Capitalism Fractal

Lego has various lines, like Technic, that cater to older kids and teenagers who get bored with the simpler stuff. In future we can add a Lego Corporate Capitalism Fractal line to expand the complexity of the picture.

The basic Lego Corporate Capitalism line builds itself around a single Hollow Shell, but a true corporation is actually a giant federation of hollows shells. For example, I mentioned earlier that BP is a collection of over 67,000 people, but what we call ‘BP’ is also a collection of over 1000 subsidiary companies, each of which is technically a separate entity, but all of which are linked together under a single parent company. The image above comes out of some work that I did in 2014, in which I mapped BP’s corporate structure. The mothership legal entity is called BP PLC, but it then owns subsidiaries that own subsidiaries that own subsidiaries, and so on. In fact, the subsidiary structure is twelve layers deep.

This is one area where my picture above starts to get fractal, because the parent company, which has its own shareholders, will in turn insert itself in as the shareholder for its first layer of subsidiaries, which become shareholders of the next layer. A true corporation contains thousands of micro versions of the corporate structure within itself. Subsidiaries can take on the role of creditor to other subsidiaries (especially when the company management is trying to do various tax shenanigans), or supplier: indeed, these subsidiaries are made to ‘do business’ with each other, while being directed from the central planning headquarters. What we call BP, then, is actually an entire sub-economy in itself, with hundreds of thousands of people stretched out across countries, merging into other corporate sub-economies.

The connections

We can deepen this complexity even further when we notice that our economy is a huge interdependent structure where each person can take on multiple different positions at once. As you walk into your office you might be a worker, but when you go to the store you’re a consumer. Perhaps your company does work for other companies, in which case you contribute to a supplier. You might also have a pension, which is managed by a fund manager that’s investing in the shares of the very company you work for. Maybe you’re hoping that these small shareholdings will someday enable you to escape from working at that very company.

Learning to see these connections is crucial for understanding economic politics. For example, companies often brag about how they’re reducing prices for the consumer, but that often entails them driving down wages for the worker. Those workers, in turn, can be placated by giving them small slices of the action from the stockmarket, so they have a small stake in exploiting themselves.

The financial sector too has its own fractal universe. I presented it this time as plugging itself in to capitalize the corporate entity, but it can plug itself in all over the picture. It can finance the suppliers with trade finance, finance the consumers who go into debt to buy the products, and even finance the people training to be workers for the financed corporation. It will also finance financiers, who may be doing the same.

The fractal patterns go both smaller and larger. Zoom out, and the picture of a single corporation becomes a picture of entire industries that lock into other industries, and entire classes of people locked into forms of tense and unstable symbiosis within a giant web of financial contracts. And, this entire structure can only be woven together because of the money system.

That, of course, is the glaring missing piece from the picture above. I abstracted money away from the picture this time for simplicity, but the true Fractal series that we all need to grapple with in future is how corporate capitalism and monetary systems are part of the same continuum, with no beginning or end.

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