Flags of the United States and China on flagpoles on sides. Six flags on a blue background. America. USA. Washington. Beijing, Hong Kong. 3D illustration.
Flags of the United States and China on flagpoles on sides. Six flags on a blue background. America. USA. Washington. Beijing, Hong Kong. 3D illustration.

Elite Capture, What It Is and How It Threatens America’s Future

Originally published at Townhall

One explanation for why America is in such rapid decline with the woke normalization of censorship, cancel culture, division, unequal justice, and depravity is found in the theory of “elite capture.”

Elite capture has been mastered by the Chinese communists (CCP) and it has proven far more successful in subverting America than the prior efforts by the Soviet Communists, who did succeed in the FDR and Truman administrations in controlling dozens of agents in the U.S. government. One such agent, Alger Hiss, was FDR’s right-hand man at the Yalta talks, and assisted Stalin sitting across the table to gain control of 10 Eastern European countries in the post-World War II world.

While the CCP uses front groups for propaganda, they have mastered all manner of techniques with an emphasis on infiltration to influence, compromise and co-opt elites so as to “capture” them. Typical targets include university professors and scientists, media executives and reporters, and political, and corporate leaders.

Elite capture, first developed in China, was a form of corruption whereby rural elites used their authority and influence to abuse public resources and monopolize the planning and management of development projects for personal gain at the expense of the larger population. Now the CCP uses it as the primary means in expanding the Belt and Road Initiative (BRI) all over the developing world, and to subvert developed countries, with a primary focus on the United States.

With China running a multi-billion-dollar trade surplus with the United States for many years, it has a huge stockpile of U.S. dollars to facilitate elite capture through generous funding of bribery, but also through granting access and favors within China. And when elites take the bait, over time many find it difficult to admit fault and extricate themselves, and they may even choose to see their interests and those of China interconnected or even identical.

It took more than a decade from the opening of China orchestrated by Nixon and Kissinger in February of 1972 for trade between the United States and China to commence. And the CCP was initially more open to American companies manufacturing in China than selling their products in China. By the 1990s, China’s position as the preeminent low-cost manufacturing platform for American companies was well established.

Fast forward to today and we find that industry leading American companies such as Apple, Hewlett-Packard, Cisco, 3M, Wal-Mart, Hasbro, Mattel, Gap, Nike, and others manufacture far more of their products in China than anywhere else. We learned through the Covid-19 experience that 80 percent of the basic components known as active pharmaceutical ingredients (APIs), come from ChinaAll companies doing business in China have learned to remain silent and not criticize the CCP, especially regarding corruption in government and human rights violations, such as the persecutions and forced labor of the Uyghurs in Xinjiang and the Tibetans in Xizang.

Today’s CCP takes heed from Mao’s 10-year Cultural Revolution in China that began in 1966. They see cultural influence as paramount because it is upstream of politics and is the single most important force in shaping politics. Thus, they have executed on partial elite capture of U.S. media and Hollywood studio assets in the last 10 years, acquiring controlling interests in some 12 leading Hollywood and media companies, such as AMC Theatres, Carmike Cinemas, the Legendary Jurassic World Production Company, Dick Clarke Productions, STX Entertainment, IM Global, Studio 8, Riot Games and more. With China being one of the largest markets for big screen movies, most American production houses now self-censor—avoiding any criticism of the Chinese government or mention of Taiwan, Tibet, or the Uyghurs.

With media conglomerates being multidimensional, it’s impossible for their news entities to remain insulated from Chinese influence. Conflicts of interest resulting from Chinese relationships between not only Hollywood and the news media but also theme parks, cellular and cable networks, and movie theaters—with nearly all the products they sell manufactured in China—are inevitable. The same Disney that owns ABC has a theme park in Shanghai, and it also owns ESPN. In turn, ESPN has a multibillion-dollar content-rights deal with the NBA. LeBron James is the biggest American basketball star in China and the center of the Nike-NBA industrial complex has defended the CCP crackdowns in Hong Kong.

Without a doubt the greatest elite capture by the CCP has been the Joe Biden family, which started at least as far back as 2013 when Hunter accompanied his father on a trip to China. Significant payments to the Biden family started a few years later.

After studying the documents on the Hunter Biden laptop, former criminal prosecutor and New York City Mayor Rudy Giuliani concluded that: “What Hunter Biden is is a bagman…I’ve prosecuted many cases like this. He’s collecting Joe’s bribes that come to about $12 million from Ukraine and $3.5 million from Russia. But the really big money comes from China. And the amount of money involved is literally in the tens of millions of dollars.” Today, there is documented proof that that the Biden family has received at least $31 million from entities controlled by the CCP, with greater Chinese payoffs yet to come.

Rudy Giuliani sums up what ultimate elite capture looks like, stating: “The Biden Family is owned by the Chinese Communist Party.”

We will conclude where we began with more insight about why America is in such rapid decline. The normalization of censorship, cancel culture, unequal justice, depravity, and forced critical race theory indoctrination of the military in America today is all related to “elite capture.”

A solution to our predicament can start with taking heed of George Washington’s warning to the nation in his 1796 Farewell Address: “Against the insidious wiles of foreign influence the jealousy of a free people ought to be constantly awake, since history and experience prove that foreign influence is one of the most baneful foes of republican government.”

Scott S. Powell

Senior Fellow, Center on Wealth and Poverty
Scott Powell has enjoyed a career split between theory and practice with over 25 years of experience as an entrepreneur and rainmaker in several industries. He joins the Discovery Institute after having been a fellow at Stanford’s Hoover Institution for six years and serving as a managing partner at a consulting firm, RemingtonRand. His research and writing has resulted in over 250 published articles on economics, business and regulation. Scott Powell graduated from the University of Chicago with honors (B.A. and M.A.) and received his Ph.D. in political and economic theory from Boston University in 1987, writing his dissertation on the determinants of entrepreneurial activity and economic growth.