When governments become top shareholders, corporate focus shifts from pleasing customers to securing political favor and appropriations. R&D budgets are reallocated to lobbying, and market competition devolves from building the best product to playing the policy game most effectively, strangling innovation.

Liberal democracy’s rise coincided with the need for a productive populace for economic and military strength. As AI replaces human labor and soldiers, the state's pragmatic incentive to empower citizens and protect their freedoms disappears, risking a return to authoritarianism.

A bureaucracy can function like a tumor. It disguises itself from the "immune system" of public accountability by using noble language ("it's for the kids"). It then redirects resources (funding) to ensure its own growth, even if it's harming the larger organism of society.

Authoritarian leaders attack bureaucracy not to enhance democracy, but to replace institutional competence with personal loyalty. Experts loyal to professional standards are a threat. Destroying bureaucratic competence through patrimonialism (treating the state as personal property) is a distinct, earlier stage before an organized, ideological fascist takeover.

According to James Burnham's "Iron Law of Oligarchy," systems eventually serve their rulers. In government, deficit spending and subsidies are used to secure votes and donor funding, meaning leaders are incentivized to maintain the flow of money, even if it's wasteful or fraudulent, to ensure their own political survival.

Government programs often persist despite failure because their complexity is a feature, not a bug. This system prevents average citizens, who are too busy with their lives, from deciphering the waste and holding the "political industrial complex" accountable, thereby benefiting those in power.

Well-intentioned government support programs can become an economic "shackle," disincentivizing upward mobility. This risks a negative cycle: dependent citizens demand more benefits, requiring higher taxes that drive out businesses, which erodes the tax base and leads to calls for even more wealth redistribution and government control.

Intended as a safety net, Britain's extensive welfare system now acts as a trap, creating powerful disincentives to work. With over half of households receiving more in benefits than they pay in taxes, the system fosters a dependency that is difficult for anyone, even the ambitious, to escape.

Immigration policy must account for economic incentives. Unlike in the past, modern welfare states make immigration an economically rational choice for survival, not just opportunity. This shifts the dynamic, attracting individuals based on benefits rather than a desire to contribute without a safety net.