The Shift of Power to Faceless Corporations: Shadows Over Democracy

By Mika Horelli, BRUSSELS – In recent decades, the balance of power in Western democracies has begun shifting in a troubling way from democratically elected governments and public institutions to multinational corporations. This development is especially evident in the technology sector, where large companies, such as the American and Chinese social media giants, have seized a significant share of the faceless power that shapes people's daily lives. These corporations not only control, through their algorithms, what information we see and consume, but also influence the ability of individuals, like myself as a journalist, to do our work: to observe the world, ask difficult questions, and share information.

It is clear that the role of democratic governments is not to engage in consumer trade or manage social media platforms. Instead, their responsibility lies in creating the conditions for businesses in these fields to thrive. The better these companies innovate and serve, the better they can meet people's needs. However, the problem arises when such operations occur without sufficient democratic oversight and are driven solely by individuals whose only goal is maximizing profits.

A personal example brings this issue into stark relief. Some social media platforms have repeatedly flagged my posts as containing "prohibited" content — even though the problem has always been the result of an error in their AI algorithms. This is not uncommon; many of us have experienced similar issues where content is censored or restricted without any opportunity to seek explanation or correction. In such cases, the sense of facelessness is overwhelming. Where is the person to call or email to request a resolution?

AI algorithms have become judges and gatekeepers, whose decisions affect millions of lives but who bear no human accountability. Ironically, the European Union's AI regulation explicitly states that AI cannot be given decision-making power over matters that fall under the responsibility of public authorities. Yet private corporations now wield the authority to make decisions that directly impact citizens' rights and daily lives.

Satellites and the Monopoly Over Security

The shift of power in technology is not limited to social media. Elon Musk's SpaceX is now the undisputed leader in the satellite launch business. Both the United States and the European Space Agency have become dependent on this single company. This dependence grants someone like Musk — known for his impulsiveness — an extraordinary amount of power to influence critical issues of national and international security. When Musk temporarily banned Ukraine from using its SpaceX communications satellites in the war against Russia in 2023, it was a huge political decision for which no one took political responsibility.

However, satellites are not just tools of security policy. They are also central to everyday functions that we take for granted. For example, navigation services like GPS enable travel, rescue operations, and even complex logistics systems. The functioning of these systems is entirely dependent on satellites. If satellites were targeted by an attack or their functionality disrupted due to geopolitical conflicts, the effects would quickly ripple through both daily life and national security.

Power Transfer in Other Areas of Life

The influence of multinational corporations extends to many other areas of life. For example, the digitalization of healthcare has brought new opportunities but has also made services dependent on the systems and infrastructure provided by major corporations. Many healthcare-related data services and applications are controlled by just a few technology companies, raising concerns about privacy and data management. Additionally, who ultimately decides which healthcare technologies or pharmaceutical projects are prioritized and funded? Are these decisions based solely on profit maximization?

Another significant example is the energy sector. As renewable energy production and distribution increase, energy systems have become more reliant on technological platforms often controlled by global players. This dependence can make nations vulnerable in situations where companies change their operational policies or face cyberattacks themselves.

A third example lies in commerce. Online platforms such as Amazon and Alibaba have revolutionized shopping habits but, in doing so, have also taken control of a substantial portion of international trade. These platforms have the power to determine which products consumers see and under what conditions sellers can operate. This weakens the competitive position of local businesses and centralizes power into the hands of fewer entities. It is dangerous if these giant corporations squeeze out national retail companies, potentially reducing economic diversity and the viability of local players.

A similar trend affects media markets. American social media giants like Facebook and Google have absorbed a significant share of the advertising revenue that once sustained national news media. This has drastically weakened the resources of national media outlets, making it harder for them to produce high-quality journalism that serves as the foundation of democratic discourse.

From the perspective of ordinary people, the situation is even more problematic. As individual consumers, we have no way to verify who or what makes decisions that affect us. When a service provider changes its terms or algorithms, the consequences can be significant — yet avenues for complaints are practically nonexistent. This concentration of power in corporations erodes citizens' ability to influence decisions and undermines trust.

One key question is how democracy can respond to this new distribution of power. Traditionally, we have believed that elected representatives and public institutions are responsible for framing the conditions and rules that govern our lives, both as opportunities and constraints. However, multinational corporations, which are not subject to democratic oversight, now define a surprisingly large portion of the boundaries within which we live.

Here in Europe, the EU plays a critical role in this discussion. The Union has sought to establish rules for the operations of technology giants, but this is only the beginning. For instance, the EU's Digital Services Act (DSA) and Digital Markets Act (DMA) aim to impose stricter regulations on large corporations and ensure fair competition. Additionally, the EU's AI regulation is creating the world's first comprehensive framework for governing the use of AI, particularly in high-risk areas like healthcare and transportation. These measures are part of the EU's effort to ensure that technological development serves its citizens and democratic principles.

The question of power shifting to faceless corporations is one of the great challenges of our time. It requires us to consider the role we assign to technology and who bears responsibility for the decisions that shape our society. Without awareness and action on this front, the risk is that democracy will be eroded piece by piece while technology companies build a new world order — one where citizens are more products than participants.