Today: Is there really a “new oligarchy” in America? Quinn Slobodian on why so many Silicon Valley billionaires have gotten so involved in everyday American politics.

+ Developments: Why the Chinese government is spending so much; why the U.S. is bombing Yemen; and why the price of gold is spiking. … Connections: Alvin Canba on why the corrupt and violent Duterte family is still so popular in the Philippines. … Meanwhile: Illegal border crossings into the U.S. are dropping; Japan is readying 1,000-kilometer-range missiles; and Belarusian authorities sentence a teacher for taking 9,000 photos of military installations for Japanese intelligence.

On sale now: The Signal’s second print extra, Altered States …

Firsts among citizens

But the people in Trump’s inner circle aren’t just uncommonly wealthy, even by elite standards; they seem to have remarkable sway. Trump’s point man in the Middle East, Steve Witkoff ($500 million-$1 billion), recently negotiated a mutual hostage exchange between Israel and  Hamas. Elon Musk’s Department of Government Efficiency (DoGE) is meanwhile going through the government bureaucracy, canceling contracts and firing civil servants en masse.

Trump’s inauguration seemed to symbolize this intersection between money and politics, where a handful of the world’s richest men—who’d among them contributed millions to the inauguration—were seated immediately behind the stage, in front of the cabinet itself.

In a speech on January 15, the outgoing U.S. president, Joe Biden, warned that Trump would usher in a new era in which the favored few have captured the government: “Today, an oligarchy is taking shape in America of extreme wealth, power, and influence that really threatens our entire democracy, our basic rights and freedom.” But isn’t money in politics as American as it gets? Days before Biden gave that speech, he bestowed the United States’s highest civilian honor—the Presidential Medal of Freedom—on his longtime friend David Rubenstein ($3.8 billion) and the liberal mega-donor George Soros ($7.2 billion).

So what, if anything, is really new about the influence wealthy businessmen wield in the U.S. administration today?

Quinn Slobodian is a professor of international history at Boston University and the author of Hayek’s Bastards: The Neoliberal Roots of the Populist Right. It’s partly a matter of financial scale, Slobodian says; Trump’s cabinet is several times richer than Biden’s. But it’s also a matter of political style, largely on account of Trump’s billionaire supporters’ new ideological alignment. Slobodian sees the year 2020 as a breaking point for them, not least for Elon Musk. That year, America underwent a series of political convulsions—from Covid-19 mandates to the Black Lives Matter protests to a series of tech-worker walkouts. The simultaneity of these events convinced Trump’s billionaire backers that they now faced a unified and radical left-wing challenge to the very foundations of American society, which they all saw as pointing them in one direction …

On Monday, Beijing announced a major package of new government spending and programs to boost consumer purchasing: wage increases, childcare subsidies, improving medical and pension services, and domestic tourism promotion, among others. Why?

• The country’s economy has been flagging for some time: The unemployment rate just hit the highest level in two years, house prices have fallen in nearly all large and medium cities, and consumer prices have dropped over the past 12 months.
• Consumer spending, or household consumption, has been persistently weak ever since the pandemic. Last week, China’s legislature declared consumer spending as a key economic priority.
• China is facing a protracted trade war with the U.S., as the Trump administration has imposed multiple sets of tariffs aimed at cutting sales of Chinese goods in the U.S. and abroad.

U.S. bombings in Yemen

The United States bombed the Yemeni port of Hodeida on Monday, two days after large airstrikes targeted Houthi rebels in Yemen. Authorities there said 53 people had been killed and nearly 100 more wounded. What’s going on?

• For about a decade, a civil war has ravaged Yemen, as the internationally recognized government—supported by U.S. allies Saudi Arabia and the United Arab Emirates—battles with Houthi rebels, supported by Iran. The rebels have been attacking Western shipping in the Red Sea off Yemen and launched missiles at Israeli forces fighting Hamas.
• Tens of thousands of Yemenis staged demonstrations against the U.S. in Houthi-controlled areas on Monday, chanting “Death to America.”
• Also on Monday, U.S. President Donald Trump said he would Iran responsible for any new Houthi attacks, adding that Iran would face “dire” consequences for them.

A record-high price for gold

The price of gold surpassed US$3,000 an ounce on Monday, an all-time high, as the commodity’s value has risen sharply since Donald Trump took office, though after climbing steadily for many years. Why?

• The price of gold typically rises in times of economic turmoil, as it did during the Great Recession and the Covid-19 pandemic. Today, traders cite worries that Trump’s tariffs and other trade policies will drive inflation higher and economic growth lower.
• Central banks around the world have been buying up large quantities of gold in recent years, as they try to diversify their portfolios away from the U.S. dollar.
• Globally, governments are going deeper into debt, causing large investors to worry about the future prospects of these countries’ economies and currencies—so they’re increasingly turning to gold as a safe asset.

But Duterte had withdrawn the Philippines from the ICC—and yet his successor as president, Ferdinand Marcos Jr., allowed Interpol to arrest Duterte. Why? It looks like politics: Marcos had been feuding for at least a year with the Duterte family. Duterte’s daughter Sara is Marcos’s vice president, and she’s leading in polls ahead of the next presidential election, in 2027.

Limited by law to one term as president, Rodrigo Duterte remains highly popular in the Philippines, despite his apparent disregard for the law, his public calls for the deaths of drug dealers, and his years of authoritarian rule. And Sara Duterte appears to follow the same script as her father.

Why would the Duterte family still be so popular in the Philippines?

In the latest member’s despatch, we return to our conversation with Alvin Canba on the populist style in Filipino politics—and how the kinds of narrative about good citizens being victimized by corrupt elites, which have been powerful in the U.S., Europe, and around the world, have worked for Duterte …

—Michael Bluhm

• Illegal border crossings hit the lowest levels in decades as Donald Trump intensifies migration crackdown through asylum restrictions, military deployment, deportations, and pressuring Latin American governments: “You need to go back to the Eisenhower administration to see anything like this.”
• Japan plans to deploy 1,000-kilometer-range missiles on the southern island of Kyushu next year, capable of hitting North Korea and China, amid concerns over U.S. President Donald Trump’s criticism of the “nonreciprocal” security treaty and regional tensions: “Even if China attacked Japan, there is no guarantee that the U.S. under Trump would do anything.”
• Masatoshi Nakanishi, a Japanese-language teacher in Belarus since 2018, received a seven-year prison sentence for allegedly taking 9,000 photos of military installations for Japanese intelligence: “My activities have caused damage to the security of Belarus. It was a crime.”

• Finding sites and apps that can actually simplify your life and help you be more effective is a challenge. More than 55,000 subscribers count on Wonder Tools—a free, weekly email that catches you up in five minutes on what’s most useful, from new AI services to surprisingly simple productivity apps. Sign up here.

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