I agree that psychopathy has its advantages. We need look no further than where malignant narcissism has taken Trump. And I agree that democratic government and capitalism are different environments with different checks and balances.

But I think the formation of monopolies is inherent in capitalism, which is to say that if left to its devices, capitalism isn't self-regulating but self-destructive. Capitalism forms monopolies for the same reason that criminality generates gangs and organized criminals (mafia bosses). The law of oligarchy takes effect to consolidate power. This is also how dictators take over failed states, to fill the power vacuum.

Your faith in the logic of competition to regulate a "free" market strikes me as pretty ahistorical. The US is swimming in monopolies. Sure, the government has the power to end them. But government hardly created the monopolies in the first place. Government signs off on big mergers, but government does so because it shares big business's neoliberal ideology.

There's even a contradiction in this account of yours. On the one hand, you say "such monopolies can only be created and maintained through government fiat." On the other, you say, 'Soon, the regulated businesses have "captured" the regulators who then start passing regulations that prevent new competing companies from forming.'

Your second statement there is more accurate. The capitalist society tends to become plutocratic as the government removes itself from regulating the market or as it succumbs to the common neoliberal ideology. In that case, though, it's hardly just "government fiat" that makes for monopolies. No, it's the private sector's capture of the public one, or the creation of a revolving door between those sectors, to make for a shadow, plutocratic arrangement.