The key element here is that the power exchange in this case goes both ways. The corporations do favors for the administration (sometimes outright corrupt payments and sometimes useful favors, like promoting certain kinds of content in the media, or firing employees who speak up.) And in exchange the companies get regulatory favors. While all economic distortions can be problematic — national champion companies probably have tradeoffs - this is a form of distortion that hurts citizens both by distorting the market, and also by distorting the democratic environment by which citizens might correct the problems.