By john 
States write law. Private capital writes incentives.
Private capital is no longer just capital. Private capital has become a political actor class. PE funds can hollow out sectors through cash extraction Pokemon787 optimization. Hedge funds can manipulate sovereign negotiation outcomes through holdout tactics. VC ecosystems can determine which industries exist in the future and which industries die before they reach scale.
This is not market. This is political engineering through capital design.
BlackRock, Blackstone, Carlyle, KKR, Apollo, Bridgewater, Tiger, Sequoia — these entities have more geopolitical influence than many mid-size economies. Their lobbying networks shape what governments define as “national interest.” Their exit horizon expectations shape productivity metrics. Their capital flight threat disciplines policymakers faster than elections.
This is a world where elected power is no longer monopoly power.
Great powers also now court private capital as geopolitical instruments. Washington uses private capital talent and capital density as leverage in tech dominance. Gulf sovereign funds use private capital partnerships to reposition themselves as indispensable global liquidity stabilizers. China uses state capital to create private-market like strategic discipline.
The boundary between sovereign power and private capital power is dissolving. Instead of nation-state vs corporation — we are entering nation-state + capital bloc alliance politics. Every major conflict now has a capital alignment layer invisible to the general public.
This raises a legitimacy time bomb: what happens when most citizens realize that democracy still votes — but capital still decides? The political economy crisis ahead is not revolution. The real crisis is systemic resignation — when voters no longer believe elections matter because capital architecture stays constant regardless of ruling party.
The new power class is not elected. The new power class is allocated.