Foucault is not saying that in the mid-eighteenth century, capital came to dominate government or that the state became an apparatus of capital. Rather, his point is that the market (tellingly, he never says “capitalism” here) become a new limit on the state even as it began to saturate and construe the state with its distinctive form of reason and that this limit and this form of reason are at the heart of what we call “liberalism.”

Wendy Brown, Undoing the Demos, loc. 99