States have become active participants in markets in the past decade, precipitating renewed scholarly interest in state capitalism. We contribute to the conceptualization of contemporary state capitalism by bridging it with scholarship on infrastructure-led development and analysing its political rationality. We highlight the origins of mid-20th century high modernism, which coupled spatial planning and social engineering for the purpose of transforming territory and 'improving' populations. Through a comparative historical, we demonstrate that a key characteristic of contemporary state capitalism is its tendency to decouple these objectives; while there is an emphasis on the transformation of territory, social engineering is virtually absent. Instead, individuals are meant to recognize economic opportunity afforded by infrastructure projects and self-actualize accordingly. Thus, the political rationality of contemporary state capitalism in Tanzania combines high-modernist spatial planning with orthodox neoliberal assumptions surrounding the inherent entrepreneurialism of individuals.