Game lost by the Private Sector

[CyclopsSlayer]

Not exactly sure what all happened and when, but...

Started as a Normal Empire in the age of Shadows. Set the Pirates to 'Distant' but they were in my home system almost before I started the first Space Port. Bought them off until it was done. grrrr...

Later, I had 10 Colonies going, was holding my own economically. Had 2 big Resort bases funneling cash home. The Homeworld was cranking out money with a Bazaar, 3x Research Wonders. 3 of the colonies had medium SPorts in place, I tried setting up smalls elsewhere but the Pirates kept eating them before they were built.

Then I met a new breed of Pirate... This Mutant had >15 Colonies under their control, 136 Warships some of which were HUGE. He was Raiding my colonies with up to 200-300K in Troop strength, wiped the 3 Medium SPorts and all my Fleets away like they were nothing. I spent most of the next game Decade fighting him off as world after world started sprouting Hidden Bases, and replanting them as fast as I cleared them. I had set up all my civilian ships with Hab Modules for 300 Boarding strength, but the messages of Freighter XXX was captured, Freighter YYY was destroyed were flying faster than I could track.

Finally drove him off my worlds after about a game decade, but started getting massive Resource shortage messages, all my construction stalled. Went and looked on the Empire screen and the State had 600k on hand and +40K Cash flow. The Private Sector however... -3800K in the hole, but had a +350K cash flow.

Then I went to look at the ships, and saw to my horror that the Private Sector didn't have even a single Freighter to its name. It only had a 25K ships and base maintenance on a 500K income. And with no cash on hand couldn't build any, at the rate I was digging it out of the hole it would have been 20+ game years...
Not a clue what made the Private go soo negative. But now the only source of construction materials was Smugglers and that doesn't work at all well.

If I could have built the Freighters for them I would have and kept the economy rolling. As it was, all the money in the world to order ships, and nothing at all to build them with.

[Aeson]

If I could have built the Freighters for them I would have and kept the economy rolling.

I believe one of the captured ship settings in Empire Policy allows you to add captured civilian ships to your merchant navy. So, maybe try going Pirate Empire yourself for a little while? I don't think other Empires will care if you steal independent ships, and you could legitimately raid the trade lanes of Empires with whom you are at war.

Also, you could potentially help the private sector out by reducing colony taxes, as that should give them more cashflow to play with.

Probably what made the private sector go so negative is all of the replacement ships it was trying to build during your pirate war, which would have sucked up its cash and probably driven the cost of materials up.