King's Justice

Indeed he does, which I think answers his riddle:

ACOK Tyrion I
"In a room sit three great men, a king, a priest, and a rich man with his gold. Between them stands a sellsword, a little man of common birth and no great mind. Each of the great ones bids him slay the other two. 'Do it,' says the king, 'for I am your lawful ruler.' 'Do it,' says the priest, 'for I command you in the names of the gods.' 'Do it,' says the rich man, 'and all this gold shall be yours.' So tell me—who lives and who dies?"

ACOK Tyrion II
“Oh, I think not,” Varys said, swirling the wine in his cup. “Power is a curious thing, my lord. Perchance you have considered the riddle I posed you that day in the inn?”
“It has crossed my mind a time or two,” Tyrion admitted. “The king, the priest, the rich man—who lives and who dies? Who will the swordsman obey? It’s a riddle without an answer, or rather, too many answers. All depends on the man with the sword.”
“And yet he is no one,” Varys said. “He has neither crown nor gold nor favor of the gods, only a piece of pointed steel.”
“That piece of steel is the power of life and death.”
“Just so… yet if it is the swordsmen who rule us in truth, who do we pretend our kings hold the power? Why should a strong man with a sword ever obey a child king like Joffrey, or a wine-sodden oaf like his father?”
“Because these child kings and drunken oafs can call other strong men, with other swords.”
“Then these other swordsmen have the true power. Or do they?” Varys smiled. “Some say knowledge is power. Some tell us that all power comes from the gods. Others say it derives from law. Yet that day on the steps of Baelor’s Sept, our godly High Septon and the lawful Queen Regent and your ever-so-knowledgeable servant were as powerless as any cobbler or cooper in the crowd. Who truly killed Eddard Stark, do you think? Joffrey, who gave the command? Ser Ilyn Payne, who swung the sword? Or… another?”
Tyrion cocked his head sideways. “Did you mean to answer your damned riddle, or only to make my head ache worse?”
Varys smiled. “Here, then. Power resides where men believe it resides. No more and no less.”
“So power is a mummer’s trick?”
“A shadow on the wall,” Varys murmured, “yet shadows can kill. And ofttimes a very small man can cast a very large shadow.”