Bryan comments here and here about Tyler's theory that Europe has better government than the U.S., and thus can afford a larger welfare state.
Bryan says that Tyler is using a straw man by suggesting that market-oriented economists see Europe on the verge of collapse. I might be willing to step into the straw-man role, depending on how you define "on the verge." I think that collapse is a long way off, but I think it is a real possibility.
There is a subconscious belief in France that the state does not pay Paul by taking the money from Peter. It just gives it to Paul, and Peter is not made worse off. This is so because the money sits in an imaginary reservoir and the state can "unblock" it (debloquer is the French word used to describe this happy event). . .
Polls say that endlessly recurring rail strikes are approved by the majority of commuters who suffer great inconvenience from them. When tobacconists claim, and get, compensation for falling cigarette sales, everyone thinks that this is the least the state can do, and when imports make food too cheap, it is thought only fair to French farmers for the state to make it dear again.
I agree with Bryan that where voters are stupid, there is no guarantee that they won't get the policies that they deserve. I guess I am more willing than Bryan to take the next step and suggest that these policies may eventually be bad enough to cause collapse.
I disagree with Tyler's premise that we have more government failure than Europe. If we had Europe's military, the Taliban would still be ruling Afghanistan.