I’m not a fan of the Organization for Economic Cooperation and Development (OECD).

The Paris-based bureaucracy is dominated by Europe’s left-leaning welfare states, so it unsurprisingly has a statist policy agenda (especially on fiscal issues, as seen here, here, here, here, and here).

But the OECD is nonetheless a good source of data and the economists who work in Paris occasionally publish some interesting research. For instance, there’s a new study by Sebastian Barnes, Boris Cournède, and Fred Hanmer entitled Assessing government spending in OECD countries and searching for savings.

The report is noteworthy because it acknowledges that excessive spending is a problem for OECD nations.

What I found most interesting, however, were the charts showing which nations had above-average spending in different categories.

For instance, Figure 13 shows that Finland, France, and Denmark have very high spending levels for “old age” (what Americans would list as Social Security) and “social protection” (welfare payments).

The United States also has some above-average spending for “defense” and “public order and safety.”

If you look at the footnote, you will see that Switzerland gets a special mention because it has no above-average spending in any category (another sign that it is the world’s best-governed nation).

Next, Figure 14 slices the data differently, adding “aggregate spending” as one of the variables (the U.S. is excluded because our numbers apparently are calculated differently).

You’ll notice considerable overlap, with Finland, Denmark, France, Austria, and Hungary being profligate in both charts.

Last but not least, Figure 18 shows how the burden of government spending could be reduced if nations merely reduced various budgetary categories to the OECD average.

I’ll close with two observations.

• First, average spending in the OECD (the benchmark used for the above graphs) is far too high is almost every category. As such, the “potential savings” should be viewed as merely a start.
• Second, not all spending categories are equally problematic. Some spending, such as “defense” and “public order and safety,” is for genuine public goods. Other types of spending, such as “old age” and “social protection,” are unambiguously counterproductive.

P.S. In a 2019 column, I compared OECD nations based on total outlays for various types of social welfare spending.

P.P.S. In a 2016 column, I cited an earlier OECD study that showed the significant economic benefits some nations could enjoy if they reduced their spending burdens to the OECD average.