I periodically share data on the age-dependency ratio in various nations.

That’s very important data. It helps to explain why young-to-old redistribution programs in many nations are becoming a recipe for fiscal crisis.

But to fully understand the level of dependency in a country, you have to know the share of people who actually produce value compared to those who live off of government.

In other words, you need to know more than the number of older people using Social Security and Medicare (or the equivalent programs in other nations). You also need to know how many working-age people are on welfare and how many of them are employed as government bureaucrats.

I shared some estimates of “implied public reliance” back in 2015.

For today’s column, here’s a chart for four major European nations. In every case, the number of people riding in the wagon is greater than the number of people (the orange bars) pulling the wagon.

The ratio in France is especially bad, which may explain why there’s a strong case that it will be the first domino when the next fiscal crisis occurs (as it almost certainly will).

The fiscal and economic implications of the above chart are very straightforward. Simply stated, government is far too big in these nations and too many people are living off their fellow citizens.

Fixing that problem isn’t complicated. Governments need Swiss-style spending caps so that politicians are forced to reform entitlement programs.

But smart solutions are not easy solutions. The obvious roadblock to economic rationality is that the number one goal of politicians is to retain power. And if the number of voters living off the government is greater than the number of voters paying for government, it’s very likely politicians will fight to preserve the status quo.

Even if they privately understand it is a recipe for crisis and national decline.

Indeed, this depressing observation is why I put together my 17th Theorem of Government.

Everything I’ve written so far is pessimistic, so I’ll close by explaining why there’s still hope. Not just for the four nations shown in the visual, but also for the United States and every other country plagued by excessive government.

First, a non-trivial share of the people living off the government are not ideological leftists. Retirees are obvious examples. They get retirement benefits from government, but many of them would have preferred to have personal retirement accounts. And many government bureaucrats also lean to the right. Heck, maybe even some welfare recipients.

By contrast, it’s also true that a good chunk of private workers lean left. The bottom line is that statist politicians will have the advantage in a country with lots of government dependency, but there are exceptions.

Second, one of those exceptions is Greece, where a fiscally responsible government has been in charge since 2019 and getting good results.

Another example is Argentina, which had a terrible dependency ratio, yet elected a radical libertarian in 2023.

The bottom line is that even left-leaning populations can (sort of) sober up once they run out of other people’s money. As I said to a TV audience back in 2009, parasites should understand they need a healthy host.