Eric Kain does a pretty good job summarizing the point I was trying to make earlier.
The state works first and foremost for the elite, after all. It creates a system of violence (the War on Drugs) which leaves too many people under the thumb of black markets, imprisons too many nonviolent offenders and regurgitates them back into society with criminal records and worse job prospects, though this violence rarely touches the upper classes. Then it provides inadequate and too-often opaque policing for the neighborhoods hardest hit by drug violence.
It manufactures a regulatory system which too often bars small competitors from entering markets, making more and more people dependent on a combination of state benefits and corporate wages. It subsidizes and protects large market players at the expense of possible competitors, and in recent years it has helped bail out the financial sector while doing very little to help the most destitute, or those harmed by the financial sector’s collapse in 2008.
And finally, to top it all off, now that it has helped to undermine self-empowerment, entrepreneurship, and has handicapped the poor through mass incarceration and the substitution of civil society with faux law and order, not to mention the myriad ways poverty is de-facto criminalized in our society, the state provides a number of subpar services whose recipients believe can only be provided by the government. Crutches and shackles, bread and circuses.
To sum it up: You can not tear down or reduce the welfare state without also tearing down or shrinking the institutions that promote the need for the welfare state. As much as Republicans want to gut SS & Medicare & the like, they are not eager to shrink the police state or level the business playing field. Of course, neither are Democrats (they seem to like SS & Medicare AND the police state and market barriers).
PS – I do think he paints the US picture a little too rosy relative to the UK, since our society suffers from almost everything he lists above in varying degrees, so I don’t think we are too far behind the curve.