Here are three related things:

1. The government is not implementing the Dilnot report, even though uncertainty about the likelihood and cost of needing care in old age makes it impossible for people to plan their finances sensibly.

2. There's widespread hostility to welfare benefits. A TUC survey (pdf) found that 42% of people think them too high, whilst only 18% think them too low. This suggests there's little demand for insurance against unemployment risk, despite the fact that this risk is high, even in decent economic times.

3. Although a plurality of voters (pdf) thinks fiscal austerity is bad for the economy, only 42% think the spending cuts are too deep and a majority think they are necessary. This suggests the public's appetite for counter-cyclical fiscal policy is smaller than that of many (most?) mainstream macroeconomists.

There's a common theme here. All point to government and/or voters having little desire that the state help provide insurance against big risks that the private sector does not insure us against. This is despite the fact that the correction of market failure is a legitimate function of government - though of course left and right differ on the extent of such failure.

Why is there so little demand? There are three possibilities:

1. People are risk-tolerant, so that - as Robert Lucas suggested (pdf) - the welfare costs of aggregate fluctuations are trivial.In the trade-off between risk and incentives, people prefer a position nearer the latter.

I'm not sure about this. Low stock market participation, and demand for poor-value insurance products such as PPI, extended warranties and (I suspect) pet insurance suggests people are risk-averse in some domains.

2.The government (not just in the UK) doesn't understand that the role of the state is to solve problems of collective action, to do what the private sector cannot do. Politicians prefer to patronize the (poor) obese and waffle about vision and destiny than take genuinely hard choices to improve people's security and well-being.

3. Popular thinking about risk is horribly contaminated by cognitive biases. Wishful thinking stops us appreciating the danger of redundancy or dementia, sheer ignorance causes folk to over-estimate the generosity of welfare benefits, and that damned "good housekeeping" metaphor stops them thinking seriously about macroeconomic policy.

Unless reason (1) is the sole factor - which is improbable - the point here is depressing. There are powerful obstacles to the state being used for what it should be for - a means of pooling risks in the face of market failure. Which, in an odd sense, vindicates the anti-statist position that for every market failure, there's also a government failure.