By that logic; I hardly think that government intervention in the 1800’s was so pervasive that poverty affected 80%. That’s what you are claiming. I can accept the figures, but to hold government responsible is ridiculous.
No, the assertion was that without government welfare programs a society would be too "unstable" to develop. I'm showing that even with such a vast proportion of people afflicted by poverty and no welfare programs that the industrial revolution and the lack of governmental interventionism and taxation allowed for a great deal of economic growth and employment to occur.
Today, governmental intervention, supposedly enacted in the interests of the poverty-stricken, is destabilizing to the market process and hampers growth.