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HappySqurriel said:
Growth in size, power, and expenditure of the government tends to be driven by good intentions; and (as the saying goes) "The path to hell is paved with good intentions" ... The reason for this is unintended consequences of action on a governmental level tend to create results that are greater in scale and run in opposition to the intended results.

The primary example of this is welfare. Prior to the war on poverty beginning in the 1960s, the poverty rate was steadily falling and the distribution of income became more equitable. With the introduction of welfare the government began subsidizing bad behaviour on a wide scale, and further complicated this by building housing projects to concentrate the consequences. The net result is a generation of children with poor parents and no role models who grew up in an environment with low expectations; and these children grew up to the be the drug addicted neglectful and abusive parents of the gang-bangers and junkies that have infested the crime filled hell that the housing projects became in the 1980s/1990s and still remain today.

In an ideal world where the government is managed like a charity, venture capitalist and bank with no politics or corruption a lot of good could come from government spending; in the real world government intervention to solve any problem typically makes it worse.

Correlation is not causality.   One can't just say that because there was government doing welfare that meant that suddenly families broke down.  Families broke down in middle and upper class to.  The sexual revolution happened in the 1960s also.  Catholic Church would argue that birth control was a major factor also, saying they predicted this would happen.  One could then also argue that the drug war drove people to do more drugs, and argue the prohibition side also.  And on this, some would argue you are wrong on the causality side, and also outcome:

http://en.wikipedia.org/wiki/Welfare%27s_effect_on_poverty#Table_of_poverty_levels_pre_and_post_welfare

http://www.governmentisgood.com/articles.php?aid=22&p=2

This being said, government is working for someone, even if it were special interests.  Someone is getting rewarded for it, or there would be an attempt to grow it.  Someone gets the extra money reallocated.  Someone happens to get benefits from restricting things.  There is a payout, with desires outcomes, so it continues.