These Special Interest driven, Libertarian theories, are more Darwinian in nature and predatory in execution--a "survival of the fittest" mentality that preys on the weakest and most vulnerable. They exalt in their hubris and greed and protect themselves and their special interests by persuading congress with large campaign contributions, into privatizing and deregulating our government. The net result was banks could prey on the people with predatory lending, exorbitant interest rates and service fees as examples--forcing this nation into near bankruptcy. And then unabashedly, they're bought and paid for congress, stood firmly as a block against the Democratic efforts to re-establish financial reform regulations. They are the worst fear of the founding fathers coming true.
The founders saw the establishment of government as a matter of practicality--its establishment sprang from the belief that "virtuous" people could and should govern themselves and the bedrock foundation of government, should be based on absolute moral and civic virtue. In other words the absolute necessity to do what is morally right for "promoting the general welfare." They were driven by the ideal that the government should be a neutral arbiter of what was just and morally right. Impartial to a fault.
However the founders were torn by the reality of the human nature at its absolute worst--and whether the ideal they envisioned--a government of the (virtuous) people, by the (virtuous) people, and for the (virtuous) people--was achievable.
Their careful inclusion of the intricate system of checks and balances, which we now take for granted was their best effort to ensure that those ideals would survive the onslaught of a minority or majority of corrupt, self serving men. That fear and apprehension was best expressed in The Federalist #10 by James Madison, writing under the pseudonym of Publius--he expressed his fear that "the greatest danger to a democratic republican form of government was the tyranny of a minority or of a majority faction." In today's terminology a faction would be a special interest group, who either as a majority or a minority would put their own interest above what is just and right for either another group of citizens or even the greater good of the nation.
What Madison said about the size of Government.
Madison recognized that a small democracy cannot avoid the dangers of majority faction because, "small size means that undesirable passions can very easily spread to a majority of the people, which can then enact its will through the democratic government without difficulty. He then makes an argument in favor of a large republic against a small republic for the choice of "fit characters" (representatives) to represent the public's voice. In a large republic where the number of voters and candidates is greater, the probability to elect competent representatives is broader. The voters have a wider option. In a small republic it would also be easier for the candidates to fool the voters, while in a large one, harder."
Madison goes on in favor of a large republic, and explains that, "in a small republic there will be a lower variety of interests and parties, so more frequently a majority will be found. The number of participants of that majority, will be lower, and considering they live in a more limited territory, it would be easier for them to agree and work together for the accomplishment of their ideas. While in a large republic the variety of interests will be greater so to make it harder to find a majority. Even if there is a majority it would be harder for them to work together because of the large number of people and the fact they are spread out in a wider territory."
The fact that Madison's view was adopted as the majority view--that a large powerful robust government is the best protection against the corrupt self serving nature of man--is evident in the Constitution, as it was written, and flies in the face of the Republican lie, that our government is "too large."