Well, ignoring your journey to reductio-ad-absurdum-land...
...I will answer your direct question: it is impossible to say what big enough will ever be. Things change. Society becomes more complex. As complexity changes, our institutions must change and expand to encompass the newest realities.
Bottom line: government will increase proportionally to the increase in complexity of life. I don't see any end in sight. If you have a solution, I would love to hear it.