My former student Stephen Slivinski, now director of budget studies at Cato, has just published his first book, Buck Wild: How Republicans Broke the Bank and Became the Party of Big Government. There's lots of neat stuff in this book, but the best is his chapter on the libertarian benefits of divided government.
Slivinski tabulates that under the average united government - i.e., one-party control of the presidency, House, and Senate - the growth of real per-capita government spending is 3.4%. Under divided government, this growth rate is only 1.5% - less than half as fast.
That's a big difference. In contrast, united Democratic government and united Republican government look virtually the same: 3.3% government growth under Democrats vs. 3.6% under Republicans.
The most libertarian configuration of all turns out to be Democratic president + Republican Congress. Average rate of government growth: .4%. (And Steve doesn't even mention the other plausible libertarian benefit of this combination - less interventionist foreign policy).
I'm tempted to say "God, I miss Clinton." But that gives too much credit to Clinton personally. I don't think that Clinton wanted smaller government. But the unintended consequence of his endless quarrel with the Republican Congress was precisely that.
P.S. For some weaker state-level findings of the libertarian benefits of divided government, see my piece "Has Leviathan Been Bound?" in the 2001 Southern Economic Journal.
