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.