So what is the right size?
Much smaller than our currently bloated Federal Government. Start there. Reform and simplify tax law and drastically cut the IRS. We have far too many overlapping security/spy agencies with their overhead and "need to justify their budgets" attitudes. Reduce, consolidate, eliminate some of them. Same with the "health" agencies. How much is really needed? How much of our current "oversight" is really just captured by big pharma, health insurers, etc?
We can adequately fund our military.
Necessary, but reduce expenditures on "tactical" vehicles and gear, emphasize training.
See above.
Necessary, but there is far too much emphasis on standardized testing and "free" college or government loan programs. An honest, pragmatic post-mortem of the the last few decades of policy and outcomes should reveal what needs to be eliminated or drastically reformed. Teaching children to think logically and to be skeptical is what will protect them from A) their own government and B) predatory corporations (advertising, etc,). Unfortunately we're more focused on immutable external characteristics, gender, and not hurting anyone's feelings instead of actual education.
Should none of these be centrally administered? Are you willing to acknowledge any benefits at all from these things being funded and administrated centrally?
It's all about trade-offs. When the policies/agencies cost more (in dollars and liberty) than the benefits they provide they need to go. There's nothing more permanent than a temporary government program, unfortunately.
To continue with our example in this thread, I'm quite sure I could scratch around and find an example of poorly imported or corrupted food regulation in Europe. But if you asked, on balance, whether food regulation has a net positive effect or net negative effect on my life, and the lives of 99.99% of citizens, I would undoubtedly say that it is net positive. If the alternative is to 'leave it to the markets to decide' what the safe levels of pesticides are in my food, or what conditions animals should be kept in before they're slaughtered, the quality of the food that's available to most people will undoubtedly suffer.
I agree that some level of regulation is needed. But when the regulatory agencies/government allow the removal of country of origin from food labels, removal of GMO labeling, and the selling of huge farm and agribusiness to overseas entities, there is something fundamentally broken (regulatory capture). And then the focus shifts to the Amish or other producers who have no budget for legal defense and no lobbying power. I hope you'd agree that this is fundamentally broken. Spending more money trying to patch it up isn't going to work, nor is leaving it alone.
And yes, a good part of it goes back to the Citizens United decision which is a big problem that needs to be addressed. Corporations are not people and do not have rights like people do.