My heart will go on, but not government spending. Or, will it?

The Economist has a special feature on the "state" and explores a set of questions that is not unfamiliar territory in this blog.  The following chart, borrowed from there, immediately gives a sense of how much governments all across the planet have grown.

The reason I have "or, will it?" in the title:

A lot of economic theorists have predicted an ever larger state since Adolph Wagner linked its growth to industrialisation in the 19th century. The Baumol cost effect is often cited. In the 1960s William Baumol and William Bowen used the example of classical music to show that some activities are not susceptible to improvements in labour productivity. You still need the same number of musicians to play a Beethoven symphony as you did in the 19th century, even though real wages for musicians have risen since then. Larry Summers, Mr Obama’s main economic adviser till the end of 2010, argues that the goods governments buy, especially health care and education, have proved much more resistant to productivity enhancements than the rest of the economy. Since the 1970s real wages in America have risen tenfold if you measure them against the cost of televisions; set against the cost of health care, they have gone down.

It is too darn difficult to resist the temptation to characterize the state as the Titanic heading towards the twin icebergs of  health care and education--it does not look like how we can successfully negotiate these two without major damages.