A little of both I'd say, but what you consider special interests other people consider interests. In a democracy there's always going to be disagreement about what's necessary and all good compromises leave everyone feeling a little unhappy.

Well, I will agree with you there--government generally leaves people feeling unhappy, which I why I prefer decentralizing it, letting people move out of the jurisdiction of a government that makes them miserable. That's the beauty of federalism and our Constitution. :)

I'd say it takes a good part of that. Some is direct: military, police, court, and prison spending accounts for a huge proportion of total government budgets, more than half. And some is indirect: there is only some level of inequality people will tolerate before there's rioting and seizure of property, so things like social safety nets indirectly serve to guarantee property rights by mollifying discontent.

That's a point a lot of people miss; redistribution of wealth to maintain acceptable levels of inequality are what maintain the peace. It doesn't matter if redistribution of wealth is right or wrong, only that it's a practical necessity to maintain a stable society.