"”The truth of the matter is that my policies are so mainstream that if I had set the same policies that I had back in the 1980s, I would be considered a moderate Republican,” - Barack Obama [0]
This is not a statement of Republicans and Democrats being the same, but a statement of Republicans going off the deep end in during and after Reagan.
Obama was a very moderate Democrat for his time. If you go back in time a moderate Democrat and Republican were similar because the "center" was more reasonable. Now the "center" is just people that are ashamed that they vote Republican.
If we accept that, then "government" and "Republicans" would be pretty much synonymous, so my original point stands. (Not that I accept it, but even if I did.)
I think your original point stands; I was not intending to contradict it, only to offer a possible explanation. The Overton window of what is seen as possible and necessary in US policy has shifted from, say, Social Security and Medicare, to tax cuts. IMO, party labels do more to obscure than reveal in these days, whatever the awfulnesses and benefits of either party may be.