Smaller government yes, but environmental regulations are a must! It's been shown time and time again that when nobody is watching private firms like to dump waste as cheaply as possible without much care for consequences.
Environmental control is one of the few jobs that should really be government based.
It might not be government in the sense we understand now, but somewhere where people can make big united impact. The only counter balance to a ravaging capitalism is really the people and only through government can people from every corner of the country stand together. That is what a government should really be...by the people for the people. Now it's run by anyone who has enough money to bribe.
Only a government run entity has the means to counter the vast, different ecological problems. Even if we strip it of all other authorities, keeping this one is essential. A healthy environment will produce a healthy and rich society everything else will follow. I'd happily pay my taxes if this would be the case.