Let's look at this from the point of view of the people being cattle and the government being altruistic, malevolent, or orderly. In a malevolent government, the government cares little for the people, so has to spend more time and resources policing its people. The more the people, the more intrusion, the more difficulty in keeping the peace. Have too large a population and they'll either become unruly, being all serfs, or require immense resources to manage.
On the other hand, you've got a goody-two-shoes government that's interested in benefit for the people, altruism, and general public well-being. Who wouldn't want to live in a society where the lowest of people are treated fairly, opportunity is available to all peoples regardless of birth, and all that good, Utopian rot? Masses of people would love to be part of that sort of society implicitly.
As a result, of course, that would mean Good would have higher manageable populations, more economy, more influence, and a larger number of troops to defend their planets.
Hit the nail on the head.