Hi bb,
The logic was there for the extreme position that government is harmful. Avoidance of harm is equivalent to a benefit.
But if you take the cost-benefit analysis angle, then the obvious rejoinder is, we judge the way we set taxes and spend money via the democratic process. That kind of system is more complex than you allow.
For instance, taxes and costs are non-linear. Governments borrow and in my view it makes sense for them to do so - in some periods, they ought to do so to a greater extent. But if some folks decide a government should not borrow and they do not form a majority of the voting electorate and they force their policy on the majority, then I think the majority has a legitimate claim that the minority should bear the costs it imposes. I think everyone is aware that the Republicans failed to garner an electoral majority and their House advantage derives from gerrymandering. Instead of behaving with the humility their position demands, they have forced cuts upon everyone. I think the majority of the electorate has a claim against the minority. If the minority demands cuts, it should bear them.
As you know, these cuts are being made against a deficit. So there is no surplus tax to be recovered.
Indeed, the Democratic party thinks a stimulus, rather than cuts, would benefit the economy. Neo-Keynesian economists tell us cuts exacerbate the problems we face. So by cutting, Democratic voters believe they are having harms imposed upon them. By the minority. If Republicans are keen on cuts, let red states bear them. After all, overall transfers between states mean blue states subsidise red ones. Why should they continue to do so?
Also, because taxes and expenditures are non-linear, many costs accrue towards a common purpose. I'll use potholes as my example again. Roads are a benefit to everyone. Although the largest proportion of the benefit arising from their use accrues to local people, other folks pass through. So the people in the local state may prefer to keep taxes and let potholes aggregate. But as a person driving through your state, I also have an interest in your roads being properly paved. If you decide not to fix your potholes and you keep the pothole fixing costs for your own pocket, you are seizing a benefit that belongs to everyone.
I guess I am saying that there's more to an answer to your question than meets the eye.
But my simplified answer made the point. If people think government is wicked and intrusive, theoretically they should believe they will receive a net benefit by reducing the size of government while paying their taxes. Indeed, such folks - who love to appeal to future generations - could feel terribly pleased that they are making a sacrifice for the sake of them. Maybe it would help balance the budget! ;-)
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