1. Additional federal spending transfers resources from the more productive private sector to the less productive public sector of the economy. The bulk of federal spending goes toward subsidies and benefit payments, which generally do not enhance economic productivity. With lower productivity, average American incomes will fall.
Chris Edwards has 5 more reasons to downsize the federal government @ http://www.cato-at-liberty.org/2010/03/03/six-reasons-to-downsize-the-federal-government/
The Cato Institute has dedicated a new website to Downsizing the Federal Government: http://www.downsizinggovernment.org/