1. The GDP is largely raised due to costs of services, tech innovation, & inflation. Note that the measurement of inflation has been revised several times over the past few decades. Why would we not expect the government to become more efficient due to tech innovation? Should they not get better & more cost efficient with the services they provide? Why is the expectation that the public budget must always grow to match GDP growth?
2. I don't think your numbers are correct. There's also bad accounting & no public source (possibly nobody) knows the true budget. For example, the Dept of Defense hasn't passed an audit. $11 Trillion went missing around the time of 9-11. There's also black budget projects that are top secret. Those projects are substantial & don't factor into the numbers. There's also rampant corruption with contracts. An example is the "Homeless Industrial Complex"...though that may be more of a select state + city government issue. Nonetheless, contracts are heavily padded for incumbent contractors in general across all sectors of the Federal Government.
3. IMO, the black budget projects along with the Dept of Defense should be the first to be audited & cut. The Health Care segments a close 2nd. USAID is a good cut, as it's been a vector for color revolutions & regime change. Looking forward to the IRS going away as well. Since it's founding justification was to support the war effort...And we have had never-ending wars (technically conflicts) since. And the Federal Government simply doesn't provide value to justify it's expenses.
4. I believe the argument is to attract companies. But I otherwise agree with you.
I'm skeptical over the changes that are occurring, but the size & scope of the Federal Government is clearly unsustainable & counter-productive to private commerce...particularly with small businesses. Considering how regulatory agencies are often revolving doors with industry incumbents with the incentive to stifle competition & promote incumbent interests.