The jump from "eople will act in their best interest" to "government spending gets in the way of this action" is a leap of faith.
Its actually flawed. People will act in their best interest, and it is in a persons best interest to be safe. And in the US, Government is of the people, by the people,
for the people. So, if the Government is in charge, and is elected by the people, and the people want safety, than the US Government must give the people what they want. But if ALL Government Spending is unjustified, than that means that spending money on the Police Force, or the Military, is unjustified. But to not give the people what they want most, safety, is also wrong.
I think I can figure out which side would win in a practical setting. Your logic is good, it just needs to be refined.
Moving on to the OP, I think that lower taxes are good.
Lower taxes = More Money in your Pocket -> Spending the money in the economy -> Better economy.
Essentially, people will make the same value amount, regardless of what taxes are. And people like to hang on to their money; they won't spend it irrationally.
Lets say you make 1000 USD a year. You spend 700 on that on nessities, utilities, bills, mortgage, etc. Then, the government comes for taxes.
You have 300 USD left. IF the Gov takes too much, say 200 dollars, than you're going to want to save the remaining 100, incase of rainy days. But, if the government takes only 125, and you still save that 100, than you've got 75 USD for anything.
And what ever you spend it on goes into the economy, and if this happens enough, the economy goes up. The economy would get better because a business would make more money, because people are spending more in it. More money could lead to several things. Expansion, hiring, etc. If the business expands, it would hire more to fill up the new store, meaning that more people are being payed.
More people getting payed, is more people getting money, is more people to be taxed, and the cycle repeats.
What you lose in lower taxes, you make up for when the quantaty increases. However, the danger of lowering taxes is that if you lower them TOO much, than the government can't sustain itself.