I don't have any empirical studies to back up my point, either, but the way spending is allocated by the US government is anything but rational. I have severe doubts that adding $1 more of revenue into the system will produce greater than $1 of benefits.

There is something to be said for the design choice of federalism; pushing all possible decisions down to the smallest unit of population effected. However, our government has moved away from this since the Roosevelts time in power.