America used to have lower taxes across the board for all of these things - look at the 1920s-1950s. You know what else was true in those times? Absolute rates of poverty way higher than today, death rates higher, life expectancy significantly lower, no environmental regulation (smoking everywhere, pollution etc), workplace accidents, no interstate highways, higher crime levels, the list goes on and on. Is there some percentage of tax money that is misappropriated/misused? Sure; but I think the percentage is [relatively] small - 10-20% at most.

Disintermediating the health care system with a public option could lead to the biggest savings in the system overall. The military budget stuff is somewhat disingenuous because it was necessary for the U.S. to maintain a capable military first because of the Soviet threat and later to back the USD as the global reserve currency and secure foreign oil - unless we could get the domestic shale up and running (USD as the reserve currency improves the purchasing power of every American and allows us to live "beyond our means" on an international level - while on the downside making our exports uncompetitive). But nevertheless, if our military went away, Americans would have to take a haircut to their standard of living.

So it's not as simple as you make it sound.