You cut the budget. Some companies go under, increasing unemployment. Unemployed people not produce and do not pay tax, but they continue to consume and receive

You cut the budget. Some companies go under, increasing unemployment. Unemployed people not produce and do not pay tax, but they continue to consume and receive government services (traffic lights, toilets, parks, police, firemen, etc). To further balance the reduction in tax revenue from the increase in unemployment, you cut the budget some more. Some more companies go under, further increasing unemployment, decrease tax revenue, leading to further budget cuts etc.