STEADY REDUCTION: Spending by federal, state and local governments has been shrinking steadily since the 2007-2009 recession. But Republicans and other fiscal conservatives are insisting on even more federal austerity and a smaller government.

OBSCURED BY 'ENTITLEMENTS': The shrinkage has largely been obscured by an increase in spending on benefit payments to individuals under "entitlement" programs. Republicans argue that these programs should be on the cutting board as well as other government programs.

CUTS COMING: Unless a deal can be made, another round of huge cuts will hit beginning March 1, potentially meaning layoffs for hundreds of thousands of federal workers.