The situation we're in right now is caused by the financial crisis, bailout, recession, and loss of tax receipts. It's not because the public have been spoiled silly with lavish public spending, or by buying themselves yachts and trips to Monaco.
What a load of bollocks. The financial crisis was caused by....wait for it....overspending. The bailout had to happen because of poor lending practices, encouraged to facilitate growth (ha!) through....overspending.
The recession is a result of....overspending.
This isn't an individual problem but a collective issue. It's the state's responsibility to do everything these days and you are acknowledging that by identifying them as the villain of the piece.
People chose to get credit. FWIW I didn't. I was raised to save up for stuff. Perhaps that's why I am solvent?
And as for the 'leeches' at the top - I guess that'd be me then. We pay 65% tax. Which makes it tempting to fuck off to Malta really. Yes we are really getting away with murder 
There is no way to do this without cutting services. Really there isn't. Unless you propose that all public servants don't get paid for about oooh twenty years.