The government is forced to borrow money if the tax revenues do not cover their expenses. Thus, if they decrease taxes without decreasing spending, the government might need to borrow money to pay their bills. The government typically borrows money by issuing Treasury bonds or bills. Likewise, they pay down debt by calling existing bonds or paying them off at maturity. This is a separate activity from the Fed that is buying or selling US treasuries in the secondary market.
Posted by Boston Institute of Finance
Bryant University Financial Planning Education Blog 