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Yeah, and the majority of that time we instead survived on slavery, child labor, other abusive labor practices, lack of unions, and probably much, much more.
Untapped stocks of natural resources supplies greatly outweighing their demand, and disconcern for environmental impact during this period had something to do with that as well, I'm sure.
None of this has anything to do with the federal government. The shouldn't need a lot of money to function because they're not supposed to be really doing all that much. They hand billions to the states in exchange for the states meeting their (often arbitrary) demands. Why add this layer of complexity to it? Why not drop the federal income tax and just give that money to the state instead? Constitutionally they're the ones responsible for providing services.