Overpopulation :(

Yep, definitely the tax cut spiral. One keeps lowering taxes to keep people happy and all they do is breed. Now you don't have enough money to pay for the social projects and military force required to protect them. The solution? Know where to draw your line. If you decide that 25% taxes is as low as you go and some planet starts dipping low, use a little propoganda or a single +morale project to get the folks there back into the stable zone if they cannot correct themselves by thinning out the herd on their own. If you are being culture bombed and the low morale is causing a danger to loyalty, make a culture starbase in your own sector. My usual tax rates run into the 40% range, but in my current game I was running 60 for a long while until I cut down a bit. Point is that I do not want these citizens of mine to love me, just to pay me. I won't tax them hard enough so that they defect, but I am sure going to make them work.

I am only playing version 1.2, so the stable line where folks stop breeding is about 54-55% morale for me and I am a bit out of the loop on all this 1.3x stuff. So any new morale cutoffs or situations specific to the later version should be addressed by other folks.

Doing the colony or transport ship thing to keep morale up is a sign you're doing something wrong. Selectively build morale boosting structures as needed and you can have positively huge populations at morale 100 for the majority of the game.

Tax cuts, as noted, are very ineffective. Since population actually represents the number of registered citizens paying taxes and happy enough with your current social infrastructure, all cutting taxes does is induce a bunch of the former tax dodgers to sign up and soon enough there's too much drain on your social system again.

As the manual says, its hard for any leader to keep an aproval rating above 60%, so just let morale go down to its 54% level (that's in 1.3 as well). You should only worry if morale suddenly drops below 40, which means someone's destabilizing you. At that point, there's a good chance the planet will join the I-League.

I had well over 2 trillion people in my latest game, many on planets with 100% morale, at a tax rate of 45% (pretty consistent at 45% throughout the game). And I wasn't trying to get a huge population or anything, that's just how it panned out.
If you "have" to lower your tax rate, you need to look into whether you're building enough Social buildings that increase morale. You could also look into adding modules to a starbase that's on a morale resource. If you don't *have* a morale resource, GET ONE!
They usually cost you a fair bit if you try to buy/trade for the starbase from an AI, but if you're the militaristic sort, trundle a heavy hitting ship over with a constructor, kill the existing starbase and pop your own constructor onto it in the same turn.

~SDC~

Put them to work conquering the rest of the galaxy for you.