The 104th Congress, elected in 1994, was the first on record to reduce real spending in all three major discretionary spending categories -- defense, international and domestic -- says a report from Congress's Joint Economic Committee.

Discretionary spending programs are funded by congressional appropriations bills, in contrast to entitlement spending such as for Social Security and Medicare, which occurs automatically.

Due to lower defense outlays since the end of the Cold War, overall discretionary spending has been declining since 1991. But the three Congresses prior to the 104th increased domestic discretionary spending by $100 billion; whereas the 104th Congress didn't just cut defense.

• Combined discretionary spending fell more than $72 billion in the 104th Congress in inflation-adjusted 1998 dollars (see figure).

• This included domestic discretionary spending cuts of $9.3 billion in 1996 -- the largest single-year reduction in domestic outlays since 1982.

• Even with the increases in 1997 and 1998, appropriations for domestic discretionary spending for 1998 are still $3.3 billion below the 1995 level.

The report concludes that recent congressional budget policy has successfully halted, at least for the time being, the long-term upward trend in discretionary spending. Also, it suggests restraint on all types of federal spending, including entitlements, will be needed to ensure that budget surpluses materialize as projected.

Source: Dan Miller, "Trends in Congressional Appropriations: Fiscal Restraint in the 1990s," April 1998, Joint Economic Committee, G-01 Dirksen Building, Washington, D.C. 20510, (202) 224-5171.