Bill Clinton may have declared in 1995 that the era of Big Government was over, but Congress didn't take the hint. Over the next six years, lawmakers increased spending on domestic discretionary programs―from roads to police to schools―by 28%, or nearly twice the rate of inflation. That spending spree is about to come to a screeching halt. The federal deficit, now at $159 billion, could top $200 billion in the fiscal year that began Oct. 1. So to free up money in a $2 trillion budget for its top priorities―a military buildup, homeland security, and tax cuts ―the Bush Administration and the new Republican majority on Capitol Hill are mapping out an aggressive strategy to squeeze domestic programs. "This year, the President was the only stopper against excess spending," says White House budget director Mitch Daniels. "Now, he has more allies." The result will be something that was unnecessary during the boom years of the late '90s: spending freezes or cuts for some programs, such as winter heating subsidies for low-income Americans, and smaller increases than promised for others, such as education.
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