However, as it turned out, a number of positive developments pushed the budget into surplus in 1998 through 2001. Importantly, bipartisan support in the Congress for establishing and maintaining some measure of budget discipline was demonstrated by adherence to the guidelines set by the PAYGO rule and the discretionary spending caps.
In the 1990s, the discretionary spending caps appeared to be effective in limiting the rise in annual spending appropriations. Defense spending declined by more than 2 percent of GDP, as the federal budget was able to claim a "peace dividend" after the breakup of the Soviet Union. Furthermore, nondefense discretionary spending was held about constant as a share of GDP.