This report analyzes the effect of President George W. Bush's administration's budget proposal on federal discretionary grant-in-aid programs provided to state and local governments. These programs are projected to be cut by 6.9 percent in fiscal year (FY) 2002 and, by 2011, by 11.2 percent. The report provides data on proposed changes in spending of federal aid to state and local governments relative to a baseline for FY2001 and FY2011. It covers 192 programs in the category of discretionary spending with a total cost of $122 billion in FY2001. This spending represents about 87 percent of total discretionary federal spending that takes the form of aid to state and local governments (including grants to Puerto Rico, the District of Columbia, the Virgin Islands, and U.S. Territories), and about 38 percent of all federal non-defense discretionary spending and 10 percent of total spending by state and local governments. Baseline spending in 2002 and 2011 is compared to projected Bush budget spending for those years. Table 1 presents the results for the nation as a whole, while Table 2 presents the extent of cuts and increases on a state-by-state basis. Tables feature statistics on education, training, employment, and social services. (KC)