If the economy needs dampening, the government cuts back without regard to revenues, i.e. like the surplus we're currently running. If you want to use fiscal policy as a management tool, you can't run government like a business. But, it is exceedingly difficult to craft a delicate, soft landing using fiscal policy. Government spending, which is a political decision, is hard to turn on, harder to turn off. Both Bush and Gore proposed tax cuts during 2000's famous overtime campaign.
Monetary policy is the manipulation of any of a number of monetary variables.
The modern approach to monetary policy focuses on two key interest rates. The first is the Fed Funds rate, essentially the interest banks charge each other for overnight loans. The cheaper it is for the banking system to cover loans made, the more willing the banking system is to make loans - the economy can expand. The second is the Federal Reserve's interest rate for direct loans to banks. This, the discount rate, is falling out of favor as a monetary tool.