Balance Sheet

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Assets

Simple Pleasures. The push for a flat tax accelerates. Congressional leaders Bob Dole and Newt Gingrich appoint Jack Kemp to head a National Commission on Economic Growth and Tax Reform. The commission's goal: Develop a legislative agenda for the party including a single-rate income tax, cuts in regulations, and stable monetary policy. Meanwhile, presidential hopeful Sen. Arlen Specter (Pa.) proposes his own version of a flat tax.

Middle Movement. In publications from Newsweek to the Los Angeles Times, the myth of the vanishing middle class gets an unfriendly reception. A Wall Street Journal article suggests that the nascent microprocessor revolution will dramatically boost living standards for average workers. The American workforce will benefit further from collapsing trade barriers. Says Harvard's Jeffrey Sachs in the Journal, "We are in the midst of one of history's greatest expansions of market capitalism."

Swamp Thing. If at first you don't succeed….For the fifth straight year, Rep. Jimmy Hayes (D-La.) proposes sensible wetlands reforms. This time, they'll probably pass. His bill would exempt previously tilled farm land from wetlands regulations, separate ecologically valuable property from random puddles, and let landowners file for compensation when regulations "take" property. The Senate will consider a similar bill by Bennett Johnston (D-La.).

Beamed In. Paranoid about preserving the nation's "culture," the Canadian government shuts out U.S. cable channels. Under duress, DirecTV agrees not to connect its mini-satellite service to anyone with a Canadian address. Culture cops be damned, say Canadian entrepreneurs, who cross the border, buy mini-dishes, and sign people up for DirecTV using a U.S. maildrop as the billing address. Forbes says as many as 30,000 Canadians receive DirecTV signals.

Liabilities

Evolutionary Treatise. "Moderate" (a.k.a. statist) Republicans open the campaign to preserve their fiefdoms. Pols who oversee farm subsidies, public broadcasting, the Small Business Administration, and the National Endowments for the Arts and Humanities refuse to let GOP leaders zero out their projects. If the Republicans can't kill these turkeys, when will anybody dismember official Washington?

Misdiagnosis. Businesses rely heavily on managed care to contain medical costs. And Newt Gingrich isn't happy about it. At a meeting of the American Medical Association, Gingrich calls for congressional hearings to investigate the "accumulation of power" HMOs have gained in the delivery of medical services. But, as Wall Street Journal columnist Tim Ferguson notes, HMOs may be the only way to contain Medicaid and Medicare costs—unless we go to a single-payer system.

Rule Breaking. The Occupational Safety and Health Administration thumbs its nose at the House moratorium on regulations. (See "Slash and Burn?," May.) OSHA starts issuing rules on "ergonomics," a Bush-era bright idea that could cost job sites $21 billion to implement. Since a regulatory moratorium hasn't passed the Senate, OSHA bureaucrats may slip these expensive rules past fuming legislators and business owners.

Luddite Legions. The Fifth Conference on Computers, Freedom, and Privacy gives technology bashers center stage. CFP—an agenda-defining techno-gathering—is never a haven for backers of large corporations or big government. But this year's version features "The Case Against Computers," a panel with two deep ecologists, an on-line political activist, and left-wing guru Theodore Roszak. Inexplicably, the San Francisco-based conference ignores national identity cards, employer sanctions, and other issues linking privacy and immigration.

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