Balance Sheet

Assets

? Party On. Happy New Year: The "Misery Index"--the inflation plus unemployment rates--sinks below 7 percent, its lowest level in three decades.

? Taxachusetts, RIP? Massachusetts will elect a governor in November, and the tax-cutting party started by Bill Weld goes bipartisan. Gov. Paul Cellucci (the Republican front-runner) signs Americans for Tax Reform's pledge to never raise taxes and vows to cut the income tax rate from 5.95 percent to 5 percent. Cellucci's probable opponent, Democratic Attorney General Scott Harshbarger, pushes a $1.5 billion tax cut based on lower rates and higher personal exemptions.

? Rules Rule. The World Trade Organization rejects a suit filed by the U.S. government for Eastman Kodak alleging that Japanese bureaucrats and Fuji conspire to keep foreign film companies out of Japan. Consumers win, as the WTO decision keeps the United States from imposing tariffs or other trade sanctions.

? Motion Sickness. Congress temporarily puts OSHA micromanagers on hold. Legislators cut off funding for the implementation of squishy new "ergonomics" regulations that could have given OSHA power to redesign most of the nation's work sites. Besides eliminating ergonomics money from OSHA's budget, Congress stops the agency from enforcing any ergonomics cases against companies this fiscal year.

Liabilities

? Child Abuse. Requesting additional tax dollars to fight AIDS, Bill Clinton falsely invokes "the children." "HIV is affecting more and more young people," the president says. In fact, over the past year the Centers for Disease Control and Prevention note a 13 percent drop in AIDS cases among pre-teens.

? Riling Rosie. In its alarmist campaign against the fat substitute Olestra, the Center for Science in the Public Interest deceptively enlists talk-show host Rosie O'Donnell. When O'Donnell turns down the chance to make commercials promoting Frito-Lay's Olestra-laden "Wow" chips, a CSPI press release states she did so because she thinks Olestra is unsafe. Not true, says O'Donnell's agent. She just decided not to take the offer.

? Choke Hold. Every state but New Hampshire has mandatory seat belt laws. But about a third of drivers refuse to buckle up. The White House pushes states to make seat belt laws even tougher: It may withhold highway funding if states refuse to set up random motorist stops or upgrade seat belt violations from mere traffic offenses to misdemeanors.

? Slaying Tigers. South Korea's "bailout" by the International Monetary Fund is, ironically, a Buchananite's dream. The higher taxes, government "investment" (read: spending), and heightened financial regulations attached to the IMF's dollars will choke off South Korea's market for exports and imports. Will the IMF soon offer similar "help" to Indonesia?