Greenspan Sees Slowing Growth

Federal Reserve Chairman Alan Greenspan is scheduled to testify about the economy again today, this time before the Senate Banking Committee. Yesterday, Greenspan told a House Banking subcommittee that the central bank would raise interest rates if needed to head off inflation, but suggested that might not happen anytime soon. In a semi-annual Humphrey-Hawkins report to Congress, Greenspan said he expects growth to moderate from its breakneck pace at the start of the year, but added that he is unsure whether that will be enough to prevent economic strains. The Dow Jones industrial average hit a new high. It opens up today 154.93 points at 8,061.65.

Lawmakers Criticize Greenspan

Despite a U.S. economy that is the envy of the world, Federal Reserve chief Alan Greenspan is being criticized by members of Congress on both sides of the political spectrum. The barbs at Greenspan's testimony before a House Banking subcommittee yesterday ranged from a socialist warning Greenspan against ripping the social fabric of the country to a Republican questioning if the central bank was analyzing bad data. Rep. Barney Frank applauded the central bank's increased accountability and transparency, but the Massachusetts Democrat criticized the Fed for striving to lower inflation rather than working to cut the unemployment rate.

Business Experts on Capitol Hill

U.S. business representatives and academics said they will make a case for full employment and against higher interest rates when they testify before the House Banking Committee today. Federal Reserve Chairman Alan Greenspan yesterday delivered his Humphrey-Hawkins testimony before a subcommittee of the House Banking Committee, which has summoned 11 experts to testify on monetary policy today. The experts include some Wall Street Fed watchers, generally considered inflation "hawks," and some more "dovish" analysts.

Gingrich Tries to Quell Turmoil

House Speaker Newt Gingrich is trying to quell turmoil within the Republican Party. A Gingrich spokeswoman said he has urged members not to seek a vote on his leadership at a meeting today of all 238 Republicans. Gingrich urged his Republican supporters yesterday to focus on major tax and spending bills and put aside differences. But many lawmakers, some firm Gingrich suppoters, said they would press for a full airing soon of the issues that brought them to the point where a group of dissidents plotted to oust their speaker earlier this month, and a high-ranking Republican was forced to quit his leadership post.

Republicans Agree on Tax Stance

House and Senate Republicans have agreed to a stance on tax legislation from which they will bargain with the White House. Senate Budget Committee Chairman Pete Domenici says Republicans are ready to begin discussing the plan with the White House sometime today. The Republican plan includes items opposed by President Clinton, such as a reduction in the maximum capital gains tax rate to 20 percent from the current 28 percent. Despite their plans to go forward, the Republicans remain at odds over some issues. They have yet to decide whether a cigarette tax increase will be included in the final tax proposal. The Senate bill includes a 20-cents per pack cigarette tax increase, but House Republicans have said there was little support for that tax increase on their side.

Senate Panel to Vote on Immunity

A Senate panel probing campaign finance scandals plans to vote today on granting immunity to four Buddhist nuns who donated money to the Democratic Party in 1996. Republican senators accused the Justice Department yesterday of blocking the investigation into campaign finance scandals and threatened to go to court to force the appointment of an independent counsel. Tennessee Sen. Fred Thompson, chairman of the Senate Governmental Affairs Committee, said he had lost confidence in the Justice Department, which he said had consistently thrown obstacles into his path. The agency opposes granting immunity to the nuns.

Lawyer: Huang Unlikely to Talk

An attorney for former Democratic Party fund-raiser John Huang says it appeared unlikely his client will testify before a Senate panel investigating campaign finance scandals. Attorney Ty Cobb, speaking on Fox New Channel's "Fox on Politics", said the Senate Governmental Affairs Committee apparently had no interest in offering immunity to Huang in exchange for his testimony. Republicans are trying to show that while he worked at the Commerce Department, Huang may have betrayed U.S. secrets to his former employer, the Indonesian-based Lippo industrial conglomerate, which in turn could have passed them on to China.

Whitewater Trial Postponed

A federal judge has postponed indefinitely the second Whitewater trial of former Arkansas governor Jim Guy Tucker, saying he is too sick to go through another prosecution. In a setback for Whitewater prosecutor Kenneth Starr, U.S. District Judge Stephen Reasoner in Little Rock said he was persuaded by doctors' opinions that Tucker, who had a liver transplant late last year, is unable to face the bankruptcy fraud trial scheduled for September. Starr had submitted a written brief opposing a delay and sought a hearing at which he said doctors would testify that Tucker's recovery would not prevent a September trial.

Panel OKs Arts Measure

The Senate Appropriations Committee has passed a $13.7 billion spending bill that would keep the National Endowment for the Arts alive, buy land to protect Yellowstone National Park from a mine and save ancient trees in California. The bill, which mainly funds lands, energy and Native American programs, met all of the priorities in a budget agreement between congressional leaders and the White House -- including funding for national parks and protection of the Everglades. In contrast to the House, which wiped out funding for the NEA, the Senate panel approved $100 million for the agency. The House voted 414-12 last night to approve a bill providing vocational education grants. The bill would provide $1.3 billion in the financial year beginning in October and an estimated $6.5 billion over five years.

Canada Tries to Defuse US Tension

Canadian politicians are seeking to defuse escalating tensions with the United States over Pacific salmon, after angry Canadian fishermen lifted their blockade of an Alaska ferry. Canadian fishermen late Monday lifted a three-day blockade of an Alaskan ferry following a court order. Canadian Foreign Minister Lloyd Axworthy flies to Washington today for a meeting with U.S. Deputy Secretary of State Strobe Talbott to discuss a range of issues including the salmon fishing controversy, the U.S. State Department said. A Canadian Foreign Affairs spokeswoman said Axworthy also hopes to meet with senators from U.S. Pacific-Northwest states during his visit to discuss the salmon issue.

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