Capital briefs

* ASHCROFT'S PLAN: Sidestepping the debate over what the ideal tax system would be-flat or sales?-Missouri Sen. John Ashcroft (R.) is proposing a ten-point tax-cut plan that would save taxpayers an average of $200 billion a year over the next five years. Ashcroft announced the plan January 12 at the American Enterprise Institute. Besides adopting older proposals calling for the elimination of the tax code's marriage penalty and making the Social Security payroll tax a deductible item, Ashcroft wants to simplify the tax system by reducing the current five brackets to four.

Ashcroft would cut the lowest bracket-that for incomes up to $15,000-down to 10% from the current 15%, make similar reductions in the other brackets, but, out of fear of demagogic class-based attacks from Democrats, keep the highest bracket where it is, at 39.6%. He would, however, restore the personal exemptions and deductions that at present are phased out for those paying 39.6%. He would also eliminate the estate tax, the alternative minimum tax, and the 18month waiting period for lower rates on investment profits. Ashcroft says his plan targets low- and middle-income families: Taxes on a family of four making $30,000 a year would plummet by 87%; on a similar family making $70,000, 17%; and on a family earning $280,000, 6%.

* HERMAN INVESTIGATED: While her superiors, President Clinton and Vice President Gore, continue to get a free ride despite doing much the same thing, Secretary of Labor Alexis Herman now faces a preliminary investigation by the Justice Department into allegations that she took money in return for helping a business associate during her tenure as a White House staffer. She stands accused by African businessman Laurent Yene, who has said that, among other payments, he once gave Herman an envelope full of cash. In return, Herman supposedly helped 'a client of Yene obtain a license for a satellite telephone system. If Justice finds credible evidence of wrong-doing, Atty. Gen. Janet Reno will be required to seek appointment of an independent counsel.

* ARCHER STRIKES AGAIN: House Ways and Means Chairman Bill Archer (R.-Tex.) wrote House Majority Leader Dick Armey (R.), a fellow Texan, on January 11 demanding that Congress prevent the White House from making U.S. taxpayers cough up the $285,864 fine levied against Ira Magaziner and the Clinton Administration for lying to a federal court. Archer earlier called on President Clinton to fire Magaziner and "take all necessary steps to protect taxpayers from paying the . . . sanction."

"I believe it is unfair for taxpayers to pay the price for a wrongdoing which was carried out by people within the White House,'' Archer wrote Armey. "It's wrong to punish the taxpayers for the White House's dishonesty." Archer also said that if the President refuses to find another way to pay the fine, Armey should schedule a vote when it returns to find another method of payment. The White House continues to insist that taxpayers will be responsible for the fine (see HUMAN EVENTS last week, page 3).

* WHO HIRED LIVINGSTONE? Nearly five years have passed since political flunky D. Craig Livingstone was hired to run the White House Office of Personnel Security-a job Livingstone left in mid-1996 after it was discovered that his office had improperly obtained over 900 confidential FBI files of Reagan and Bush Administration personnel. Yet to this day no one, including Livingstone, will admit to knowing who was responsible for his being hired.

Contemporaneous notes taken by an FBI officer in 1993, however, contend that Livingstone had been highly recommended by Hillary Clinton-a charge the First Lady denies. Last week Whitewater Independent Counsel Kenneth Starr interviewed Hillary Clinton under oath about Livingstone and the FBI file scandal. No details of her testimony were revealed, but the White House claimed that the First Lady was "cooperating fully."

* FED'S ASIAN CONTAGION: "Jack Kemp believes it is a lack of a stable monetary arrangement which has led to these bad [economic] things we've seen in Asia and which Pat Buchanan is worried about;' Empower America economist Larry Hunter told HuMAN EVENTS. "One can chart it back to Federal Reserve actions in the early 1990s when there was a mini-inflation.

"The Fed spiked inflation up. And with the fixed currencies in Asia [pegged to the dollar], Asia imported that inflation, which injected liquidity into their economies and their banking system. Whenever you have currencies attached to the dollar, which is not attached to anything, it results in these problems because Federal Reserve policy affects those currencies. Jack believes the anchor should be gold and [Federal Reserve Chairman] Alan Greenspan agrees."

* IMF SOLUTIONS? Concerning the several congressional plans to help aid the ailing Asian economies, Cato Institute Senior Economist Jim Dorm told HuMAN EVENTs: `These are all govemment-dictated change. You have an alternative: It's called the market-based approach. Let the companies go bankrupt and let the investors who made these silly investments in the first place take a hit, and they won't do it in the future."