Rush to the Polls: Congress completed a $10.1 billion, five-year tax-reduction package in the final hours before its August recess. The package includes a one-year extension of the research and engineering tax credit. It also mandates a steady expansion of the equipment-investment tax credit for companies, which will rise from $17,500 in 1996 to $25,000 in 2003.

Terrorist Impact: The destruction on July 17 of the Paris-bound TWA Flight 800 prompted President Bill Clinton to renew his campaign for broader wiretapping authority for the FBI. The Republican-dominated House rejected the wiretap plan before recessing. However, the Senate may decide after Labor Day to back the extra wiretap authority, which would allow the FBI to electronically follow suspects as they switch phone numbers, cellular phones, and communications networks.

The FBI scored a significant victory when the House created a fund to pay for wiretap-easing modifications to the phone companies' new digital-phone switches. The modifications were approved by the 1994 Communications Assistance To Law Enforcement Act, whose funding has been bottled up by privacy advocates. The fund's money will be provided by law-enforcement and intelligence agencies, but it is not clear if those agencies will supply all the needed funds, estimated at $500 million to $10 billion over the next several years.

Crypto Update: Leaders of the seven major industrialized nations met in Paris in late July and released a vague policy declaration calling for international consultations on encryption. Countries should "accelerate consultations on encryption that allows, when necessary, lawful government access to data and communications to prevent or investigate acts of terrorism, while protecting the privacy of legitimate communications," said the declaration.

8(a) Wipe-Out: Rep. Jan Meyers, R-Kan., chairwoman of the House Committee on Small Business, introduced her bill to eliminate the 8(a) program on Aug. 2. However, there is little time for the bill to get through the House and Senate before the elections in November, when Meyers retires.

Hacking into Prison: Hackers who break into government computers in pursuit of classified data or financial information face jail terms of up to 10 years, under a bill passed by the Senate Committee on the Judiciary. The law must still win approval of the full Senate or the House.

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