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"They're acting like this is a high school exam. They flunked the exam in their body. They hope to do a makeup case in the Senate"

--Senator Patrick Leahy (D-Vt.) on House RepublicansEDITED BY ROBERT McNATTReturn to top

Leave GOP Bashing to the GOP

WITH A CIVIL WAR ERUPTING AMONG CAPITOL HILL REPUBLICANS over the future of the impeachment proceedings, many Democratic operatives are enjoying the spectacle.

The chaos, however, came perilously close to enveloping House Democrats in early January. That's when an angry group of a half dozen or so incoming freshmen, led by Jay Inslee of Washington, agitated for a vote in this year's more Democratic House to rescind or modify the articles of impeachment. The idea was to put incumbent pro-impeachment GOP moderates and freshmen Republicans on the hot seat by forcing them to revisit December's unpopular vote to impeach.

But during a spirited closed-door meeting on Jan. 5, House Minority Leader Richard Gephardt (D-Mo.) persuaded the hotheads to hold off. His reasoning: The Republicans are doing a good job of destroying themselves. "The temptation was high to create mischief, but cooler heads prevailed," said a senior Democratic staffer. So instead of guerrilla warfare in the House, Democrats cast a symbolic vote against the selection of House managers for the Senate trial.EDITED BY ROBERT McNATTReturn to top

Honda Could Use a Little Pickup

FINALLY, HONDA MAY GET SERIOUS about filling the missing link in its U.S. product line. Although the company sold more than 1 million vehicles in the U.S. in 1998 and the Accord was its best-selling single model here, Honda has always trailed import rival Toyota in total sales. It lacks a line of hot-selling pickup trucks that can compete with Toyota's Tacoma and upcoming full-size Tundra, let alone Ford and Chevy trucks.

That may be about to change. Says Thomas Elliott, executive vice-president of American Honda: "If Honda is going to grow, Honda is going to have to address the pickup situation." Although Elliott won't say flat out that Honda is ready to build pickups, it's clear the company is leaning that way. And analysts predict that Honda could have a pickup for sale here in less than two years.

But entering the market will be expensive, not the least because Honda will have to learn some new engineering tricks. A specialist in front-wheel-drive cars, it would have to begin building rear-wheel-drive vehicles. Most likely, it would also start with small trucks rather than the popular V-8s. Still, with its track record, no one is underestimating a new Honda truck.EDITED BY ROBERT McNATTReturn to top

Publishing: Purchase or Perish?

HERE'S A NOVEL WAY TO JUDGE THE PERFORMANCE OF PUBLISHING AND INFORMATION GIANTS: Count the acquisitions. In studying 29 media biggies between 1992 and 1997, Andersen Consulting found that those whose stock rose the most averaged 31 acquisitions. The laggards averaged only three.

According to Andersen, leading the pack was Dutch publisher VNU, which puts out Billboard and The Hollywood Reporter in the U.S. and which made about 60 acquisitions en route to a compound average annual return of 48%. The top U.S. companies included book publisher John Wiley, magazine group Meredith, and newspaper publisher Times Mirror, which had a 28% return with 27 small acquisitions--although the cost-cutting of CEO Mark Willes may have helped. "There's always exceptions, but there's a clear correlation" between deal flow and stock performance, says Andersen's David Brodwin.

Not all agree. A media banker who asked not to be identified says that the most acquisitive companies weren't the best performers when measured by benchmarks like operating cash-flow growth. Either way, how many publishers have time to read studies when they are so busy buying companies?EDITED BY ROBERT McNATTReturn to top

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