Capital Wrapup

COSMETIC CONTROVERSY

-- Food & Drug Administration officials are furrowing their brows over a new cosmetic craze--skin creams containing alpha-hydroxy acids. The creams, which promise to peel away the wrinkles of age, fall into that gray area between lightly regulated cosmetics and heavily reviewed drugs. The FDA plans to set up a consumer hot line to help determine if the creams produce rashes or other ailments in users and if the outfits involved make unproven medical claims. New regs could follow.

BANKING ON REFORM

-- With interstate banking approved, banks are gearing up for their next congressional battle: reform of the Glass-Steagall Act, which bars them from many securities activities. The American Bankers Assn. has set up a trade group to focus on banks' securities business. The ABA wants Glass-Steagall, which has been kept alive by the securities and insurance industries, repealed. The issue is on the agenda of new House Banking Committee Chairman Jim Leach (R-Iowa).

TRADE TURNCOAT

-- Say it ain't so, Max. Lobbyists were stunned when Senate trade subcommittee Chairman Max S. Baucus (D-Mont.)--a vocal backer of GATT--switched at the last minute and voted against the new world trade pact. Baucus cited his duty to represent Montanans, but pols saw another motive: Baucus is vulnerable to a GOP challenge in 1996. Since the vote wasn't close, Clintonites cut him slack. Says one top official: "We understood--but it looked so crassly political."