[20800001] |The growing crowd of Japanese investors buying up foreign companies aren't all strait-laced businessmen in dark suits. [20800002] |Yasumichi Morishita, whose art gallery last month became a major shareholder in Christies International PLC, the London auction house, is one man who doesn't fit the mold. [20800003] |In Japan, he's known in racy weekly magazines as the "King of Shady Money." [20800004] |If nothing else, the 57-year-old's past has its share of dents. [20800005] |Nearly 20 years ago, Mr. Morishita, founder and chairman of Aichi Corp., a finance company, received a 10-month suspended sentence from a Tokyo court for violating a money-lending law and an income tax law. [20800006] |He was convicted of charging interest rates much higher than what the law permitted, and attempting to evade income taxes by using a double accounting system. [20800007] |He's had other brushes with the law. [20800008] |He was arrested, though not indicted, on at least three other occasions in the '60s and '70s: for assault and unlawful confinement, for fraud and forgery of private documents, and for extortion. [20800009] |Christies says it has had no contact with Mr. Morishita since the stock purchase, but that it's happy to deal with him. [20800010] |"We like to make our own judgments" about Mr. Morishita, says Christopher Davidge, Christies' group managing director. [20800011] |"People have a different reputation country by country." [20800012] |Mr. Morishita is a leading figure among Japan's 38,000 "machikin," which lend to small companies, and "sarakin," which lend to individuals. [20800013] |Many of these financiers lend freely, often without demanding collateral. [20800014] |But the interest rates they charge are often near Japan's 54.75% legal limit, says Kenji Utsunomiya, a lawyer specializing in loan troubles. [20800015] |Aichi is a machikin, Mr. Utsunomiya says, and "one of the nasty ones." [20800016] |In describing that business in general, he says that when the client can't repay the loan, some machikin "clutch on like hyenas" and even take over the client's company. [20800017] |Last month, Mr. Morishita's new gallery, Aska International Ltd., purchased 6.4% of Christies for #33 million ($53.3 million). [20800018] |Acquired from Carisbrook Holdings U.K. Ltd., a company owned by Australian financier Robert Holmes a Court, the stake was apparently the first of its kind for Aska, an entity separate from Aichi. [20800019] |And the acquisition, which made Aska one of Christies' top five shareholders, left many people wondering who this man was and what his intentions were. [20800020] |"We're an investor," Mr. Morishita says, sitting back in his purple gallery filled with some 20 Monets and Renoirs. [20800021] |"In the long run, the {stock} prices will go up." [20800022] |It's not clear whether Aska plans to buy more shares. [20800023] |But Christies, Mr. Morishita insists, is happy to see him become a long-term stockholder. [20800024] |Mr. Morishita considers himself a connoisseur of art. [20800025] |In 30 years of collecting impressionist and Japanese paintings, he has acquired 600 items, he says, enough to persuade him to start a museum next year. [20800026] |He says he spent $300 million on his art business this year. [20800027] |A week ago, his gallery racked up a $23 million tab at a Sotheby's auction in New York buying seven works, including a Picasso. [20800028] |"He makes snap judgments," says Kiyotaka Kori, the art gallery's manager and Mr. Morishita's secretary for more than seven years. [20800029] |Mr. Morishita's main business certainly appears to be thriving, although he won't disclose numbers. [20800030] |According to Teikoku Data Bank Ltd., which tracks company earnings, Aichi's revenue rose 15% to 49.3 billion yen ($348.4 million) in the year ended February. [20800031] |Revenue doubled from two years ago. [20800032] |That is, if the company reported results correctly. [20800033] |The Asahi Shimbun, a Japanese daily, last month reported that Aichi revised its tax calculations after being challenged for allegedly failing to report all of its income to tax authorities over a two-year period. [20800034] |The Tokyo Regional Taxation Office declines to comment, and Mr. Kori, the tycoon's secretary, says the problem simply resulted from a difference of opinion over what was considered income. [20800035] |The small, wiry Mr. Morishita comes across as an outspoken man of the world. [20800036] |Stretching his arms in his silky white shirt and squeaking his black shoes, he lectures a visitor about the way to sell American real estate and boasts about his friendship with Margaret Thatcher's son. [20800037] |But when asked what exactly he does in business, he immediately takes offense. [20800038] |"Are you stupid?" he snaps. [20800039] |"You should know what questions to ask to get people to answer." [20800040] |Not many people know the details of Mr. Morishita's business, but it's a source of rumors about shady dealings. [20800041] |When a small company goes belly-up, for instance, the gossipy weekly magazines are often quick to link the demise with Aichi. [20800042] |Mr. Morishita scoffs at those stories, as well as the ones connecting him to the Japanese mob. [20800043] |He says he has never even dined with gangsters. [20800044] |The seventh child of a store owner in Aichi prefecture, Mr. Morishita started out in the textile business. [20800045] |From there, he set up his finance company and rapidly expanded from lending to investment in real estate to building golf courses. [20800046] |He spends most weekends flying his helicopter to one of his nine courses, he says, two of which were designed by Jack Nicklaus. [20800047] |He also owns courses in the U.S. and France. [20800048] |The gruff financier recently started socializing in upper-class circles. [20800049] |Although he says he wasn't keen on going, last year he attended a New York gala where his daughter made her debut. [20800050] |He also leads an opulent life style. [20800051] |Even in Denenchofu, one of Tokyo's richest neighborhoods, Mr. Morishita's splashy brick manor -- one of some 10 houses he owns -- outshines the neighbors'. [20800052] |A lavish white portico with a stained-glass window towers over the brick wall surrounding his property. [20800053] |Although Mr. Morishita says little about his business, he offers one rule to success: Never gamble too far. [20800054] |"I quit after one try, whether I win or lose," he says. [20800055] |"I'm done in two minutes." [20800056] |Mr. Morishita says he intends to expand his business to many other areas at home and abroad. [20800057] |He'll be there wherever there's money to be made, laughs Mr. Kori, the secretary. [20800058] |"Who knows," he says, "if he heard that soybeans make money today, he might be flying out to Chicago tomorrow. [20801001] |WHO'S NEWS: [20801002] |Arthur Price resigned as president and chief executive officer of MTM Enterprises Inc., a Studio-City, Calif., entertainment concern. [20801003] |He co-founded the company with Grant Tinker and Mary Tyler Moore in 1969. [20801004] |MTM is a unit of British-based TVS Entertainment PLC, whose chief executive officer, James Gatward, will oversee the company until a successor is named. [20802001] |As expected, First Interstate Bancorp reported a net loss of $15.5 million for its third quarter because of hemorrhaging at its First Interstate Bank of Arizona unit. [20802002] |The Los Angeles-based bank holding company disclosed last Friday that it had taken a huge $350 million provision for loan losses at the Arizona bank, the result of the state's worsening real-estate market. [20802003] |In yesterday's report, First Interstate said its bank in Texas also reported a loss of $23.5 million for the quarter. [20802004] |But it said that its consumer banks in Oregon, California, Nevada and Washington performed well during the quarter and that nonperforming assets at these banks declined by 14% over the year-ago period. [20803001] |Private-sector union contracts signed in the third quarter granted slightly lower wage increases than those signed in the second quarter, but wage increases still are running above last year's levels. [20803002] |The Labor Department said wage settlements in the third quarter called for average annual wage increases of 3.6% in the first year and 3.0% over the life of the contracts. [20803003] |The last time parties to these settlements negotiated wage increases, mostly in 1986 or 1987, wages increased an average of 2.4% a year over the life of the contracts. [20803004] |If this pattern continues, the Labor Department said, 1989 will be the first year that the measure has shown an increase since 1981 when the department started comparing expiring contracts with those that replaced them. [20803005] |This reflects the restoration of wage cuts in the steel and other industries as well as higher wages granted nurses who work in health-care facilities. [20803006] |Settlements reached in the first nine months of 1989 called for wage increases averaging 3.7% in the first contract year and 3.1% annually over the life of the contracts, the department said. [20803007] |For all of 1988, union contracts provided for 2.5% wage increases in the first year and 2.4% over the life of the contracts. [20803008] |In the second quarter, contracts called for increases of 3.9% in the first year and 3.4% over the life of the contracts. [20803009] |The figures exclude lump-sum payments and cost-of-living adjustments, so the actual wage increases may have been bigger. [20803010] |About 35% of the workers covered by contracts signed in the first nine months of year get lump-sum payments; about 15% are covered by cost-of-living clauses. [20803011] |Unions covered by one or other provisions generally settled for lower percentage wage increases. [20803012] |The Labor Department said wage increases in manufacturing industries continue to be smaller than those in other industries. [20803013] |For all six million workers under major collective bargaining agreements, regardless of when they were signed, wage increases in the first nine months of 1989 averaged 2.5% -- including cost-of-living adjustments. [20804001] |An enormous turtle has succeeded where the government has failed: He has made speaking Filipino respectable. [20804002] |The 6 1/2-foot-tall turtle, Pong Pagong, is a character who stars in the children's television show "Batibot." [20804003] |He speaks only in Filipino. [20804004] |"Batibot," which started in 1983 as a hybrid of the U.S. program "Sesame Street," has developed into a distinctly Philippine effort. [20804005] |Radio programs and books have followed the daily television show. [20804006] |In the process, "Batibot," an archaic Filipino word meaning "strong" or "enduring," has become a powerful advocate of the use of the Filipino language. [20804007] |"It impresses on ordinary, young Filipinos that there's nothing to feel inferior about in using their own language," says Randy David, a sociologist and host of a popular television talk show. [20804008] |"When we started the program six years ago, the use of Filipino was deemed unwise by the predominantly middle class," says Lydia Brown, the program's creator. [20804009] |Now, she says, "it's no longer an issue." [20804010] |The success of "Batibot" stands in marked contrast to many academic and government attempts to promote Filipino as a national language. [20804011] |Filipino -- once known as Pilipino -- is predominantly Tagalog, the Malay-based language spoken in a part of the country's principal island of Luzon. [20804012] |Resistance to a national language comes primarily from members of the country's elite, who generally prefer English. [20804013] |But while better-off Filipinos are quick to cite the logic in using a language as widespread as English, they are often slow to reveal that they are prejudiced against Filipino, say advocates of the native language. [20804014] |"For the middle and upper-middle class {Filipino} is declasse," says Bien Lumbera, a Philippine-studies professor at Quezon City's University of the Philippines. [20804015] |There's also resentment. [20804016] |Other opponents of Filipino come from non-Tagalog regions. [20804017] |They argue that their own languages should have equal weight, although recent surveys indicate that the majority of the country's population understands Filipino more than any other language. [20804018] |(There are seven major languages and more than 70 dialects in the country.) [20804019] |What tongue to speak is an emotional mine field in the Philippines. [20804020] |It is entrenched in the country's colonial bonds to the U.S., in Philippine class structure, in the regional loyalties of its people and in its island geography. [20804021] |As they did when the Philippines was a colony of the U.S., teachers for the most part teach in English, even though it is a foreign language for most Philippine children. [20804022] |As a result, they often speak one language at home, another at school. [20804023] |Mrs. Brown calls the modern-day cultural ambivalence to Filipino a "language schizophrenia." [20804024] |The issue has been simmering for years. [20804025] |It doesn't take much to provoke an intense debate. [20804026] |When President Corazon Aquino, whose command of Filipino is spotty, announced last year that the language would be used in official communications, there was an uproar from many legislators, who continue to conduct debates mostly in English. [20804027] |But many proponents of Filipino see resistance to the language finally crumbling. [20804028] |They believe the media, including "Batibot," have played a crucial role. [20804029] |According to chief scriptwriter Rene Villanueva, "Batibot" doesn't set out to advance the cause of Filipino. [20804030] |"It's not as if we're teaching language per se," he says, "We're just using it." [20804031] |These days, "Batibot" is produced in a converted lumberyard on a shoestring budget of $3,000 a one-hour segment. [20804032] |It is shown weekdays on two of the country's five networks. [20804033] |With an audience totaling more than 400,000, "Batibot" consistently ranks in the country's top-four most-watched daytime programs. [20804034] |But advertising revenue is inadequate. [20804035] |Periodically, there are threats that the program will fold. [20804036] |"Batibot" lacks the polish of "Sesame Street." [20804037] |Sound stages echo. [20804038] |Acting sometimes falls flat. [20804039] |There are only two large puppets in the program: Pong Pagong and a monkey named Kiko Matsing. [20804040] |But the production is the equal of any local program. [20804041] |And the show's creativity makes up for any technological deficiencies. [20804042] |The program isn't afraid to tackle controversial topics such as nuclear weapons and the environment. [20804043] |Not that the language war is won, even on "Batibot." [20804044] |During one recent episode, all the advertisements were in English. [20805001] |CMS ENERGY Corp. said management would recommend to its board today that its common stock dividend be reinstated at a "modest level" later this year. [20805002] |The Dearborn, Mich., energy company stopped paying a dividend in the third quarter of 1984 because of troubles at its Midland nuclear plant. [20805003] |In addition, CMS reported third-quarter net of $68.2 million, or 83 cents a share, up from $66.8 million, or 81 cents a share, a year ago. [20806001] |HEALTHDYNE Inc., Atlanta, said its subsidiary, Home Nutritional Services Inc., registered with the Securities and Exchange Commission an initial public offering of four million shares of common. [20806002] |The in-home health care services provider said it will sell 1.8 million of the new shares, while Home Nutritional Services will sell the remaining 2.2 million. [20806003] |The company estimates the offering price at between $14 and $16 a share. [20806004] |The company said it expects to use the proceeds to repay certain bank debt and for general corporate purposes, including establishing new operating centers and possible acquisitions. [20806005] |Home Nutritional currently has 10 million shares outstanding. [20806006] |It will have 11.8 million shares outstanding after the offering, with Healthdyne owning about 65% of the total. [20807001] |Black & Decker Corp. said it agreed to sell its Bostik chemical adhesives unit to Orkem S.A., a French chemical company, for $345 million. [20807002] |Bostik is the first Emhart Corp. unit to be sold as part of the power-tool manufacturer's effort to reduce debt and consolidate operations after it acquired Emhart earlier this year. [20807003] |Black & Decker said it plans to put other Emhart units on the block in the future, with the goal of raising $1 billion in net proceeds. [20807004] |Black & Decker rescued Emhart from the takeover bid of Topper Limited Partnership last March by agreeing to acquire the maker of door locks and gardening tools for about $2.8 billion. [20807005] |The move significantly expanded Black & Decker's product line, but also significantly increased its debt load. [20807006] |The acquisition boosted Black & Decker's ratio of debt to total capital to more than 80%. [20807007] |Company officials have said they plan to reduce that ratio to less than 50% over the next 2 1/2 years. [20807008] |Earlier this year, Black & Decker put three Emhart businesses on the auction block: the information and electronics segment, the Dynapert electrical assembly business and Mallory Capacitors. [20807009] |The three units had combined 1988 sales of about $904 million. [20807010] |The three units contributed about a third of Emhart's total sales. [20807011] |In addition, Black & Decker had said it would sell two other undisclosed Emhart operations if it received the right price. [20807012] |Bostic is one of the previously unnamed units, and the first of the five to be sold. [20807013] |The company is still negotiating the sales of the other four units and expects to announce agreements by the end of the year. [20807014] |The five units generated sales of about $1.3 billion in 1988, almost half of Emhart's $2.3 billion revenue. [20807015] |Bostic posted 1988 sales of $255 million. [20807016] |"Our divestiture program is on schedule, and we remain confident that we will achieve our stated goal of over $1 billion in net proceeds," said Nolan D. Archibald, Black & Decker's president and chief executive officer, in a statement. [20807017] |The sales are an attempt to quell investor concern about Black & Decker's increased debt burden from the Emhart purchase. [20807018] |The company's stock plunged when it first announced that it planned to acquire Emhart. [20807019] |The company maintains that it doesn't expect Emhart to contribute to earnings for about another 12 months. [20807020] |In composite trading on the New York Stock Exchange, Black & Decker closed at $19.75 yesterday, down 25 cents. [20807021] |The company didn't announce the sale until after the close of the market. [20808001] |Dick Darman, call your office. [20808002] |Embedded in the "budget" being concocted by the House-Senate conference committee is something that looks, smells and waddles like a duck. [20808003] |It's a nuisance tax on mergers. [20808004] |Congress has decided to raise $40 million by charging companies $20,000 for the honor of filing the required papers under the Hart-Scott-Rodino law. [20808005] |Ever since the bad days of Big is Bad antitrust enforcement, this law has required that anyone proposing a merger must make a filing describing the effects on all relevant markets. [20808006] |The Hart-Scott filing is then reviewed and any antitrust concerns usually met. [20808007] |Typically, Hart-Scott is used now to give managers of target firms early news of a bid and a chance to use regulatory review as a delaying tactic. [20808008] |The $20,000 tax would be a small cost in a multibillion-dollar deal, but a serious drag on thousands of small, friendly deals. [20808009] |One especially dangerous aspect to the new tax would be that the proceeds will be used to increase the budgets of the antitrust division at Justice and the Federal Trade Commission. [20808010] |This amounts to a bounty for regulators -- the more regulating the more they get to keep. [20808011] |Also, as former Reagan antitrust chief Charles Rule has noted, this would "establish the precedent that the government may charge parties for the privilege of being sued regardless of whether the government prevails." [20808012] |Yet another opportunity for President Bush to respond, "Read my lips. [20808013] |Line-item veto. [20809001] |Michael Grobstein, 46 years old, was named vice chairman for planning, marketing and industry services, a new post. [20809002] |Mr. Grobstein had been a vice chairman of Ernst & Whinney, an accounting firm that merged with rival Arthur Young in July to form Ernst & Young, a major accounting, tax and management consulting firm. [20809003] |Mr. Grobstein's appointment formalizes a role he has been performing since the merger, a spokeswoman said. [20810001] |Cie. de Navigation Mixte Chairman Marc Fournier said his board unanimously rejected as too low the $1.77 billion bid by Cie. Financiere de Paribas to bring its stake in Navigation Mixte to 66.7%. [20810002] |At a news conference, Mr. Fournier accused Paribas of planning to pay for the takeover by selling parts of the company, whose interests include insurance, banking, tuna canning, sugar and orange juice. [20810003] |The chairman said his board members, including representatives of West German insurance giant Allianz AG and French banks Credit Lyonnais and Societe Generale, hold nearly 50% of Navigation Mixte's capital. [20810004] |Mr. Fournier said that as Navigation Mixte chairman, he is prohibited by takeover regulations from organizing his own defense or doing anything besides managing current company business. [20810005] |But sources said he will be urging his allies to boost their stakes in Navigation Mixte, which is being traded in London and is to resume trading in Paris Tuesday. [20810006] |At the same time, he is expected to seek legal and regulatory means of blocking or delaying Paribas's bid. [20810007] |For the moment, the sources said, he has decided against seeking a white knight or organizing a counterbid for Paribas. [20810008] |Mr. Fournier said Navigation Mixte's 1989 unconsolidated, or parent-company, profit is likely to be 4.7 billion francs ($754.4 million), up from 633.8 million francs last year. [20810009] |That is due mostly to payments from Allianz for most of the 50% stake it has agreed to acquire in Navigation Mixte's insurance business. [20810010] |Mr. Fournier said the exceptional gain would mean nearly twice as high a dividend this year as last. [20810011] |If holders avoid tendering to Paribas, he added, they can expect strong dividends again next year. [20810012] |Analysts noted that over the past 20 years, Mr. Fournier has built his company through astute stock-market activity and has warded off at least three takeover attempts. [20810013] |This time, however, some analysts think he could face a real battle. [20810014] |"Without some unexpected "coup de theatre", I don't see what will block the Paribas bid," said Philippe de Cholet, analyst at the brokerage Cholet-Dupont & Cie. [20810015] |Mr. de Cholet said Mr. Fournier's biggest hope was to somehow persuade regulatory authorities to block the bid. [20810016] |Paribas still needs the go-ahead from the Commission des Operations de Bourse, a government regulatory agency, but analysts said that is considered likely. [20810017] |Mr. Fournier also noted that Navigation Mixte joined Paribas's core of shareholders when Paribas was denationalized in 1987, and said it now holds just under 5% of Paribas's shares. [20810018] |Once he realized that Paribas's intentions weren't friendly, he said, but before the bid was launched, he sought approval to boost his Paribas stake above 10%. [20810019] |The petition is still pending, but Mr. Fournier downplayed the likelihood of his organizing a takeover bid of his own for the much-larger Paribas. [20810020] |One big question now is the likely role of Mr. Fournier's allies. [20810021] |Mr. Fournier said the large institutions that hold nearly 50% of Navigation Mixte's capital all strongly support him, but some analysts said they aren't so sure. [20810022] |Allianz, for example, has said in official comments so far that it will remain neutral. [20810023] |Paribas is Allianz's lead French bank. [20810024] |Paribas said Monday that it intends to bid to boost its stake in Navigation Mixte to 66.7%, from the 18.7% it already owns. [20810025] |The purchase of the additional 48% stake is expected to cost more than 11 billion francs ($1.77 billion). [20810026] |Paribas says it will offer 1,850 francs ($296.95) each for Navigation Mixte shares that enjoy full dividend rights, and 1,800 francs each for a block of shares issued July 1, which will receive only partial dividends this year. [20810027] |Alternatively, it is to offer three Paribas shares for one Navigation Mixte share. [20810028] |The Paribas offer values Navigation Mixte at about 23 billion francs, depending on how many of Navigation Mixte's warrants are converted into shares during the takeover battle. [20811001] |BLOCKBUSTER ENTERTAINMENT CORP. said it raised $92 million from an offering of liquid yield option notes. [20811002] |The gross proceeds from the sale of the notes, which will be due on Nov. 1, 2004, will be used to reduce existing debt and for general corporate purposes, the company said. [20811003] |The debt reduction is expected to save the Fort Lauderdale, Fla. home video concern about $2 million a year in interest expense. [20811004] |The zero-coupon subordinated notes have no periodic interest payments. [20811005] |Each note is being offered at $308.32 per $1,000 principal amount at maturity, representing an 8% yield to maturity. [20811006] |In addition, each note can be converted into Blockbuster Entertainment common stock at a rate of 13.851 shares per note. [20811007] |Merrill Lynch Capital Markets Inc. is the sole underwriter for the offering. [20811008] |The notes will have a principal amount of $300 million at maturity. [20811009] |Blockbuster shares closed yesterday at $18.75, down $1.125, in New York Stock Exchange trading. [20812001] |The 1986 Tax Reform Act has nearly eliminated the number of large, profitable corporations that don't pay federal income tax, according to Citizens for Tax Justice, a nonprofit, labor-funded research and lobbying group. [20812002] |In a study of 250 of the nation's richest companies, the group found that only seven managed to avoid paying federal income taxes last year compared with 40 in 1986, the last year the old tax rules were in effect, and 16 in 1987, when some of the new tax provisions went into effect. [20812003] |Moreover, 41 companies that paid no federal income tax from 1981 through 1985 -- despite billions of dollars of profits -- ended up paying an average of 27.9% of their income in federal taxes in 1988. [20812004] |The report, released yesterday, comes as Congress is considering a number of special tax breaks only three years after the sweeping tax-revision legislation abolished or curtailed many loopholes. [20812005] |In the corporate realm, the 1986 law abolished the investment-tax credit, scaled back use of an accounting method that allowed large contractors to defer taxes until a project was completed and strengthened the so-called alternative minimum tax, a levy to ensure all money-making businesses pay some federal tax. [20812006] |The combination of lower rates and fewer loopholes has meant that the so-called average effective tax rate -- the rate actually paid -- of the 250 corporations surveyed reached 26.5% in 1988, compared with 14.3% in the years from 1981 through 1985, according to the study. [20812007] |In addition, corporations are now shouldering a bigger share of the tax burden, as the authors of the 1986 law hoped. [20812008] |Corporate taxes paid for almost 12% of federal spending in 1988 -- excluding Social Security -- compared with less than 8% in the first half of the 1980s, the study found. [20812009] |"Tax reform is working," the study said. [20812010] |"Under the new tax-reform law, the days of widespread, wholesale corporate tax avoidance have come to an end." [20812011] |Still, Kroger Co., Pinnacle West Capital Corp., CSX Corp., Illinois Power Co., Media General Inc., Santa Fe Southern Pacific Corp. and Gulf States Utilities Co., didn't pay any federal income tax last year although they garnered a total of $1.2 billion in profits, the group said. [20812012] |In fact, six of those companies received refunds, which totaled $120 million. [20812013] |The lobbying group used publicly available information to calculate each company's domestic profits and its federal income tax payments. [20812014] |This is the fifth year Citizens for Tax Justice has released a study on corporate tax bills. [20812015] |Earlier reports, which revealed that as many as 73 companies were avoiding income tax legally, have been credited with helping galvanize efforts to overhaul the tax code. [20812016] |But even though companies are paying more taxes, many are still paying less than the statutory rate, the report said. [20812017] |And 45 companies paid effective tax rates of below 10% of their income. [20812018] |"While the overall picture is very encouraging, significant corporate tax avoidance continues," the study said. [20812019] |Glenn Hall contributed to this article. [20813001] |F. Gil Troutman, 46 years old, was named chief executive officer. [20813002] |He retains his titles of president and chief operating officer and succeeds as chief executive Howard O. Painter Jr., who remains chairman of the board. [20813003] |DSP makes electronic instrumentation and data acquisition systems. [20814001] |In search of buyers for upscale department-store chains such as Bloomingdale's and Saks Fifth Avenue, investment bankers are turning to -- who else? The Japanese. [20814002] |But so far Japan's cash-rich retailers are proving to be cautious shoppers. [20814003] |"We have the money to buy. [20814004] |But operating a U.S. department-store chain would be very difficult," says Motoyuki Homma, managing director of the international division at Mitsukoshi Ltd., one of Japan's leading department stores. [20814005] |Japanese retail executives say the main reason they are reluctant to jump into the fray in the U.S. is that -- unlike manufacturing -- retailing is extremely sensitive to local cultures and life styles. [20814006] |The Japanese have watched the Europeans and Canadians stumble in the U.S. market, and they fret that business practices that have won them huge profits at home won't translate into success in the U.S. [20814007] |Japanese department stores are also wary of attracting negative publicity. [20814008] |After Sony Corp. 's recent headline-grabbing acquisition of Columbia Pictures, many say it makes good political sense to lie low. [20814009] |"It's a question of timing," says Mayumi Takayama, managing director of international operations at Isetan Co., a Tokyo department store. [20814010] |Still, for those with a long-term eye on the vast U.S. retail market, this is a tempting time to look for bargains. [20814011] |Britain's B.A.T Industries PLC is trying to unwind its U.S. retailing operations, which include such well-known stores as Saks Fifth Avenue, Marshall Field's, Breuners and Ivey's. [20814012] |And debt-ridden Campeau Corp. of Toronto is giving up the 17-store Bloomingdale's group. [20814013] |"Every department store in Japan is taking a look," says Mike Allen, a retail analyst at Barclay's de Zoete Wedd Securities (Japan) Ltd. [20814014] |Mr. Allen, however, doesn't think that Japan is about to embark on a major buying binge. [20814015] |Nonetheless, speculation heated up yesterday when Tokyu Department Store Co. confirmed a report in Nihon Keizai Shimbun, Japan's leading business daily, that Tokyu is talking with Campeau about buying Bloomingdale's. [20814016] |Tokyu, however, said no agreement had been reached. [20814017] |Nor is Tokyu the only Japanese retailer interested in Bloomingdale's, which bankers in Tokyo estimate could cost between $1 billion and $1.5 billion. [20814018] |Seven Japanese department-store groups were approached by investment bankers representing Bloomingdale's chairman, Marvin Traub, and more than half are seeking additional information on the group, bankers say. [20814019] |What Mr. Traub is hoping to put together, investment bankers say, is a management-led group to buy the New York department-store group that he heads from Campeau's Federated Department Stores subsidiary. [20814020] |Federated ran into a cash crunch after it was acquired last year by Campeau, which relied heavily on debt to finance the transaction. [20814021] |Paying off that debt put such a squeeze on Campeau and its stores that Federated decided to sell off the jewels of its retailing empire, including Bloomingdale's. [20814022] |Hoping to avoid another takeover, Mr. Traub retained Blackstone Group and Drexel Burnham Lambert Inc. to help him find partners for a management-led buy-out. [20814023] |Ideally, investment bankers say, he wants to get backing from a Japanese department store and a European department store to forge a global retailing network. [20814024] |"When you look at the economics, Traub needs a Japanese and a European partner to make it work," says one investment banker who follows the retail industry. [20814025] |"Looking only at a narrow American strategy isn't where it's at." [20814026] |Persuading tradition-bound Japanese retailers to get involved in the turmoils of the U.S. retailing industry isn't likely to be so easy, analysts say. [20814027] |Up until now, most stores have followed the same basic overseas strategy: [20814028] |First they set up overseas merchandising offices to import items and track new fashion trends. [20814029] |Then they opened small gift shops mostly aimed at Japanese tourists. [20814030] |Reluctant to advance further on their own, some stores have settled for tie-ups with famous specialty shops. [20814031] |Last March, Isetan invested 1.5 billion yen ($10.6 million) in a venture with Barney's Inc., an up-scale New York specialty clothier. [20814032] |The first Barney's shop is scheduled to open in Japan next year. [20814033] |And Mitsukoshi recently increased its equity stake in Tiffany & Co. to 13%. [20814034] |Through the longstanding relationship between the two companies, Mitsukoshi has opened 22 Tiffany shops in its stores and arcades in Japan. [20814035] |Plans are under way to open a Tiffany's in Hawaii to cater to Japanese tourists; it will be run mostly by Mitsukoshi. [20814036] |Some industry observers say that Mitsukoshi's classy image makes it a possible match for Saks Fifth Avenue. [20814037] |Company officials say they are studying various proposals but won't discuss details. [20814038] |Takashimaya Co., Japan's oldest department store, is another name that keeps popping up as a potential fit with Saks. [20814039] |Eiji Nakazato, a Takashimaya general manager, admits that his company's image is similar to Saks's and that there is some interest in the idea. [20814040] |But he stops there. [20814041] |"We'd like to do business in America," he says. [20814042] |"But it looks tough." [20814043] |Marcus W. Brauchli contributed to this article. [20814044] |Compiled by William Mathewson [20814045] |The Vatican was in the red last year. [20814046] |It said the regular 1988 deficit amounted to $43.5 million, based on revenue of $74.4 million and expenses of $117.9 million. [20814047] |But it said extraordinary expenditures for its radio station and restoration of buildings increased the deficit to $57.2 million. [20814048] |A statement from the council of cardinals said Catholics had responded generously to an appeal last year to give more money after 1987's record $63 million deficit. [20814049] |The statement said a 5% jump in the "Peter's Pence" collection -- the annual offering from Catholics to the pope -- helped cover the deficit. [20814050] |Council member Cardinal Gerald Carter of Toronto told Vatican Radio: "Now that we say we covered our deficit this year, people are going to relax and say well that's fine, the Holy See is out of the hole. [20814051] |But we're . . . going to be in the exact same situation next year." [20814052] |Former President Richard Nixon is to visit China at the invitation of the government beginning Saturday, the Foreign Ministry announced. [20814053] |According to Mr. Nixon's office, "This is solely a fact-finding trip. [20814054] |There will be no sightseeing, no shopping and no social events." [20814055] |Mr. Nixon's office said the former president "expects to have one-on-one discussions with the major Chinese leaders" and will give his assessment of those leaders to President Bush upon his return. [20814056] |A poll conducted in 12 of 16 NATO countries shows that the Dutch appear to be the strongest supporters of the alliance. [20814057] |The poll, conducted for the Dutch daily De Telegraaf by Gallup International said 81% of Dutch people supported NATO. [20814058] |Canada was the second most pro-NATO country with 78% supporting the alliance, followed by the U.S. with 75%, Britain with 71%, Belgium with 69% and West Germany with 63%. [20814059] |All other countries registered support below 50%. [20814060] |The Israeli Manufacturers' Association filed a police complaint against an Arab pasta maker for using the four colors of the outlawed Palestinian flag on spaghetti packages. [20814061] |"We asked police to investigate why they are allowed to distribute the flag in this way. [20814062] |It should be considered against the law," said Danny Leish, a spokesman for the association. [20814063] |The spaghetti is made by the Al Ghazel Macaroni Co. in Bethlehem and is marketed in a package decorated with green, black, red and white stripes. [20814064] |British postal authorities say they have uncovered a large-scale scheme where unscrupulous stamp dealers chemically removed stamp cancellations, regummed the stamps and sold them to U.S. collectors or, in large lots, to British businesses. [20814065] |The scheme allegedly cost the post office #10 million ($16.1) in revenue in the past 12 months. [20814066] |Dealers bought the used stamps cheaply from charities, including the Guide Dogs for the Blind Association. [20814067] |The charities regularly sell used stamps, which they collect from children and other donors, to raise funds. [20814068] |Akio Tanii, president of Japan's Matsushita Electric Industrial Co., presented the U.S. consul general in Osaka with a $1 million check to help San Francisco's earthquake victims. [20814069] |The company's U.S. subsidiary, Matsushita Electric Corp. of America, had donated over $35,000 worth of Matsushita-made flashlights and batteries to residents shortly after the disaster, a company spokesman said. [20814070] |Several other Japanese companies and regional governments have sent aid to San Francisco. [20814071] |Sumitomo Bank donated $500,000, Tokyo prefecture $15,000 and the city of Osaka $10,000. [20814072] |Chinese officials are trying to use the Canton Trade Fair to lure back overseas traders after the bloody crackdown on dissent. [20814073] |But attendance is down from previous years. [20814074] |What's more, a Hong Kong textile trader says, some Chinese exporters from state-run enterprises are protesting the crackdown by dragging their feet on soliciting new business. [20814075] |"They are angry about the government . . . so they hold back the goods," he said. [20814076] |This autumn's edition of the biannual fair will run through Oct. 31. [20814077] |Inside the 156,000-square-yard glass exhibition complex, products ranging from clothing to AK-47 machine guns are on display. [20814078] |Fair officials say that 21,000 guests visited during the first five days, a 10% drop from the spring exhibition. [20814079] |But China's official Xinhua News Agency reported that the number of foreign businessmen was greater than the previous fair -- without providing statistics. [20814080] |In another sign of glasnost, Alexander Solzhenitsyn's long-banned chronicle of Soviet repression, "The Gulag Archipelago," is now recommended reading in one 11th-grade Moscow history class. . . . [20814081] |British customs officers said they'd arrested eight men sneaking 111 rare snakes into Britain -- including one man who strapped a pair of boa constrictors under his armpits. [20814082] |A customs official said the arrests followed a "Snake Day" at Utrecht University in the Netherlands, an event used by some collectors as an opportunity to obtain rare snakes. [20815001] |Di Giorgio Corp. said it's continuing talks with potential buyers of certain units, but has reached no agreement on any deals. [20815002] |Di Giorgio, a food wholesaler and building products maker, is seeking alternatives to an unsolicited $32-a-share tender offer of DIG Acquisition Corp., a unit of Rose Partners Limited Partnership. [20815003] |DIG is the vehicle being used to pursue to acquisition. [20815004] |Robert Mellor, Di Giorgio's executive vice president, said the company stands to reap more money through the sale of individual units to others than by accepting DIG's offer. [20816001] |Some lousy earnings reports whacked the stock market, but bond prices fell only slightly and the dollar rose a little against most major currencies. [20816002] |The Dow Jones Industrial Average tumbled 39.55 points, to 2613.73, in active trading. [20816003] |Long-term Treasury bonds ended slightly higher. [20816004] |The dollar rose modestly against the mark and the yen, but soared against the pound following the resignation of Britain's chancellor of the Exchequer, Nigel Lawson. [20816005] |Analysts have complained that third-quarter corporate earnings haven't been very good, but the effect hit home particularly hard yesterday. [20816006] |Compaq Computer nose-dived $8.625 a share, to $100, and pulled other technology issues lower after reporting lower-than-expected earnings after the stock market closed Wednesday. [20816007] |Later yesterday the nation's major auto makers added to the gloom when they each reported their core auto operations were net losers in the third quarter. [20816008] |The less-than-robust third-quarter results came amid renewed concern about the volatility of stock prices and the role of computer-aided program trading. [20816009] |Taken together, the worries prompted a broad sell-off of stocks. [20816010] |The number of stocks on the New York Stock Exchange that fell in price yesterday exceeded 1,000, a key measure of underlying sentiment among technical analysts. [20816011] |Although the government said the economy grew an estimated 2.5% in the third quarter, in line with expectations, analysts are increasingly predicting much more sluggish growth -- and therefore more corporate earnings disappointments -- for the fourth quarter. [20816012] |"There are a lot more downward revisions of earnings forecasts than upward revisions," said Abby Joseph Cohen, a market strategist at Drexel Burnham Lambert. [20816013] |"People are questioning corporate profits as a pillar of support for the equity market." [20816014] |The bond market was unmoved by the economic statistics. [20816015] |While bond investors would have preferred growth to be a little slower, they were cheered by inflation measures in the data that showed prices rising at a modest annual rate of 2.9%. [20816016] |That is another small encouragement for the Federal Reserve to lower interest rates in coming weeks, they reasoned. [20816017] |In major market activity: [20816018] |Stock prices fell sharply in active trading. [20816019] |Volume on the New York Stock Exchange totaled 175.2 million shares. [20816020] |Declining issues on the Big Board outstripped gainers 1,141 to 406. [20816021] |Bond prices were barely higher. [20816022] |The Treasury's benchmark 30-year rose fractionally. [20816023] |Yield on the issue was 7.88%. [20816024] |The dollar rose modestly against most major currencies. [20816025] |In late New York trading the dollar was at 1.8400 marks and 142.10 yen compared with 1.8353 marks and 141.52 yen Wednesday. [20816026] |The dollar soared against the pound, which was at $1.5765 compared with $1.6145 Wednesday. [20817001] |The House joined the Senate in making federal reparations for Japanese-Americans held in World War II internment camps a legal entitlement requiring the Treasury Department to meet expedited payments of an estimated $1.25 billion during the next several years. [20817002] |The 249-166 roll call came as the chamber approved a compromise bill allocating $17.2 billion to the departments of State, Justice, and Commerce in fiscal 1990 and imposing increased fees on business interests making filings with the government. [20817003] |An estimated $40 million would come annually from a new $20,000 charge on pre-merger notifications to the Justice Department, and Securities and Exchange Commission filing fees would rise by 25% to fund a $26 million increase in the agency's budget. [20817004] |Yesterday's vote on Japanese-American reparations ensures final enactment of the entitlement provision, which abandons earlier efforts to find offsetting cuts but is seen as a more realistic path to expediting compensation first authorized in 1988. [20817005] |"The only way to reduce the costs is to say we don't want to pay the bill," said Rep. Neal Smith (D., Iowa), who taunted President Bush's party to back up his campaign promise of supporting the claims of $20,000 per individual. [20817006] |"Read my lips," said Mr. Smith. [20817007] |"If you're for paying the claims . . . I don't know how anyone can oppose this." [20817008] |No payments would be made this year, but beginning in fiscal 1991, the bill commits the government to annual payments of as much as $500 million until the total liability of $1.25 billion is met. [20817009] |The issue has assumed some of the character of past civil-rights debates and reopens old regional divisions in the Democratic majority. [20817010] |As much as Republicans led the opposition, among the 53 Democrats voting against treating the payments as an entitlement, 42 came from the 13 states in the Old Dixiecrat South and its borders. [20817011] |The odd mix of departments in the underlying bill makes it one of the more eclectic of the annual appropriations measures, and it is a lightning rod for a running battle over the fate of the Legal Services Corp. [20817012] |The measure provides $321 million to maintain services but would sharply curb the power of the current board until successors are agreed to by the Bush administration. [20817013] |The conservative bent of the incumbent appointees, named by former President Reagan, has divided Republicans. [20817014] |And on back-to-back roll calls, 206-199 and 223-178, the Appropriations Committee leadership turned back efforts to weaken or strip the proposed restrictions first added by Sen. Warren Rudman (R., N.H.) [20817015] |The estimated $40 million from the new pre-merger notification fee would be divided between the Justice Department's Antitrust Division and the Federal Trade Commission, which both face serious cuts if the income isn't realized. [20817016] |The Federal Bureau of Investigation is slated to receive $30 million by charging for fingerprint services in civil cases, and the judiciary will rely on another $32 million from bankruptcy charges, including a 33% increase in the current filing fee. [20817017] |The $17.2 billion total for the bill doesn't include an estimated $1.2 billion in supplemental anti-drug funds approved by the House-Senate conference yesterday, and the rush of money is already provoking jealousy among states competing for assistance. [20817018] |The House agreed to defer for a year a scheduled 50% increase in the required state matching funds for law-enforcement grants but, by a 287-123 margin, the chamber stripped a Senate initiative to raise the minimum grant for smaller states, such as New Hampshire and Delaware, to $1.6 million from $500,000. [20817019] |Few are more powerful in the competition for funds than the appropriations committees themselves -- including the three authors of the Gramm-Rudman-Hollings deficit-reduction law. [20817020] |When a House-Senate conference on yesterday's bill rescinded $11.8 million in unexpended funds for a Fort Worth, Texas, economic development project backed by former Speaker James Wright, Sen. Phil Gramm (R., Texas) insisted last week that the money be preserved. [20817021] |The measure includes $2 million secured by Mr. Rudman for a marine-research project at the University of New Hampshire, and Sen. Ernest Hollings (D., S.C.) used his power to add $10 million for an advanced technology initiative in the Commerce Department. [20817022] |This was in addition to a more parochial $4.5 million authorization for a health center in South Carolina upheld by a 273-121 vote in the House last night. [20818001] |The Big Three U.S. auto makers posted losses in their core North American automotive businesses for the third quarter, and expectations of continued slow vehicle sales and price wars are casting a pall over the fourth period. [20818002] |The strongest sign of the Big Three's woes came from Ford Motor Co., which said it had a loss in its U.S. automotive business for the first time since 1982. [20818003] |Ford predicted fourth-quarter net income will fall below the year-earlier level, partly because of a likely $500 million charge from the sale of its steel operations. [20818004] |The bleak automotive results were offset by strong earnings from some non-automotive operations. [20818005] |Still, the combined profit of Ford, Chrysler Corp. and General Motors Corp. fell 44% to $1.02 billion from $1.83 billion a year earlier, excluding a one-time gain of $309 million at Chrysler from the sale of Mitsubishi Motors Corp. stock. [20818006] |The last time all three companies reported North American automotive losses was in the recession year of 1982. [20818007] |Yesterday's announcements helped spark a midday wave of program selling in the stock market. [20818008] |GM's common closed at $44.375 a share, down 50 cents, Ford fell 37.5 cents to end at $47.50, and Chrysler eased 37.5 cents to $22.25, all in New York Stock Exchange composite trading. [20818009] |The market's pessimism reflects the gloomy outlook in Detroit. [20818010] |As Japanese auto makers gained market share, the Big Three, with GM in the lead, slashed North American production and launched a retail discounting blitz. [20818011] |The price war peaked in the third quarter as Big Three factory discounts climbed to more than $1,000 a vehicle, according to industry officials. [20818012] |GM probably had the "heaviest incentives," said Robert S. Miller, Chrysler's chief financial officer. [20818013] |"We all did what we had to do to stay within sight of them." [20818014] |But the costly efforts did little to slow Japanese market gains, and domestic car sales have plunged 19% since the Big Three ended many of their programs Sept. 30. [20818015] |GM, Ford and Chrysler have already cut fourth-quarter U.S. output plans an estimated 15% from 1988 levels. [20818016] |If sales don't pick up, the cuts will go deeper and incentives will sprout again. [20818017] |Ford, which has long boasted of its ability to weather a downturn, saw earnings take a beating. [20818018] |The No. 2 auto maker blamed incentive costs and reduced production -- both the result of a substantially weaker U.S. market -- for a 44% drop in net to $477.1 million, or $1.03 a share, on revenue of $20.24 billion. [20818019] |Nearly all the decline came in Ford's U.S. automotive operations. [20818020] |The Dearborn, Mich., auto maker ran a loss of $37 million on assembling and marketing cars in the U.S., a deterioration of $378 million in that line from the 1988 quarter. [20818021] |Ford managed to show a profit for the quarter primarily because of earnings from overseas auto operations and financial services. [20818022] |A year earlier, Ford reported record net of $856.3 million, or $1.78 a share, on revenue of $20.38 billion. [20818023] |In the latest nine months, Ford earned $3.52 billion, or $7.51 a share, compared with $4.14 billion, or $8.53 a share. [20818024] |The U.S. automotive loss was a sharp reversal for a company that had reeled off 12 consecutive quarters of improved earnings until the 1989 second quarter. [20818025] |But David N. McCammon, vice president, finance, insisted that cost-cutting and tight production capacity will make results "better in this downturn than in prior downturns," when Ford had net losses. [20818026] |Still, Mr. McCammon said Ford expects the U.S. economy to weaken through the end of 1990, causing weaker sales and production. [20818027] |As a result, fourth-quarter profit will come in below 1988 results, although the drop won't be as sharp as the 44% third-quarter decline, he said. [20818028] |Part of the drop will come from an anticipated charge of as much as $500 million from the proposed sale of its Rouge Steel unit. [20818029] |In the 1988 fourth quarter, Ford had net of $1.16 billion, or $2.42 a share. [20818030] |Chrysler's operating profit fell to a scant $22 million, or 10 cents a share, its lowest quarterly total in seven years. [20818031] |Its $309 million, or $1.32 a share, gain from the sale of 75 million Mitsubishi shares made net $331 million, or $1.42 a share. [20818032] |Sales were flat at $7.88 billion. [20818033] |The results include record quarterly earnings of $76 million from Chrysler Financial Corp. [20818034] |A year earlier, Chrysler's net was $113 million, or 50 cents a share. [20818035] |Mr. Miller said costs of incentives caused a "moderate" loss in the Highland Park, Mich., company's North American car and truck business. [20818036] |He said the loss wasn't "that much different" from Ford's $37 million loss on U.S. automotive operations, but he declined to be specific. [20818037] |Mr. Miller said Chrysler spent an average of $1,000 a vehicle on its incentive programs in the third quarter, compared with about $450 a vehicle a year earlier -- a "high-water mark" at the time. [20818038] |He said Chrysler "is no longer sure" of its forecast for industry car and truck sales of 14.2 million in the 1990 model year. [20818039] |Consumers, he said, are balking at higher prices on 1990 cars, especially after seeing the incentive-reduced prices on 1989 models. [20818040] |In the nine months, net was $1.02 billion, or $4.38 a share, including the gain from the Mitsubishi stock sale, compared with $617 million, or $2.77 a share, after a charge of $93 million, or 42 cents a share, for plant closings in the 1988 period. [20818041] |Sales rose 8.4% to $27.95 billion from $25.78 billion. [20818042] |Heavy losses in North American auto operations sent GM's net tumbling to $516.9 million from a record $859.2 million. [20818043] |Detroit-based GM doesn't issue separate quarterly earnings for the North American automotive business. [20818044] |But analysts estimated that GM had a loss of as much as $300 million on domestic vehicle operations. [20818045] |An 8.5% drop in North American factory sales of cars and trucks cut into revenue, and rebates to dealers and customers more than offset gains from price increases on 1990 model vehicles delivered during the period, a GM spokesman said. [20818046] |But GM's results also illustrate the increasing diversity of its operations. [20818047] |In one breakdown, GM attributed half of its net to its two big technology units, Electronic Data Systems Corp. and GM Hughes Electronics Corp. [20818048] |Meanwhile, GM said overseas auto operations are on track to exceed last year's record full-year net of $2.7 billion. [20818049] |The diversified operations helped GM build its cash reserves, exclusive of its financial subsidiary, to $5.5 billion as of Sept. 30, a 22% increase from a year earlier. [20818050] |This cushion could come in handy if GM has to trim fourth-quarter North American production schedules more than the already scheduled 9.5%. [20818051] |Under the circumstances, it won't be easy for GM to exceed its record 1988 fourth-quarter net of $1.4 billion, the spokesman acknowledged. [20818052] |That means it's unlikely the company will surpass last year's $4.9 billion full-year profit, even though net for the first nine months was up 1.9% to $3.52 billion on revenue of $95.57 billion. [20818053] |It earned $3.46 billion on revenue of $91.21 billion in the 1988 nine months. [20819001] |There are two versions of "Measure for Measure" on stage at the Alley Theater here. [20819002] |One is a strong, vigorous portrayal of Shakespeare's play; the other is director Gregory Boyd's overlay of present-day punk rock decadence on old Vienna. [20819003] |"Measure for Measure" is one of Shakespeare's "problem" plays, so named because it does not fit neatly into a category such as tragedy, comedy or history. [20819004] |Its ambiguity and uneasy mixture of the serious and the comic is no doubt one reason why it is very much in vogue with directors just now. [20819005] |Last season, Hartford Stage director Mark Lamos mounted a production at Lincoln Center, and currently two other productions -- one just closed at the Old Globe in San Diego and another now at the Seattle Rep -- overlap with Mr. Boyd's. [20819006] |In the play, the Duke of Vienna despairs over the licentiousness of his subjects and turns over the rule of the city to the puritanical Angelo, hoping he can set things right. [20819007] |When Angelo hears that the young man Claudio has made his fiancee pregnant before he could marry her, Angelo summarily condemns Claudio to death. [20819008] |When, however, Claudio's sister, Isabella, a novitiate in a convent, goes to Angelo to plead her brother's case, the obdurate ruler immediately falls in love with her and, in a supreme act of hypocrisy, demands that Isabella yield up her virtue to him in exchange for her brother's life. [20819009] |Meanwhile, the Duke, who set the original scheme in motion, appears on the scene disguised as a friar and becomes involved in a series of intrigues that has everyone fearing the worst possible outcome until the Duke arranges a last minute reprieve for all concerned. [20819010] |For the Alley production, scene designer Peter David Gould has arranged a stark but extremely effective set featuring a rectangular platform of white-washed boards that extends into the audience. [20819011] |When the action requires, a prison cell, consisting of an enlarged wire cage, rolls forward on iron wheels on the platform. [20819012] |In the play's major scenes Mr. Boyd demonstrates that he has a firm grasp of the Shakespearean dynamic. [20819013] |When Isabella (Ellen Lauren) confronts her brother Claudio (Matt Loney) in his cell, explaining the price she has been asked to secure his freedom; when Isabella and the disguised Duke (Philip Kerr) conspire to trick Angelo; and when Mariana (Annalee Jefferies), a woman wronged by Angelo, confronts him with his past misdeeds, the performers bring the dramatic high points to life with intense energy and intelligence. [20819014] |At such moments Mr. Boyd makes it clear that he has the capacity to be a superior interpreter of Shakespeare. [20819015] |When, however, he decides to be modern, or more accurately, when he decides to be trendy, the results are far less satisfactory. [20819016] |Mr. Boyd is of the directorial school that believes one must find modern parallels or metaphors to make Shakespeare accessible to today's audiences. [20819017] |It's a valid approach, but it puts a heavy burden on the director to show an uncommon degree of imagination and taste. [20819018] |In his "Measure," Mr. Boyd has "modernized" the pimps and prostitutes of Vienna whom Angelo is supposed to bring under control by converting them into transvestites, punk rockers and heavy metal types, with a strong emphasis on leather, chains and porno-inspired costumes. [20819019] |Loud rock music accompanies all the scene changes, even those in the convent. [20819020] |When Claudio is arrested, he is brought on stage nude except for the manacles on his wrists and ankles. [20819021] |When the opportunist Lucio (Jack Stehlin) visits the convent to inform Isabella of her brother's fate, Lucio not only slaps the mother superior on her rear, but brings along a voluptuous companion (Jill Powell), not in Shakespeare's script, to undulate lasciviously. [20819022] |Meanwhile, the pimp Pompey (Glen Allen Pruett), dressed in black leather and a prominent codpiece, indulges in enough obscene gestures and pelvic thrusts to launch a space probe. [20819023] |The problem here is not in the concept but in its lack of discrimination. [20819024] |The inclusion at one point, for example, of a list of glitzy modern-day malefactors, ranging from Jim Bakker and Leona Helmsley to Zsa Zsa Gabor, is a bid for a cheap laugh unworthy of Mr. Boyd's ability. [20819025] |Despite the excesses, however, the scorecard for the production has many more pluses than minuses. [20819026] |What's more, it represents an important step for the Alley Theater. [20819027] |"Measure for Measure" is Mr. Boyd's first directorial assignment as the theater's new artistic director. [20819028] |He succeeded Pat Brown, who was fired by the Alley board 18 months ago. [20819029] |Her dismissal angered many in the regional theater establishment and led Peter Zeisler, head of Theatre Communications Group, to write an editorial in American Theatre magazine condemning the board. [20819030] |None of this backlash could change the fact that Ms. Brown's regime was remarkably undistinguished and unimaginative. [20819031] |Now the Alley has moved ahead on both artistic and financial fronts. [20819032] |Not only is Mr. Boyd giving the theater a new sense of adventure and excitement on stage, the balance sheet is the best the theater has had in 10 years. [20819033] |As opposed to the $1.4 million deficit of the 1987-88 season, the 1988-89 year concluded with a $200,000 surplus and a $500,000 cash reserve. [20819034] |Admittedly last season's runaway hit, "Steel Magnolias," helped a lot, but so did cost cutting and other measures insisted on by the board. [20819035] |Only time will tell if Mr. Boyd can restore to the Alley the acclaim it received when its founder, Nina Vance, was at the height of her powers. [20819036] |But it is clear he is going to give it a shot. [20820001] |Democratic leaders have bottled up President Bush's capital-gains tax cut in the Senate and may be able to prevent a vote on the issue indefinitely. [20820002] |Senate Majority Leader George Mitchell (D., Maine) said he intends to use Senate procedures to force advocates of the tax cut to come up with at least 60 votes before they can address the issue. [20820003] |And neither Democrats nor Republicans are predicting that the capital-gains forces can produce enough votes. [20820004] |"The 60-vote requirement will be there and they don't have the 60 votes," Sen. Mitchell said. [20820005] |"They don't have the votes to get it passed." [20820006] |Sen. Bob Packwood (R., Ore.), the leading Republican proponent of the tax cut, didn't disagree. [20820007] |"I'm not sure what's going to happen," he said. [20820008] |Previously he had said he would be able to find the requisite 60 votes eventually. [20820009] |Sen. Packwood has offered his capital-gains-cut package as an amendment to a bill, now pending in the Senate, that would authorize aid to Poland and Hungary. [20820010] |Democrats are holding up a vote on the amendment by threatening a filibuster, or extended debate. [20820011] |For a cloture vote to stop the filibuster, Republicans must muster at least 60 votes. [20820012] |Yesterday, Sen. Packwood acknowledged, "We don't have the votes for cloture today." [20820013] |The Republicans show no sign of relenting. [20820014] |GOP leaders continued to press for a vote on the amendment to the Eastern Europe aid measure. [20820015] |And they threatened to try to amend any other revenue bill in the Senate with the capital-gains provision. [20820016] |"This is serious business; we're serious about a capital-gains reduction," said Kansas Sen. Robert Dole, the Senate's Republican leader. [20820017] |"The strategy is `Let's vote. ' " [20820018] |The Republicans contend that they can garner a majority in the 100-member Senate for a capital-gains tax cut. [20820019] |They accuse the Democrats of unfairly using Senate rules to erect a 60-vote hurdle. [20820020] |Democrats counter that the Republicans have often used the same rules to suit their own ends. [20820021] |The two sides also traded accusations about the cost of the Packwood plan. [20820022] |Democrats asserted that the proposal, which also would create a new type of individual retirement account, was fraught with budget gimmickry that would lose billions of dollars in the long run. [20820023] |Republicans countered that long-range revenue estimates were unreliable. [20820024] |The Packwood proposal would reduce the tax depending on how long an asset was held. [20820025] |It also would create a new IRA that would shield from taxation the appreciation on investments made for a wide variety of purposes, including retirement, medical expenses, first-home purchases and tuition. [20820026] |A White House spokesman said President Bush is "generally supportive" of the Packwood plan.