YEAR IN REVIEW 1999: NOBEL-PRIZES

Prize for Chemistry "As we approach the end of the 1990s, we are seeing the result of an enormous theoretical and computational development, and the consequences are revolutionizing the whole of chemistry." So stated the Royal Swedish Academy of Sciences in its award of the 1998 Nobel Prize for Chemistry to "the two most prominent figures in this process," Walter Kohn and John A. Pople. Kohn, a British citizen and a physicist at the University of California, Santa Barbara, and Pople, an Austrian-born U.S. mathematical chemist at Northwestern University, Evanston, Ill., were widely acknowledged pioneers in devising computational methods to study the properties of interactions of molecules. The development of quantum mechanics in physics in the early 1900s offered chemists the potential for a deep new mathematical understanding of their science. Nevertheless, describing the quantum mechanics of large molecules, which are very complex systems, involved what appeared to be impossibly difficult computations. Chemists remained stymied until the 1960s, when computers for solving these complex equations became available. Quantum chemistry, the application of quantum mechanics to chemical problems, emerged as a new branch of chemistry. "Quantum chemistry is used nowadays in practically all branches of chemistry, always with the aim of increasing our knowledge of the inner structure of matter," the Swedish Academy said. "The scientific work of Walter Kohn and John Pople has been crucial for the development of this new field of research." Kohn and Pople made contributions as closely related as the two faces of a coin. The Swedish Academy cited Kohn for development of the density-functional theory in the 1960s. It simplified the mathematical description of bonding between atoms that make up molecules. Pople was cited for having developed computational methods, based on quantum mechanics, which he packaged in 1970 in the computer program Gaussian. Gaussian later became the basic tool used by thousands of scientists worldwide for modeling and studying molecules and chemical reactions. Before Kohn's and Pople's work, chemists thought that a description of the quantum mechanics of molecules required precise knowledge of the motion of every electron in every atom in a molecule. In 1964 Kohn showed that it is sufficient only to know the average number of electrons at any one point in space--i.e., the electron density. For determining that information Kohn introduced a computational method that became known as the density-functional theory. Years of additional research, however, were needed before chemists were able to apply the theory to large-scale studies of molecules. By the late 1990s the theory had become widely used as the basis for solving many problems in chemistry--for example, calculating the geometrical structure of large molecules such as enzymes and mapping the course of chemical reactions. Pople's research in the 1960s led to the discovery of a new approach for analyzing the electronic structure of molecules, based on the fundamental laws of quantum mechanics. He put the approach, called theoretical model chemistry, into a computer program that allowed chemists to create computer models of chemical reactions that were difficult or impossible to run in a laboratory. One use of such information was, in the development of new drugs, to determine how a molecule would react inside the body. In the early 1990s Pople incorporated Kohn's density-functional theory into the program, making possible the analysis of more complex molecules. The original program, Gaussian 70, was updated and improved over the years. Its commercial version, marketed by Gaussian Inc., Pittsburgh, Pa., was one of the most widely used quantum chemistry programs. Kohn was born on March 9, 1923, in Vienna and received a Ph.D. in physics from Harvard University in 1948. He developed his density-functional theory while at the University of California, San Diego (1960-79). In 1979 he became founding director of the Institute for Theoretical Physics at the University of California, Santa Barbara, where he later served as a professor (1984-91). Pople was born in Burnham-on-Sea, Somerset, Eng., on Oct. 31, 1925. He received a Ph.D. in mathematics in 1951 from the University of Cambridge. He became a professor at Carnegie Mellon University, Pittsburgh, in 1964 and a professor at Northwestern in 1993. MICHAEL WOODS Prize for Economics Amartya Sen was awarded the 1998 Nobel Memorial Prize in Economic Science for his contributions to welfare economics and social choice and for his interest in the problems of society's poorest members. Sen was best known for his work on the causes of famine, which led to the development of practical solutions for preventing or limiting the effects of real or perceived shortages of food. The Royal Swedish Academy of Sciences noted that Sen's work "restored an ethical dimension to the discussion of vital economic problems." In recognizing his work on the social underpinnings of economics, the Nobel Committee broke with its tradition of the previous few years of awarding its prize to those researchers, most of them conservative, working in the field of market economics. Welfare economics is the branch of economics that seeks to evaluate economic policies in terms of their effects on the well-being of the community. Sen, who devoted his career to such issues, had been called the "conscience of his profession." His influential monograph Collective Choice and Social Welfare (1970), which addressed problems such as individual rights, majority rule, and the availability of information about individual conditions, inspired many researchers to turn their attention to issues of basic welfare. Sen devised methods of measuring poverty that yielded information useful to improving economic conditions for the poor. His theoretical work on inequality provided an explanation for why there are fewer women than men in some poor countries in spite of the fact that more women than men are born and infant mortality is higher among males. Sen claimed that this skewed ratio results from the better health treatment and childhood opportunities afforded boys in those countries. Sen's interest in famine stemmed from personal experience. As a nine-year-old boy, he witnessed the Bengal famine of 1943, in which three million people perished. This staggering loss of lives was unnecessary, Sen concluded, given that there was, he believed, an adequate food supply in India at the time. Its distribution was hindered, however, because particular groups of people--in this case rural labourers--lost their jobs and therefore their ability to purchase food. In his book Poverty and Famines: An Essay on Entitlement and Deprivation (1981), Sen revealed that in many cases of famine, food supplies were not significantly reduced. Instead, a number of social and economic factors, such as declining wages, unemployment, rising food prices, and poor food-distribution systems, led to starvation in certain groups in society. Governments and international organizations handling food crises were influenced by Sen's work. His views encouraged policy makers to pay attention not only to alleviating immediate suffering but also to finding ways to replace the lost income of the poor, as, for example, through public-works projects, and to maintain stable prices for food. A vigorous defender of political freedom, Sen believed that famines do not occur in functioning democracies because their leaders must be more responsive to the demands of the citizens. In order for economic growth to be achieved, he argued, social reforms, such as improvements in education and public health, must precede economic reform. Sen was born in Santiniketan, Bengal, India, on Nov. 3, 1933, and was educated at Presidency College in Calcutta. He went on to study at Trinity College, Cambridge, where he received his B.A. (1955), M.A. (1959), and Ph.D. (1959). While at Trinity he was awarded the Adam Smith Prize (1954), the Wrenbury Scholarship (1955), and the Stevenson Prize (1956). He taught economics at a number of universities in India and England, including the Universities of Jadavpur (1956-58) and Delhi (1963-71), the London School of Economics, the University of London (1971-77), and the University of Oxford (1977-88), before moving to Harvard University (1988-98), where he was professor of economics and philosophy. In 1998 he was appointed to his current position as master of Trinity College, Cambridge. Sen was the sixth Indian to win a Nobel Prize and the first to be awarded the economics prize. MARY JANE FRIEDRICH Prize for Literature Although Portuguese author Jos Saramago did not begin writing in earnest until his mid-50s, some critics believed that his reception of the 1998 Nobel Prize for Literature was long overdue. Heralded as an achievement for the language and culture of Portugal, it was only the second Nobel awarded to a Portuguese (neurologist Antnio Egas Moniz won the 1949 Prize for Physiology or Medicine). Saramago came of age as a writer in the 1980s with a series of inventive, multilayered novels that ruminated on human fate and foibles. Often presented as allegory, his stories balanced the gravity of his political skepticism and historical knowledge with the lightness of magic realism, experimental grammar, and compassion for his characters. In addition to authoring 10 best-selling novels, Saramago wrote poetry, plays, short stories, and essays. Saramago first earned international fame at age 60 with Memorial do convento (1982; published in the U.S. as Baltasar and Blimunda, 1987), widely considered his finest novel. Set in the early 18th century during the Inquisition, it was an intricate historical fantasy about a romance between war veteran Baltasar and clairvoyant Blimunda, who with the help of an adventurous priest, build a flying machine powered by human will. Central to the plot was the epic construction of the Convent of Mathra (1717-35), outside Lisbon. Saramago adapted the novel into a libretto for the opera Blimunda (1990), with a score by Italian composer Azio Corghi. The novel's satire was unflinching in its litany of class differences between the haves and the have-nots: The heat is unbearable and the spectators refresh themselves with the customary glass of lemonade, cup of water or slice of water-melon, for there is no reason why they should suffer from heat prostration just because the condemned are about to die. And should they feel peckish, there is a wide choice of nuts and seeds, cheeses and dates. The King, with his inseparable Infantes and Infantas, will dine at the Headquarters of the Inquisition as soon as the auto-da-f has ended. Once free of the wretched business, he will join the Chief Inquisitor for a sumptuous feast laden with bowls of chicken broth, partridges, breasts of veal, pts and meat savouries flavored with cinnamon and sugar, a stew in the Castilian manner with all the appropriate ingredients and saffron rice, blancmanges, pastries, and fruits in season. Saramago was born on Nov. 16, 1922, into a farming family in the village of Azinhaga, Ribatejo province. He left high school early to begin work, eventually entering publishing as a journalist and editor, though he wrote little on his own. Stifled by the repressive cultural atmosphere during the dictatorship of Antnio de Oliveira Salazar, Saramago joined the Communist Party in 1969, but, following the revolution of April 1974, an anticommunist backlash forced him from his job at the newspaper. At that time he began writing. In 1977 he published his first novel, Manual de pintura e caligrafia (1976; Manual of Painting and Calligraphy, 1994), about an idealistic portrait painter who makes sacrifices to defend his integrity as an artist and a critic. His themes turned to politics in a collection of short stories, Objecto Quase (1978) and the follow-up novel Levantado do cho (1980), set during the Salazar regime. In 1986, as Spain and Portugal were joining the European Community, Saramago published A jangada de pedra (1986; The Stone Raft, 1994-95), a surreal tale of the Iberian peninsula physically breaking apart from Europe and floating out into the Atlantic Ocean; chaos reigns until a band of ordinary citizens takes control. When a proofreader inserts the word "not" into a sentence of a book about Portugal, history is literally rewritten in A histria do cerco de Lisboa (1989; The History of the Siege of Lisbon, 1996), one of the author's most contemplative works. O evangelho segundo Jesus Cristo (1991; The Gospel According to Jesus Christ, 1994) raised some hackles in its well-crafted depiction of an earthy Jesus set in conflict with a ruthless God. After moving to the Canary Islands, Saramago wrote Ensaio sobre a cegueira (1995; Blindness, 1998), a sharp-edged social commentary about how an epidemic of blindness speeds civilization toward self-destruction. His most recent novel, Todos os nomes, was published in 1997. TOM MICHAEL Prize for Peace In October 1998 the Norwegian Nobel Committee awarded its Nobel Prize for Peace to the two architects of the peace agreement that had been signed on April 10, 1998, in Northern Ireland--John Hume, the Roman Catholic leader of the nationalist Social Democratic and Labour Party (SDLP), and David Trimble, the Protestant leader of the Ulster Unionist Party (UUP). Thirty years of violence, short-lived cease-fires, and spasmodic secret negotiations had given way to a deal that held out the hope of sustained peace for the troubled British province. For most of those 30 years, Hume and Trimble had been enemies; eventually, however, they came to trust each other and ended up sharing the same platform as they campaigned for peace--something that would have been inconceivable for most of their political lives. Hume, who was born Jan. 18, 1937, was brought up in poverty in Londonderry. He trained to be a priest but was attracted to politics by the civil rights movement in the late 1960s, when Northern Ireland's Catholic minority adopted the nonviolent tactics of the U.S. civil rights movement to protest against the discriminatory policies of the (mainly Protestant) Unionist rulers of the province. The violent suppression of this movement provoked hard-line nationalists to revive the Irish Republican Army (IRA). Hume, believing always in only peaceful and constitutional action, joined the SDLP; in 1973 he served briefly as commerce minister in the short-lived power-sharing assembly that was headed by the leader of the UUP and that collapsed in 1974. Five years later Hume became leader of the SDLP. In 1988, after 20 years of violence and with no end in sight, Hume took an enormous risk by opening a private dialogue with Gerry Adams, leader of Sinn Fein--the political wing of the IRA and the bitter rival of the SDLP in the contest to win the support of Northern Ireland's nationalist voters. Hume was frequently attacked by members of his own party for speaking to "the men of violence," but he persisted, believing that peace would come only when Adams could be persuaded to end the IRA's armed struggle--and when Adams could in turn persuade the rest of Sinn Fein and the IRA. Trimble's trajectory toward peace was rather different. Born Oct. 15, 1944, into a middle-class Belfast family, he first ventured into politics in 1973 when he joined the Vanguard Party, which was established following the abolition of Northern Ireland's provincial parliament at Stormont. The party provided more militant opposition to British direct rule than that offered by the official UUP. As an active member of Vanguard, Trimble supported the strikes by Protestant workers that brought down the power-sharing assembly in which Hume had served. In the mid-1970s Vanguard split, and Trimble, as part of its relatively moderate faction, joined the UUP. His opposition to any concession to Irish nationalism persisted, however; in 1985 he joined a newly formed organization, Ulster Clubs, which was dedicated to militant tactics to derail the 1985 Anglo-Irish accord designed to bring peace to the province. When the IRA called a cease-fire in 1994, Trimble opposed negotiations with Sinn Fein and warned his party not to make concessions to terrorism. In 1995 his record as a hard-liner helped him win a surprise victory in the contest to succeed James Molyneaux as leader of the UUP. Once elected leader, however, he proved to be more thoughtful and less strident than expected. He agreed to take part in peace talks chaired by former U.S. senator George Mitchell. The talks--which progressed slowly, primarily because the IRA in February 1996 had resumed violent struggle before agreeing to a "permanent" cease-fire in July 1997--embraced every political group in Northern Ireland, from Sinn Fein to the Protestant paramilitary groups and to the British and Irish governments. It was the dialogue between Hume and Trimble that was crucial, however. In the end, both men had enough credit with the more militant members of their communities to deliver the compromises that were inevitable to secure the agreement that became known as the "Good Friday" peace pact. PETER KELLNER Prize for Physics The 1998 Nobel Prize for Physics was awarded to three scientists, a German and two Americans, who discovered that electrons in semiconductors placed in very strong magnetic fields at extremely low temperatures demonstrate bizarre behaviour. Under such conditions electrons condense to form a quantum fluid similar to the quantum fluids that occur in superconductivity and liquid helium. Electrons in the fluid act, seemingly impossibly, as if they have only a fraction of a whole electron charge. "What makes these fluids particularly important for researchers is that events in a drop of quantum fluid can afford more profound insights into the general inner structure and dynamics of matter," stated the Royal Swedish Academy of Sciences in its prize announcement. "The contributions of the three laureates have thus led to yet another breakthrough in our understanding of quantum physics and to the development of new theoretical concepts of significance in many branches of modern physics." The prize was shared by Horst L. Strmer of Columbia University, New York City, Daniel C. Tsui of Princeton University, and Robert B. Laughlin of Stanford University. Strmer was born on April 6, 1949, in Frankfurt am Main, Ger., and received a Ph.D. in physics in 1977 from the University of Stuttgart. Tsui, a naturalized U.S. citizen, was born in Henan, China, on Feb. 28, 1939, and earned a Ph.D. in physics in 1967 from the University of Chicago. Laughlin, born on Nov. 1, 1950, in Visalia, Calif., received his Ph.D. in physics in 1979 from the Massachusetts Institute of Technology. Strmer and Tsui were cited for the discovery in 1982 of a new aspect of a phenomenon first demonstrated in an 1879 experiment by Edwin H. Hall, a U.S. physicist. Hall found that when a conductor carrying an electric current is placed in a magnetic field that is perpendicular to the current flow, an electric field is created that is perpendicular to both the current and the magnetic field. This phenomenon, called the Hall effect, occurs because the magnetic field deflects the flow of electrons toward one side of the current-carrying material. The electric field gives rise to a voltage, called the Hall voltage, and the ratio of this voltage to the current is called the Hall resistance. The Hall effect, which occurs in both conductors and semiconductors, later became a standard measurement tool in physics laboratories around the world. In 1980 the German physicist Klaus von Klitzing discovered a variation of the Hall effect, which came to be called the integer quantum Hall effect. For moderate applied magnetic fields, the Hall resistance changes smoothly with changes in the strength of the field. Klitzing, however, used high-magnetic fields and temperatures near absolute zero to study the Hall effect in a semiconductor device in which electron motion was confined to two dimensions. Under those conditions he found that varying the magnetic field causes the Hall resistance to change not smoothly but rather in discrete steps, a behaviour physicists described as being quantized. Klitzing won the 1985 Nobel Prize for Physics for his work. In 1982 Strmer and Tsui, then at Bell Laboratories, Murray Hill, N.J., carried out a similar experiment using even lower temperatures and stronger fields. To their surprise they found more steps in the Hall resistance, some of them lying between Klitzing's integer steps. Whereas the integer quantum Hall effect could be understood in terms of the behaviour of individual electrons, the new effect suggested that the involved particles had fractional electric charges--one-third, one-fifth, or one-seventh that of an electron. The finding mystified and excited physicists, who searched for an explanation. A year later Laughlin, at Bell Labs and then Lawrence Livermore National Laboratory, Livermore, Calif., in the early 1980s, solved the mystery with a theoretical explanation. He proposed that the low temperature and intense magnetic field made the electrons condense into a new kind of quantum fluid. Earlier researchers had observed other quantum fluids at very low temperatures in liquid helium and in superconductor materials. Laughlin's quantum fluid exhibited many bizarre properties, including one in which the participating electrons behaved as fractionally charged "quasiparticles." Laughlin showed that such quasiparticles had exactly the right electric charges to explain Strmer and Tsui's findings. The Swedish Academy stated that the laureates' work in 1982-83 represented "an indirect demonstration of the new quantum fluid and its fractionally charged quasiparticles." Verification came only in the late 1990s thanks to "astonishing developments in microelectronics" that made it possible to obtain more direct evidence for the existence of quasiparticles. MICHAEL WOODS Prize for Physiology or Medicine Three American scientists, Robert F. Furchgott of the State University of New York (SUNY) Health Science Center in Brooklyn, Ferid Murad of the University of Texas Medical School in Houston, and Louis J. Ignarro of the University of California School of Medicine in Los Angeles, won the 1998 Nobel Prize for Physiology or Medicine for discovering that a gas, nitric oxide (NO), acts as a signaling molecule in the cardiovascular system. Their work, the bulk of which was performed in the 1980s, uncovered an entirely new mechanism for how blood vessels in the body relax and widen. It led to the development of the anti-impotence drug Viagra (see HEALTH AND DISEASE: Sidebar) and potential new approaches for understanding and treating other diseases. The Nobel Assembly of the Karolinska Institute in Stockholm, which presented the prize, said that the identification of a biological role for NO was surprising for several reasons. Nitric oxide was known mainly as a harmful air pollutant, released into the atmosphere from automobile engines and other combustion sources. In addition, it was a simple molecule, very different from the complex neurotransmitters and other signaling molecules that regulate many biological events. No other known gas acts as a signaling molecule in the body. Nitric oxide's role began to emerge in the 1970s and '80s. In 1977 Murad, then at the University of Virginia, showed that nitroglycerin and several related heart drugs induce the formation of NO and that the colourless, odourless gas acts to increase the diameter of blood vessels in the body. Murad was born on Sept. 14, 1936, in Whiting, Ind., and received his M.D. and Ph.D. degrees from Western Reserve University (later Case Western Reserve University), Cleveland, Ohio, in 1965. Murad was also cited by the committee for work that he accomplished at Stanford University in the 1980s and later at Abbott Laboratories in Illinois. Around 1980 Furchgott, in an ingenious experiment, demonstrated that cells in the endothelium, or inner lining, of blood vessels produce an unknown signaling molecule. The molecule, which he named endothelium-derived relaxing factor (EDRF), signals smooth muscle cells in blood vessel walls to relax, dilating the vessels. Furchgott was born on June 4, 1916, in Charleston, S.C. In 1940 he earned a Ph.D. in biochemistry from Northwestern University, Evanston, Ill., and he joined SUNY-Brooklyn's Department of Pharmacology in 1956. The Nobel Committee cited Ignarro for "a brilliant series of analyses" that demonstrated that EDRF was nitric oxide. Ignarro's research, conducted in 1986, was done independently of Furchgott's own work to identify EDRF. It was the first discovery that a gas could act as a signaling molecule in a living organism. Ignarro, who was born on May 31, 1941, in Brooklyn, gained a Ph.D. in pharmacology from the University of Minnesota. Before making his significant discovery at UCLA, he was professor of pharmacology (1979-85) at Tulane University's School of Medicine, New Orleans. Furchgott and Ignarro first announced their findings at a scientific conference in 1986 and triggered an international boom in research on nitric oxide. Scientists later showed that NO is manufactured by many different kinds of cells in the body and has a role in regulating a variety of body functions. The Nobel Assembly said that the scientists' research was key to the development of the highly successful drug Viagra, which acts to increase NO's effect in penile blood vessels. Researchers expected that other medical applications of knowledge about NO would come in treating heart disease, shock, and cancer. Tests that analyze production of NO also could improve the diagnosis of lung diseases such as asthma and intestinal disorders such as colitis. The Nobel Assembly cited one irony about the award. When Alfred Nobel, inventor of dynamite, became ill with heart disease, his physicians advised him to take nitroglycerin. Dynamite consists of nitroglycerin absorbed in a material called kieselguhr, which makes nitroglycerin less likely to explode accidentally. Nobel, however, refused, unable to understand how the explosive could relieve chest pain. It took science 100 years to find the answer in NO, the Assembly said. MICHAEL WOODS Social Protection North America. A booming economy and election-year sensitivities shifted the focus of social protection activity in the United States from legislation to debate in 1998. The chief issue was the financial stability of Social Security, which provided retirement, disability, and survivors' benefits to more than 44 million Americans. The system collected about $100 billion a year more in payroll taxes than it paid out in benefits, but concern had been growing about what would happen when 77 million baby boomers started to retire after 2010. The percentage of Americans 65 and older, about 12.7% of the population in 1998, was expected to rise to 20.7% by 2050, and the ratio of workers to retirees, now 3-1, would shrink to 2-1. Some thought that the system would start running a deficit beginning in 2029, but the Social Security trustees reported that, owing to the strong economy, the problem would be deferred until 2032. In his state of the union message, U.S. Pres. Bill Clinton said that the U.S. had to "save Social Security first" and called on Congress to use budget surpluses to shore up the system's trust fund. The White House led a national dialogue, with a series of "town hall" forums across the country, to discuss ideas for rescuing the largest U.S. social welfare program. Plans centred on four strategies: (1) increasing payroll taxes, which were 12.4%, split equally between workers and employers, on salaries up to a maximum of $72,600 annually; (2) raising the retirement age, which was already scheduled to increase gradually from 65 to 67; (3) cutting benefits; and (4) revising the structure of the system. The latter proposal stirred the greatest controversy. Money in the Social Security trust fund had always been invested in safe but low-yielding government bonds. Several ideas for reform called for moving a portion of the funds into private savings accounts, a move that would invest it in riskier but higher-paying stocks. The bipartisan National Commission on Retirement Policy, a group of congressmen, business leaders, and academicians, recommended allowing individuals to invest 2% of their payroll taxes in government-selected funds. It also called for raising the retirement age to 70 and creating a minimum benefit for low-income retirees. Several other proposals were introduced in Congress by both Republicans and Democrats. Critics of privatized accounts raised questions concerning the percentage of trust money that should be shifted to equities, who would do the investing, what would happen if the stock market went down, and whether the change would be fair for women and low-income retirees. Wary of tinkering with a popular program in an election year, Congress did not act on any of the proposals, although it did decide to hold 90% of the budget surplus in reserve until Social Security was solvent. Like Social Security, Medicare, which provided health insurance to about 38 million Americans over the age of 64, also faced financial problems. As medical costs soared and increasing numbers of elderly persons entered the program, the cost of Medicare was expected to grow from less than 3% of gross domestic product to about 6%. The Social Security trustees' report said that Medicare was financially secure until 2008 and that its financial outlook for the next 75 years had improved because of cost-cutting measures and other changes in 1997. The job of dealing with Medicare's solvency was given to a 19-member National Bipartisan Commission on the Future of Medicare, which was scheduled to present a plan to Congress on or before March 1, 1999. The most significant new initiative by Congress in the realm of social protection was passage of the first complete overhaul in 60 years of U.S. public-housing policy. The landmark legislation created 90,000 new vouchers, or federal rent subsidies, for fiscal 1999 and authorized another 100,000 vouchers in each of the following two years. Three million Americans received federal help in paying their rent or buying an apartment, but, according to the most recent government survey, in 1995 there was a shortage of 4.4 million affordable rental units for low-income households. An innovative feature of the new law allowed officials to offer apartments in public housing projects to working families with incomes of up to $40,000 a year. The hope was to bring stable, higher-income working tenants into those projects in an effort to create greater diversity, reduce drug use and other crimes, and improve the image of public housing. At least 40% of public housing, however, would continue to be reserved for the very poor--and 75% would be reserved for families making 30% or less of the median income in the area in which they lived. Congress extended the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) through 2003, with new provisions to weed out fraud. The renewal included after-school snacks for teenagers in low-income areas and a three-year pilot school-breakfast program. WIC provided federally funded vouchers for infant formula, cereal, and other nutritious products to supplement the diets of about 7.3 million low-income pregnant women, infants, and children up to age five. In October the long-planned computerized national child-support clearinghouse began operations. It matched child-support case information sent in by states with information about wage earners across the country in an effort to track down absent parents who owed annually about $17 billion for support. No action was taken on requests by President Clinton to increase the minimum wage and to open Medicare to some 55-64-year-old retirees who would pay monthly premiums. They were among the 44 million Americans, including 12 million children, who lacked health insurance because they could not obtain it through work, could not afford it, or were ineligible for Medicare or Medicaid, the government insurance program for the poor. Meanwhile, the impact of the historic 1996 welfare-reform law continued to expand. The U.S. Department of Health and Human Services (HHS) reported that 3.8 million individuals had left welfare rolls since passage of the reform law, which had reduced the caseload to its lowest level since 1969, and that 1.7 million adults who had been on welfare in 1996 were working in March 1997. According to HHS, states were spending more per person on welfare-to-work efforts than they had spent before passage of the reform. Despite the positive results, welfare reform remained a work in progress, with real and potential problems. Moving welfare recipients into jobs was likely to slow when the U.S. economy cooled and the availability of low-wage jobs shrank. In addition, those who made the jump from welfare to work in the first two years were generally the "easiest" cases; many of the more difficult ones, the people with fewer skills and less education and training, had not yet been placed. Cracks appeared in the support system, especially in providing child care for mothers entering the workforce and transportation to help newcomers get to their jobs. In response to public outcries and prodding from Clinton, Congress continued to "reform" the reform. It restored Supplemental Security Income to elderly and disabled immigrants and food stamps to 250,000 legal immigrants who had been dropped from the rolls. The early success of welfare reform was aided by a dramatic drop in poverty and an increase in incomes. Census Bureau figures showed that the overall U.S. poverty rate fell to 13.3% in 1997, from 13.7% in 1996, which left 35.6 million people living below the poverty line of $16,400 annually for a family of four. At the same time, the median household income of American families, adjusted for inflation, rose 1.9% to $37,005. Virtually all sectors of the population--all races, single mothers and married couples, and most geographic regions--registered improvement. African-Americans and Hispanics had especially strong gains, with the poverty rate for African-Americans falling to an all-time low of 26.5% and the Hispanic rate declining to 27.1%. Strong economic growth and low unemployment were cited as two of the main reasons for the improvement. One of the most contentious issues in Canada was the proposed Seniors Benefit, which had been announced by Finance Minister Paul Martin in his 1996 budget and in 2001 would replace the existing Old Age Security and Guaranteed Income Supplement programs with a single payment. The goal of the new plan was to increase payments to low-income seniors while decreasing the amounts given to financially better-off recipients. After further scrutiny of the plan, however, investment advisers found that benefits would be eliminated entirely at a much lower income threshold ($52,000 for a single senior and $78,000 for a couple). Critics argued that the scheme penalized middle-income Canadians who had saved for retirement. In the face of rising opposition, Martin dropped the plan. In October provincial finance ministers met with Martin and asked for more funding for health care, citing a federal budget surplus of some $3.5 billion. They argued that the provinces should be given a free hand to allocate money for health care without interference from the federal government and voiced concerns about entering partnerships, especially in light of a past $6.2 billion federal cut to health care. Europe. In Austria a reform of the pension insurance system was essentially intended to raise the retirement age. It was made easier, beginning in January, for individuals to qualify for a "flexible pension," a move that was designed to allow more people to remain partially employed instead of taking full retirement. Sweden, too, introduced incentives for workers to remain employed longer. In June the Rikstag (parliament) adopted a pension-reform bill that had been under discussion since 1994; the pensionable age would become flexible, with later retirement resulting in higher pensions based on lifetime income. At the time of retirement, the yearly pension entitlement would be calculated and would reflect the average life expectancy. A reform of the German pension system, adopted in late 1997, was scrapped in October by the new government of Gerhard Schrder. (See BIOGRAPHIES.) In The Netherlands significant changes were introduced in January for the protection of people with disabilities. Employers were given the option, at least in part, of insuring themselves outside the social security scheme against the risk of their employees' becoming incapacitated. A "general contribution" was still payable to the fund, however, essentially to ensure the funding of existing disability pensions. Expenditures were increased in Ireland for measures to support employment and reentry into the workforce. Finland revised the rules governing the granting of unemployment benefits to encourage unemployed persons to begin job training or retraining. Previously, anyone deciding to seek further education or training suffered substantial losses in benefits. A number of countries modernized their social protection systems to promote fairness and opportunity. New approaches, including new technology, were used to improve welfare delivery and to reach those who were entitled to benefits but were not receiving them. At the same time, recipients were reviewed for continued eligibility. In March the U.K. government published a Green Paper that advocated a reform of welfare based on a new contract between citizens and government. The Green Paper detailed a series of measures to be achieved over the next 10-20 years, including a reduction in the proportion of working-age people living in households without wage earners, a guaranteed adequate retirement income for all, more support from the tax and benefit systems to families with children, and clearer gateways for determining eligibility for all types of benefits. In France, where it is necessary to have contributed for at least 40 years and to have reached the official retirement age of 60 in order to be entitled to an old-age pension, a special preretirement allowance was created to guarantee a minimum monthly stipend for longtime contributors under the age of 60. The measure would address the situation in which a person who had started working early in life, had contributed for 40 years, and then became unemployed before the age of 60 was without an adequate income. In Belgium a social identity card was issued by mutual-benefit societies to all persons covered by social insurance to substantiate their rights to benefits. The introduction in Italy of a "social credit card" was discussed; the card would contain information such as the personal income and assets of the insured person and would make it possible to allocate benefits according to individual circumstances. In June the European Union social affairs ministers agreed to adopt a directive that would protect the supplementary pension rights of those people who were employed and self-employed and were moving within the EU. Pension rights would be preserved rather than transferred from one scheme to another; the cross-border payment of pensions would be guaranteed; and workers temporarily posted in another member state would remain affiliated with the scheme to which they had initially belonged. The Romanian government initiated a series of measures in response to economic restructuring and privatization programs, which had negative effects on social welfare. Counseling, job-placement, and occupational reclassification services were established in cases of mass firings. Special compensatory payments were granted in the form of a lump sum, the amount of which varied according to the level of unemployment in the region. Concerns about fund deficits, poor investment returns, and allegations of corruption led the Hungarian government to place its pension and health funds under more direct control. The funds previously had been supervised by two independent bodies. In January Hungary began implementing its new multilevel pension system, which comprised the mandatory social insurance pension (pay-as-you-go) scheme, new (privately funded) mandatory private pension funds, and voluntary pension funds. Estonia agreed to establish a similar system, which was likely to be implemented in January 2000. The Polish govern