THE WEEK

By JANICE M. HOROWITZ, LINA LOFARO, MICHAEL QUINN, JEFFERY C.RUBIN, ALAIN L. SANDERS AND SIDNEY URQUHART

NATION

OPEN AND SHUT CASE, PART 2

For the second time in a month, the Federal Government was forced into a partial shutdown after budget talks between congressional Republicans and the White House collapsed. President Clinton accused the G.O.P. of wanting to make "deep and unconscionable cuts in Medicare and Medicaid." Senator Robert Dole retorted, "I don't think he's telling the American people the truth." The two sides could not agree on when to restart negotiations.

ALAS! COUNT US IN

Sidelined, as it has customarily been whenever the Commander in Chief has decided to commit U.S. troops abroad, a deeply ambivalent Congress voted on a jumble of Bosnia resolutions. The net effect of the House and Senate actions was to express full support for the U.S. troops who will be sent on the nato peacekeeping mission but to register deep reservations about the deployment.

A HARDY CONSTITUTION

It's not easy to tinker with the work of the nation's founders. For the third time this year, Congress failed to pass a Republican-sponsored amendment to the U.S. Constitution. The Senate fell three votes short of the two-thirds majority needed to approve an amendment banning physical desecration of the U.S. flag, which opponents argued was antithetical to free speech. Proposed amendments requiring a balanced budget and congressional term limits have also failed.

WHITEWATER IMPASSE

The confrontation sharpened between the Senate Whitewater committee and the White House over access to the notes of a 1993 Whitewater meeting attended by White House lawyers and Bill Clinton's personal lawyers. Rejecting a last-minute White House compromise, the committee voted along partisan lines to ask the full Senate to enforce a subpoena for the notes. Unless one side or the other blinks (Clinton is asserting attorney-client privilege), the issue could soon be headed for the courts.

A ROYALTY PAIN

The House ethics committee, which has been investigating the finances of Speaker Newt Gingrich, proposed altering the chamber's rules to bring book royalties under the $20,040-a-year limit on members' outside income. The G.O.P. leadership wants the change vetted in hearings, which will give Gingrich more time to collect possible multimillion-dollar revenues from his 1995 book To Renew America.

NO AVERAGE JOE

Utah Representative Enid Greene Waldholtz held a five-hour press conference to explain the soap-opera saga that has sent her skyrocketing political career into the tailspin of a financial and marital scandal. A tearful Waldholtz claimed she was conned by her husband Joe, who she said improperly manipulated both their personal finances and her 1994 campaign funds. Waldholtz insisted she would not resign, though only 39% of surveyed Utah voters believed her version of events.

ELECTION RESULTS

As expected, Jesse Jackson Jr., son of the civil rights activist, handily beat his G.O.P. opponent for the Chicago-area House seat vacated by scandal-tainted Mel Reynolds. In California, Republican Tom Campbell turned back a Democratic attempt to link him to Speaker Newt Gingrich and won a San Jose House seat, and former Democratic state assembly speaker Willie Brown was elected mayor of San Francisco.

AN ARMY PROBE

Reacting quickly to the shooting death of a black man and woman in Fayetteville, North Carolina, and the arrest of three white Fort Bragg soldiers, two of whom authorities have identified as skinheads, the Army ordered a sweeping investigation into the extent of extremist activities among its troops.

SAFER SKIES

In response to a series of deadly crashes involving regional and commuter airlines, the Federal Aviation Administration extended to the nation's smaller airlines many of the tougher safety, training and equipment rules already imposed on major carriers.

O.J., THE CIVIL TRIAL

O.J. Simpson's onetime girlfriend, model Paula Barbieri, gave her deposition in the civil suit filed against the ex-football hero by the families of Nicole Brown Simpson and Ronald Goldman. According to an attorney present, Barbieri testified that she left Simpson a "Dear John" phone message on the morning of the murders.

WORLD

BOSNIAN PEACE SIGNED

Bosnia and Herzegovina enjoyed the prospect of a peaceful Christmas, the first in nearly four years, after the Presidents of Bosnia, Croatia and Serbia signed a treaty in Paris. President Clinton also signed it, along with the leaders of Britain, France, Germany, Russia and Spain, at a ceremony in the Elysee Palace. Under the agreement, Bosnia will be partitioned into two roughly equal parts--one for Bosnian Serbs, another for a Muslim-Croat federation. In Bosnia, advance teams from nato's 60,000-strong peacekeeping force were battling only record snows in the initial stages of their deployment.

SERBS RELEASE FRENCH PILOTS

Just two days before the treaty signing, Bosnian Serb military commander General Ratko Mladic released two French pilots who were shot down during a nato bombing raid Aug. 30. Captain Frederic Chiffot and Lieut. Jose Souvignet were freed after France put intense pressure on Serbian President Slobodan Milosevic.

FRENCH STRIKES NEAR AN END

France's transportation nightmare moved toward an end as rail workers drifted back to their posts despite union calls to hold out. The three-week strike, led by transport workers, was in protest against proposed reforms to the French social-security system, and in particular a tightening of the retirement scheme of France's 5.5 million public-sector workers. Following concessions made by Prime Minister Alain Juppe on the retirement issue, many workers voted to end the labor action, which had never gained the active support of private-sector employees as hoped.

DISSIDENT SENTENCED

Ignoring international human rights concerns, China sentenced its best-known dissident, Wei Jingsheng, to 14 years' imprisonment for sedition, citing his nonviolent advocacy of democratic reforms. Wei has already served 14 1/2 years in prison for his essays calling for political freedom during the 1978-79 Democracy Wall movement.

ISRAEL AND SYRIA RESUME TALKS

Israel and Syria agreed to renew their peace negotiations on Dec. 27. The talks, which broke down last summer, could lead Syria to recognize Israeli sovereignty and security in exchange for the Golan Heights. Also, Israel pulled out of Nablus, the largest town in the West Bank, 48 hours ahead of schedule in order to prevent confrontations with Palestinians.

HELLO, EURO

The European Union announced that, beginning Jan. 1, 1999, Europe will have a single currency, to be called the euro. Germany, France and the Netherlands would probably be among the first to switch. Britain hasn't decided if it will take part. Under the Maastricht Treaty, each country must meet strict economic standards before it can join the currency union.

SCIENCE

DRUG FOR STROKES

In a medical breakthrough, a genetically engineered clot-dissolving drug, TPA, has been found to help prevent the irreversible brain damage that afflicts many stroke victims. Patients who received the drug were at least 30% more likely than untreated patients to suffer zero or minimal disability after three months. On the downside: TPA carries a small risk of brain hemorrhage and must be administered within three hours of the stroke.

A BOOST FROM A BABOON

In a highly risky experiment, doctors infused bone marrow from a baboon into John Getty, a 38-year-old man dying of aids, in the hope of boosting his frail immune system. "I know I could die from the treatment,'' Getty said, "but I am certain that I will die if I do nothing."

THE ARTS & MEDIA

THE PEACOCK STRUTS ITS STUFF

In the richest deal in sports-television history, nbc successfully bid a whopping $2.3 billion for the right to broadcast the 2004 Summer Olympics, the 2006 Winter Games and the 2008 Summer Games. The network also cut a risky but potentially lucrative deal with Microsoft to create an all-news cable channel.

--By Janice M. Horowitz, Lina Lofaro, Michael Quinn, Jeffery C. Rubin, Alain L. Sanders and Sidney Urquhart