Background check: people to watch in the new Congress.

• Author: Henderson, Rick

On November 9, Bill Clinton became a domestic-policy lame duck. Since then, all of the energy and initiative for changes in taxes, spending, and regulation have originated on Capitol Hill. Even the White House's "Middle Class Bill of Rights" was upstaged by Hill Democrats when incoming Minority Leader Dick Gephardt proposed his own middle-class tax cut three days before Clinton unveiled his plan.

The November election was both a rejection of the high-handed ways in which Democrats have controlled the legislative branch and a call for a less-intrusive federal government. The House Republicans, led by Speaker Newt Gingrich, have already implemented long-overdue changes in the ways Congress operates - eliminating committees, requiring members to be present at committee meetings to cast votes, and forcing Congress to abide by the laws under which businesses operate.

But the November elections cannot be considered truly revolutionary unless Congress does more than keep its own houses in order. If the GOP is serious about rolling back the federal government, it must tackle arcane budget rules, the tax code, and regulations. And it must overcome powerful advocates for statism both inside and outside the Republican party.

The mainstream press may have conferred near omnipotence on Gingrich. But his voice won't be the only one heard on Capitol Hill. Senators and other representatives will serve up ideas that Congress will tackle, including some the speaker doesn't like. Here are a few bellwethers worth watching:

The Innovators

The Republicans' new congressional majority is a tribute to the power of ideas as party-building political tools. And as House Majority Leader Dick Armey proved with his base-closing commission, clever policy making can be a great way to build an individual career. The need for new ideas will continue once the 100 days of the Contract with America have come and gone. Expect the Republicans to look to these innovators for both policy and packaging to define the post-Contract Congress.

Rep. Chris Cox (R-Calif.)

The Orange County congressman floated his first initiative for the new Congress on election night: The Republicans might, he said, reorganize the House committee structure to reflect an anti-statist agenda, starting with committees on revision and repeal and on privatization and deregulation. Following Gingrich's operating procedure, Cox announced the possible reorganization first to the public, via TV appearances and newspaper interviews.

Such fundamental restructuring was too hot for Newt's revolutionaries. But the trial balloon marked Cox as an idea man in the new Congress, getting him favorable coverage from George Will and other columnists. And it reminded the Republican majority not to fall in love with passing laws - that their self-proclaimed agenda is to roll back government, not to expand it in new directions.

A member of the counsel's staff in the Reagan White House, the 42-year-old Cox is best known to Congress watchers for his work on budget reform. In 1989 he cooked up a plan to impose discipline on congressional appropriations and control the automatic escalation of even "discretionary" federal spending.

The articulate Newport Beach representative proposed switching to a one-page budget specifying how much could be spent in each of the 19 categories that make up the federal budget. If Congress went over the specified limits, the president could rescind the additional spending. The Cox plan also would have frozen each agency's budget at the previous year's level unless Congress specifically increased the budget, thereby doing away with "baseline budgeting."

Cox is the second-ranking Republican on the Budget Committee, after Chairman John Kasich of Ohio. Before the election, Republicans disgruntled with Kasich's compromise on the crime bill and suspicious that Kasich might be too friendly to Democratic tax-raising schemes had hinted they might hand a future chairmanship to Cox. The threat apparently worked; in the weeks leading up to the election, Kasich became one of the most important spokesmen for the fiscal provisions of the Republican Contract.

And Cox instead landed a leadership position as the new chairman of the Republican Policy Committee, the House's internal think tank. There, among other issues, Cox will gauge public support for the two Republican plans to simplify taxes: Armey's proposed 17-percent flat tax and incoming Ways and Means Chairman Bill Archer's plan to abolish the Internal Revenue Service and replace the income tax with a national sales tax. Cox is a critic of using taxes as a tool of behavior modification, and he may end up refereeing the coming struggle between Republicans who want to make the tax code simple and Republicans who want to lard it with credits and deductions designed to entice Americans to behave in a more conservative-approved manner.

Cox, whose Harvard law degree came along with an MBA, can also expect to play a major role in calming the calls for regulation that accompany each rediscovery that securities markets entail risk. The former securities lawyer was in the headlines when Orange County declared bankruptcy in December. In fact, he broke the story when he was handed a note from the county's lobbyist during a meeting with reporters. The note read: "Urgent: Orange County may declare bankruptcy by 1:30 this afternoon. Please call the SEC to get the federal courts to freeze the asset pool" to stop investors from pulling their money out. Cox read the first sentence aloud - he later said he assumed the news was already public - and thereby precluded any behind-the-scenes federal intervention.

As the GOP's point man on financial markets and an Orange County...