(FORTUNE Magazine) – MANAGING/Cover Story 36 THE NEW TURNAROUND CHAMPS When a business is in distress, these company doctors don't leech it like some medieval physician. They find the root trouble and stanch the bleeding, return the business to profitability, and then make it grow. Headhunters say that they're the hottest game in town. by Brian Dumaine

44 HOW AN OLD MASTER STUMBLED

THE ENVIRONMENT 46 WHAT WE SHOULD DO TO STOP SPILLS Contrary to what you thought, the tanker fleet is not losing ever more oil. But there's lots of room for improvement -- if Congress and the industry will work together. by Peter Nulty

THE ECONOMY 52 THE LONGEST EXPANSION EVER Growth so slow it will make you nervous. Rising inflation and interest rates. A tightfisted Federal Reserve. Small income gains. Nevertheless, the economy will still break the all-time record for expansion next year. by Todd May Jr.

57 THE WINNERS AND LOSERS Slow growth is better than no growth, and many industries will do just fine. Take food, drugs, entertainment -- and even heavy machinery -- for example. by Susan E. Kuhn and John Labate

MONEY & MARKETS 66 TOUGH TIMES FOR JAPAN'S BANKS Once they seemed on the verge of taking over the world. Now the juggernaut is slowing down. Competitors can breathe easier, but borrowers should expect to pay more. by Carla Rapoport

CORPORATE PERFORMANCE 70 THE ULTIMATE NUTS & BOLTS CO. Illinois Tool Works, which brings you nails for the rafters and six-pack holders for the soda, shows how a big business can be as nimble and creative as a small one -- while taking a steadfastly low-tech approach. by Ronald Henkoff

CORPORATE PERFORMANCE 74 WHAT'S SPARKING DURACELL An LBO that worked, the battery maker is getting a surge from consumer demand. by Alan Farnham

75 COMPANIES TO WATCH Valspar: a paint company that takes on gloss by sprucing up secondhand factories. by Ret Autry

Also: DH Technology, Uno Restaurant, and International Recovery.

TRADE 76 OVERSEAS SALES TAKE OFF AT LAST Led by Boeing and the computer industry, U.S. manufacturers are starting to make big dents in global markets. They're chipping away at the trade deficit too. by Jacob Park

THE SOCIETY/FORTUNE PORTFOLIO 78 VOLUNTEER WORK: BETTER THAN BEER Are business and law students just money grubbers? A good number do good as well. by Faye Rice

INNOVATION 82 PRODUCTS TO WATCH MTV for the brokerage industry, an electronic travel guide, singing ''My Way'' like the Chairman of the Board, and more. by Frederick H. Katayama

TROUBLE 84 THE GREAT FLORIDA OIL SCAM | A local boy swindled investors out of $130 million. Could the state's biggest bank have stopped him? by Erik Calonius

DEPARTMENTS 4 EDITOR'S DESK 8 INDEX 12 NEWS/TRENDS More B-schools question tenure, what cars CEOs are driving now, the pork in Panama's aid packet, IBM's second go at a home computer, and more.

21 PERSONAL INVESTING Three strategists draw a bead on the market as the Dow slopes toward 3000. by Andrew Evan Serwer

Also: a new hum in Honeywell's stock, getting more from your cash stash, and Portfolio Talk with John Rogers of Ariel Capital Management.

109 FORTUNE PEOPLE A wife buys out her husband at Esprit, Northwest Airlines gets a new CEO, Lewis Ranieri likes Texas S&Ls, and more. by Mark M. Colodny

110 ON THE RISE

113 BOOKS & IDEAS Kevin Phillips, a much quoted ''conservative Republican,'' inveighs against free markets, low tax rates, Bush, and business people. by Walter Olson

116 LETTERS TO FORTUNE

117 OFFICE HOURS Pushing off at a decent hour doesn't just improve your life; it makes you a better manager. Here are 12 reasons for leaving at five. by Walter Kiechel III

119 KEEPING UP The Klan speaks, what dreams are about in Ann Arbor, Tom Hayden goes for the green, and other matters. by Daniel Seligman

ABOVE: Peter Sibbald photographed Barry Gibbons, CEO of Burger King, with a Whopper in Miami.

COVER: Sibbald's camera caught Leo McKernan on a forklift at a Clark Equipment plant in Kentucky.