The report presents data and discussion on U.S. education across sectors, as well as the work of the Office of Education (OE). Among topics covered are the education budget; OE reorganization; educational priorities, including basic skills, binding school to work, higher education, education of the handicapped; legislation, including the 1978 amendments to the Elementary and Secondary Education Act of 1965, the Middle Income Student Assistance Act, and tuition tax-credit proposals; OE finance and management; grants and procurement; waste, fraud and abuse reduction, including in federal student loans and with institutional-accountability programs; regulation-writing and comment-reconciliation simplification; paperwork-burden reduction, including streamlining, consolidating, or reducing reports and forms; improving personnel practices, including increasing representation of women and minorities, and improving supervisory performance; training activities at the OE Horace Mann Center, including reducing bureaucratic language in writing, employee development at all levels; and the Education Forum Branch activities including "The 1978 Assembly" during American Education Week, the Teacher of the Year Lecture, the Presidential Scholars Panel, the Washington Policy Seminars, and "Education in America" seminars participation; and audit resolution.