THE YEAR began on a hopeful note with the arrival of a healthy, eight-pound nine-ounce baby boy.

Clive Daniel Casey III arrived at 4.19 a.m. on January 1.

But as little Clive observes his first birthday next week, his departure from Bermuda may be imminent. Clive's father works at the US Naval Air Station, now known in America as the Navy's "Club Med.'' US budget pressures could force a major downsizing or closure of the Base, now seen by many Americans as a wasteful playground for military brass.

Just as it has affected Clive, the economy was the major factor influencing most Bermudians in 1992.

Burger Island went bust over a $64,500 debt on January 2, and from there the job losses and closures mounted.

Retailers saw sales volumes 20 percent below 1988 levels, and unemployment jumped to a record high as the Bermuda Commercial Bank, the Bermuda General Agency group of companies, GTE Reinsurance Co., and the Belmont and Southampton Princess Hotels joined a growing list of companies which made employees redundant.

There was labour unrest, and visitor numbers went from bad to worse. And while the fate of the US Naval Air Station was uncertain, that of the Canadian Forces Daniel's Head base was not. The Canadians announced they would cease operations in May of next year and close the base permanently in December.

Meanwhile, the US Naval Facility was closed in a ceremony which marked the end of 37 years at Tudor Hill in Southampton.

By November, Labour and Home Affairs Minister the Hon. J. Irving Pearman said the recession had killed nearly 1,000 jobs in the last 12 months.

It sometimes seemed Bermuda just could not have any luck in 1992.

Bermuda Track and Field Association, organisers of the 10-kilometre and marathon running races, were forced to hand out medallions with the country's name spelled "Burmuda,'' after an error was made in the US.

Mr. John Weatherill declared the long-accepted portrait of Sir George Somers in the Bermuda Historical Society Museum a fake.

Despite spending millions, Bermuda resident Mr. H. Ross Perot fell far short in his bid for the US presidency.

Even a Bermuda beauty pageant could not go off without a hitch, as there were charges of racism, lawsuits, and problems collecting the prizes.

And thieves made off with the Island's flag at the Barcelona Olympics.

But to look at the glass as half full, Bermuda's inflation rate hit 2.5 percent in February, its lowest level since 1977, and interest rates fell.

And besides lovely weather, natural beauty, and friendly good mornings, the year had its moments which lifted spirits and national pride.

Julie-Anne Irvine, a 16-year-old Bermuda High School student, used artificial respiration to save a baby girl who collapsed and stopped breathing in a jewellery store in England.

Bermuda's Barbarian rugby player Mr. Tim Winkleman was hailed as a hero after he rescued a woman from drowning in Trinidad.

Bermudian youngster Bernell Williams, 14, came first in his class at Maryland's Johns Hopkins School, which caters to gifted students.

Hundreds of Bermudians turned out in February to help St. David's Islanders stricken by a fierce tornado.

A $20-million cop show set in Bermuda was in the works, planned as a joint production between British and US networks.

And Bermuda received television exposure which could send women flocking to our shores when model Mr. Antonio Smith, 25, appeared on the Oprah Winfrey international match-making show.

While it had no quick fixes, Government moved to try to stop the economic bleeding. Top businessman Mr. David Lines was named by the Premier, Sir John Swan to chair a blue-ribbon task force to examine Bermuda's long-term employment needs.

Sir John also unveiled plans to chair a Commission on Competitiveness, with a mandate to improve tourism and international business and to find new business opportunities.

Restraint was Government's main response to Bermuda's economic woes. In February, Finance Minister the Hon. Dr. David Saul unveiled a recession budget he said was aimed at holding down spending while boosting employment through more than $78 million in capital programmes.

To pay for the work, Government issued bonds for the first time in 20 years.

And taxes rose, by 35 cents a package on cigarettes, one cent a can on beer, two cents a litre on gasoline, and by 19 cents and 50 cents a bottle on wine and spirits respectively.

Bank licence fees shot up by almost 200 percent, to $500,000 annually. Seven Prison officer jobs were cut, training for Police hopefuls was suspended, and branch libraries in Somerset and St. George's were targeted for closure and replacement with bookmobiles.

Restaurant and shop owners in Somerset were furious when Government again shelved plans for a new ferry dock in the village. The cash-strapped Bermuda Regiment announced it was rolling its two overseas camps into one.

Despite the restraint, Government spent $37.1 million more than it raked in, and many Bermudians felt the cuts did not go deep enough.

Mr. J. Michael Collier, the Bank of Butterfield's chief general manager, urged an Island-wide wage and salaries freeze, and said Government should show leadership by setting an example.

And there were calls for a downsizing of the Government's car fleet in December, after it was revealed the 88 automobiles ran up an annual bill of $260,000.

Control over foreign workers was also tightened in response to job losses.

Home Affairs Minister the Hon. Irving Pearman said he would consider requiring some local companies to hire Bermudian understudies for certain jobs as a condition of granting work permits.

And Portuguese nationals demanded they be given the rights and privileges of locals in the workforce, as the recession caused long-time residents to lose their jobs to Bermudians.

While Government was restricted by economic problems in 1992, it was not handcuffed.

New laws passed included the Trades Disputes Act, a lowering of the drunk-driving limit to 80mg of alcohol in 100ml of blood, a change which required fewer speeders to attend court, a hike in the maximum compensation for crime victims to $70,000 from $50,000, a widening of drug seizure laws to allow asset seizures before traffickers are convicted, tougher pollution laws aimed at reducing smoke from ships, tougher dog controls, and a broadening of the Human Rights Act.

But gay sex remained illegal, and a campaign gathered steam late in the year to force a change.

To improve its efficiency, Government installed a smaller, more powerful, and costlier computer -- for $637,000.

But electronic help was not the only type Government called on. US consultants Penn & Schoen undertook a $25,000 education survey. Canadian education consultant Mr. Edwin Taylor came to the Island to help with school reforms.

Two senior Canadian prison experts arrived for a major review and shake-up of the Island's prison system. And an overseas architectural firm was hired to design a $40-million senior high school at the Devonshire Academy site.

Bermuda launched an investigation into its criminal justice system under Her Majesty's Inspector of Prisons in England and Wales Judge Stephen Tumim. And Dr. Richard Lee, an American plant pathologist, came to the Island to fight a deadly virus sweeping Bermuda's citrus trees.

Government unveiled a $75-million-plus scheme to revolutionise Bermuda's war on waste, with the Tynes Bay incinerator as its centrepiece.

Recycling began, and by April the problem was to keep recycling bins from overflowing, as Bermudians turned in four to five times more waste than expected. Blue bags for curbside collection of recyclables were introduced in November.

NEW GOVERNOR, NEW MUSEUM AND A FIRST NATIONAL GALLERY The House of Assembly also approved plans for a $10-million Bermuda Underwater Exploration Institute on East Broadway, and purchase of 11 acres of land at Blue Hole Hill as the basis for a new national park and nature reserve.

Minister of Community and Cultural Affairs the Hon. Leonard Gibbons opened the Bermuda Railway Museum on North Shore Road in Hamilton. And Bermuda's first National Gallery opened in the City Hall East Exhibition Room.

Chief Justice the Hon. Sir James Astwood cut the ribbon for the new Registry of Supreme Court on Front Street, and a new mammography unit for detecting breast cancer was opened at King Edward VII Memorial Hospital.

But it was revealed the national sailing centre completed two years earlier could not be used until a $1-million breakwater was added.

Governor Sir Desmond Langley, who promised Bermuda would remain an important strategic pillar in American and British defence planning despite budget cuts, left Bermuda after a stay of nearly four years.

The arrival of his replacement, former British Home Secretary Lord Waddington, was disrupted only by a small and peaceful demonstration by members of the Committee for the Independence of Bermuda.

Sir John Swan, who celebrated his 10th anniversary in office, hinted early in the year he would like to find a successor and step down. But he showed no such inclination as the year progressed.

Among other initiatives, the Premier went to Washington in June to fight regulation changes which threatened the Island's international insurance business.

He welcomed the surprise election victory of UK Prime Minister John Major in April, and put a bright face on US President-elect Bill Clinton's win in November after he said he was pulling for President Bush.

Sir John praised Bermuda's role in facilitating the successful negotiation of the $230-billion oil deal between the Republic of Kazakhstan and Chevron Corp., described as the largest-ever commercial deal between East and West.

He later rejected Opposition charges of conflict of interest when he was named a director of the Caspian Pipeline Consortium which would transport the oil.

Youth and Sport Minister the Hon. Harry Soares resigned in January after more than three years service, citing the need to devote more time to his ailing submarine business. Community Affairs Minister the Hon. Leonard Gibbons assumed his youth portfolio.

In a March shuffle, former Home Affairs Minister the Hon. Irving Pearman returned to his old post, while Sen. Pamela Gordon was named Minister of Youth, Sport, and Recreation. With the resignation of Government Senate Leader the Hon. Charles Collis, Information Minister the Hon. Michael Winfield first took over Sen. Collis' responsibility for telecommunications, and later the Senate leadership as well.

The Hon. Sir John Sharpe, Home Affairs Minister since Mr. Pearman resigned for personal reasons, retained his Delegated Affairs portfolio, while Sen. Gordon took over the Youth portfolio from Mr. Gibbons.

In other changes, Speaker of the House the Hon. David Wilkinson said he would quit politics when the present Parliament ended, and members of the UBP's Paget West branch chose 30-year-old Tim Smith to replace him in the next election. Former Transport Minister the Hon. Sidney Stallard announced he would not be back.

And Government Sen. Cindy Trimm resigned from the Upper House, saying she planned to leave Bermuda to further her education.

Lawyer Mr. Jerome Dill defeated party stalwart Mr. Elroy Ratteray in a UBP primary in May and won his place alongside Deputy Premier the Hon. Ann Cartwright DeCouto on the party's Pembroke West Central ticket.

Mr. Joe Gibbons, newly-appointed executive officer of the UBP, apologised for lewd comments he made before an all-female audience, and said he would quit doing stand-up comedy at The Club.

PLP MP Mr. Julian Hall was at the centre of numerous controversies. He caused a stir when he suggested Sir John had played a role in his "financial demise,'' then was suspended from the House of Assembly for three weeks after an argument with the Speaker. At year's end, he engaged in a high-profile dispute with the Bank of Butterfield over his financial affairs.

The PLP invited Bahamian Prime Minister Sir Lynden Pindling to open its new Alaska Hall headquarters on Court Street. But Police were holding a founding member of the party after fire broke out in the hall a day before the ceremonies were to be held.

The National Liberal Party targeted 1,399 jobs held by non-Bermudians and said Government could ease unemployment and the impact of the recession by replacing non-Bermudian job-holders with Bermudians.

At the municipal level, the Corporation of Hamilton hired American shipping and cargo handling expert Mr. Joseph Barbera to overhaul the way the city docks were run. Decreased activity at the docks was cited as the main reason for the 1991 deficit of nearly $350,000.

While there was little rancour before 1,500 civil servants signed a new two-year contract with Government, relations between Government and the Bermuda Industrial Union were near an all-time low.

When a Board of Inquiry upheld the firing of Bermuda Forwarders shop steward Mr. Lynn Darrell for tardiness and absenteeism and said 15 other workers should end their strike in support of him, few realised how the dispute would escalate.

The company rejected the board's call for the workers' reinstatement, and union chief Mr. Ottiwell Simmons MP vowed to fight "to the bitter end'' to force the issue.

Soon after Bermuda Forwarders president Mr. Toby Kempe rejected a personal appeal to reinstate the workers from Labour Minister the Hon. Sir John Sharpe, the Premier said the fight was out of Government's hands.

Despite warnings from Government that any strike would be illegal, industrial action began on June 23, with garbage collection slowed, ferry service cut short, and sightseeing buses cancelled. Though participation was sporadic, unionised airport and dockworkers, Post Office employees, bus drivers, and others joined in.

Turmoil ensued. Pickets were arrested at the Airport, Government workers defied a Supreme Court injunction to return to their jobs, and the BIU faced a $100,000-a-day fine and seizure of its assets.

Finally, emergency legislation passed in the House of Assembly forced a binding settlement in the Bermuda Forwarders dispute. After less than two weeks of disruptions, the BIU called off the strike when a court agreed to stay the fines.

Government won the right to refer the dispute to its newly-created Trade Disputes Tribunal, and in the end, all sides claimed victory. The BIU was happy the Supreme Court agreed a dispute existed, while Bermuda Forwarders were pleased the court accepted that the 15 truckers ended their own employment by walking off their jobs.

Relations between the BIU and hoteliers were not much better. As the Island's eight largest hotels complained of a record $17.5-million loss in 1991, they said the BIU was demanding a first-year wage and benefits increase of nearly 25 percent.

The claim was denied by the union, and the two sides agreed on little else all year.

Hotel contract talks droned on before the Essential Industries Dispute Settlement Board, while battles also flared over tipping policy and collection of union dues at Grotto Bay Beach Hotel, and Sunday working at Sonesta Beach Hotel.

The new board was plagued with problems over alleged biases on the part of its members, whether its hearings should be held in public, and other issues. And when the board found in favour of the BIU in the tipping dispute, Grotto Bay Hotel management ignored the ruling.

Pink Beach Cottage Colony later joined Grotto Bay in tearing up its union agreement.

Meanwhile, there was evidence of severe cash-flow problems at the BIU, as through it all Mr. Simmons spoke of a plot by Government and hoteliers to crush the union.

In other hotel news, "guaranteed weather'' was announced as the latest device for attracting visitors in the off-season. Starting in January, major hotels will offer a 20 percent discount on their room rates for any day the temperature does not reach 68 Fahrenheit.

Aetna Life Insurance Company of Connecticut became the new owner of the Sonesta Beach Hotel.

The Elbow Beach Hotel re-opened more than two months late on April 15, after a $25-million refit. The hotel revised its plans for a six-storey, 120-room expansion amid opposition from The National Trust and others.

The St. George's Club went into receivership but stayed open, while the proposed $200-million Bermuda Ritz-Carlton Hotel remained in limbo.

But the private sector continued to invest in Bermuda.

The Bank of Bermuda went ahead with a new $44-million building on Bermudiana Road, and the Bank of Butterfield's multi-million-dollar plans to redevelop its Front Street headquarters were approved.

The Christian Willowbank Foundation received approval to build a 95-unit hotel-college colony on South Shore Road in Warwick.

But plans by Bermuda Properties Ltd. for a large condo development on Catchment Hill in Smith's were held up over objections from The National Trust and the Mid-Ocean Club.

International trade overtook tourism as the major source of foreign revenue in Bermuda, as visitor arrivals plummeted early in the year.

As the new $229-million cruise ship Royal Majesty made her first stop in Hamilton, Government delighted Island merchants by announcing it would seek a fifth regular caller.

At the Bermuda Airport, Works and Engineering Minister the Hon. Clarence Terceira unveiled a new look arrival area which promised to speed up the much-complained-about process of clearing Customs.

In the air, British Airways cuts in January left Bermuda with only two flights a week out of London. But the airline later promised a third flight would return in March.

And Continental Airlines started a morning flight to Newark, New Jersey in June, while USAir said it would start a new Boston service in the spring. In August, American Airlines slashed fares between the US and Bermuda by 30 percent, with other carriers following suit.

There was plenty of debate about Bermuda's education system, which PLP Sen.

Ira Phillip blasted as "racist, colonialist, and elitist,'' and former senior civil servant Mr. David Critchley lambasted as "a frightening example of an authoritarian and closed system.'' Government began what is expected to be a series of reforms. For starters, the controversial Secondary School Entrance Exam, better known as the 11-Plus, was history, and corporal punishment soon would be, Education Minister the Hon.

Gerald Simons announced.

But the conversion of four high schools to middle schools was delayed, at least until next year.

DETAILS OF STEAMY SEX SHOWS HEARD IN COURT Bermudian educator Dr. George L. Cook became president of the Island's only college, taking over from retiring president Dr. Archie Hallett. And the college came a step closer to unification when its new $6-million library was officially opened at Stonington campus.

Despite warnings, the Clara Muhammad Elementary School in Pembroke and the Christian Delivery Academy in Flatts continued to operate without licences.

And Montessori Academy principal Mrs. Sighle Fitzgerald sued the school for wrongful dismissal after the board of governors refused to renew her contract.

AIDS and drugs continued to take a toll on the Island, and the National Symposium on Children at Risk reported a "staggering'' number of Bermudian boys and girls were being battered and molested daily by people they knew.

The rate of AIDS cases remained stable last year, and epidemiologist Ms Rhonda Daniels warned as many as 2,000 Bermudians might be infected with HIV, the virus that causes AIDS.

As Mr. Bryant Richards, chairman and co-ordinator of Addiction Services, warned heroin was creeping back into Bermudian society, the House of Assembly unanimously backed far-reaching recommendations for a National Drug Strategy and creation of a new National Drug Agency to oversee the war on drugs.

Women assailed Bermuda's courts for gender bias and lenient sentences for crimes against females in a year that saw the dockets crowded with all types of crimes.

Long-time Crown lawyer Mr. Barry Meade was named Solicitor General, taking over from Mr. Andre Garneau.

After the shocking April robbery and killing of German tourist Antja Herkommer, 28, Leroy Elmer Burgess, 24, pleaded not guilty to premeditated murder.

His trial is awaited.

Magistrates' Court heard of a steamy sex show at the Prison Officers' Club as two Prison officers stood charged with exhibiting an indecent performance.

David Frost was fined $500 and George Cann $400 by Magistrate the Wor. John Judge. While their sentences were upheld on appeal, they were later reduced to absolute discharges.

In a separate case, Senior Magistrate the Wor. Will Francis fined the owners and manager of Scandal nightclub $300 each for knowingly exhibiting an indecent performance in a public place. They were found not guilty of permitting disorderly conduct on the club's Front Street premises.

Eugene Herbert Bean, a 42-year-old Smith's man who was HIV-positive, was jailed for three years for biting Police Pc. Gareth Davies.

Randolph Lightbourne, 25, of Somerset Road, a machete-wielding robber who stole $25,000 from security guards outside the Bank of Bermuda in 1991, was sent to prison for seven years. The Court of Appeal refused to lighten the sentence.

Southampton Rangers soccer star David Burchall was sentenced to eight years in prison for conspiring to import 107.4 grams of cocaine, and for possession of the drug intended for supply.

And the cruise ship Nordic Prince was fined $8,500 in Magistrates' Court for spilling 500 gallons of oil into St. George's Harbour.

Ted Ming, lead singer of the Bermuda Strollers, was freed after the Court of Appeals threw out the convictions of four men believed to be the local link in a drug smuggling ring. Ming, 53, had been sentenced to 20 years in prison. The Attorney General sought leave to appeal from the Privy Council in London, but was denied.

For the third time in two years, Milton Shane Watson stood trial charged with the premeditated murder of Mr. William Doe. He was found guilty of manslaughter and sentenced to 15 years in prison.

Claims that top Bank of Bermuda executive Mr. Arnold Todd stole millions of dollars from customers received their first public airing as the bank attempted to freeze his assets.

A series of court actions led to the Supreme Court granting the request of Mr.

Robert Thomson that Bermuda Vacations Ltd. be wound down.

An inquest into the death of 10-month-old Cannice Joann Cann was halted and her father Daniel Cann was charged with murder.

Another inquest into the death of four-year-old Justin Fisher heard plenty of finger pointing. But while the jury found the death of the child admitted to King Edward VII Memorial Hospital in 1991 to have his tonsils removed was "aggravated by a lack of professional care,'' it did not name or blame anyone.

Kindergarten teacher Mrs. Theresa Eileen Haley, badly injured in a horrific road accident, was awarded damages of $650,000 by the Supreme Court in one of the highest-ever payouts in Bermuda.

Chief Justice Sir James Astwood upheld the 1990 fishpot ban, rejecting claims by fisherman Danny Farias that it was unconstitutional and a breach of natural justice.

Not all reported crimes ended up in court.

A masked gunman blasted a bullet into a security van after confronting the driver outside a Heron Bay store. He and an accomplice fled with $10,000.

Police investigated a hate poster which attacked newly-installed UBP Sen.

Jerome Dill, but the racist perpetrator was never found.

Bermudian lawyer Mr. Michael Spurling told how he feared for his life as vicious robbers with knives held him hostage for six hours in his Hong Kong flat.

And there were wild rumours of crimes, but when four-year-old Chaona Woolridge disappeared from St. David's, all that was certain was her parent's heartbreak.

Keep Bermuda Beautiful, which had its clean-up efforts hampered by poor weather, launched a $500,000 fund raising campaign.

But there were environmental concerns besides litter. A university student from Berkeley warned Bermuda's mangrove swamp was dying. PLP MPs said people living near the Pembroke Dump were subjected to pests and awful smells as a result of Government's composting programme.

And when fishermen spotted the body of a huge sperm whale off the Island's coast only two days after a smaller one was pulled ashore, scientists' fears grew over extinction of the species.

Bermuda's visitors in 1992 included Prince Edward, youngest son of the Queen, who witnessed the Masonic Lodge's annual peppercorn payment for use of the State House.

Korean martial artist Ho Yung Pak, who played Donatello in the movie Teenage Mutant Ninja Turtle II, signed autographs at the Annex and entertained children at Pembroke Sunday School.

Mr. Kalyk Abdullaev, deputy Prime Minister of the Republic of Kazakhstan, met briefly with Sir John during a visit to the Island in February.

Soul superstar Miss Roberta Flack was on the Island to play two shows at the Southampton Princess.

Prime time TV stars "Hillary'' and "Ashley'' of CBS' Fresh Prince of Bel Air and "Laura'' from ABC's Family Matters arrived on the Island for the third annual Junior Youth to Youth Conference.

First lady of reggae Marcia Griffith arrived in April and performed at the Maritime Museum with other top reggae stars.

Young and the Restless star and former foster child Victoria Rowell brought hope to Bermuda's foster children and profits for the Physical Abuse Centre.

Women made gains in Bermuda in 1992.

After 19 years in the department, Ms Delores Swan was named the Island's first woman chief prison officer.

Crown counsel Mrs. Cheryl Ann Mapp was made a magistrate.

And Somerset resident Mrs. Fran Mitchell sent a 12-year-old male bastion tumbling by becoming the first woman ever to collect a Brains of Bermuda trophy.

But turnabout was fair play, and Mr. Edward Richardson was named Nurse of the Year.

A furore erupted when lawyer and Opposition MP Mrs. Lois Browne Evans was not named a Queen's Counsel.

As the year closed, Bermuda awaited the arrival aboard a Concord of 100 revellers who will ring in the New Year twice -- once on each side of the Atlantic.

Each member of the group will pay more than $10,000 for double the New Year's fun, but only one hangover.

As an Island with a high-price reputation, Bermuda can only view its first visitors of the New Year as a sign the recession may be ending and a bright omen for 1993.

FREED -- Mr. Ted Ming, lead singer of the Bermuda Strollers, embraces his brother and wife after the Court of Appeals threw out his drug smuggling conviction in February.

STRIKE ACTION -- Bermuda Industrial Union president Mr. Ottiwell Simmons (left) leads strike action over the Bermuda Forwarders dispute in late June.

FIERCE TWISTER -- A tornado cut a half-mile swath across Texas Road, Lighthouse Road, Sofar Lane, and the Cove Valley Road area of St. David's in March.

WASHED ASHORE -- Government Conservation Officer Mr. David Wingate (left) and Mr. Steven DeSilva examine the remains of a small sperm whale washed ashore in October.

MISSING GIRL -- Volunteers scour the St. David's area for signs of four-year-old Chaona Woolridge, who went missing in April. But she was never found. Mr. Milton Pringle Mr. Alan Dunch.