I've always thought something like turtle graphics (e.g. http://www.sonic.net/~nbs/webturtle/) is a neat way to teach kids programming/algorithm basics.

It's simple enough to understand the basics, yet powerful enough to be engaging enough to keep a child's interest, providing them a direct visual output to their 'code'.

I would stay away from the higher level stuff like Visual Basic; there is so much magic going on under the hood that it becomes difficult to really internalize the basic concepts of programming.