What was Santorum Thinking?

In Thursday's Republican presidential debate, former Senator Rick Santorum was asked whether as President he would make any changes to the military that would undermine the recent repeal of Don't Ask-Don't Tell.

Santorum responded by saying "Yeah, I -- I would say, any type of sexual activity has absolutely no place in the military."

What?

Did he think that, before the repeal of DADT, the military was chaste?

And then he went on to say: "And the fact that they're making a point to include it as a provision within the military that we are going to recognize a group of people and give them a special privilege to -- to -- and removing 'don't ask/don't tell' I think tries to inject social policy into the military."

Does he think that the repeal of DADT gives gay and lesbian soldiers a special privilege to engage in sex at times or in places not permitted to heterosexual soldiers?

So what was he thinking?

He seems to have a perspective that 180 degrees opposite from the majority of American people who believe that the repeal of DADT will remove social policy from the military.

Taxing Political Expenditures

The Supreme Court's recent decision in Citizens United v. Federal Election Commission severely restricts the ability of Congress to regulate, much less prohibit, the use of corporate money to influence elections, but what about Congress's power to tax that money?

As it is now, corporations cannot claim expenses of attempting to influence elections or legislation as business expense (see Internal Revenue Code section 162(e)). So corporate profits that are spent on electioneering are effectively subject to income tax at the corporate level. The shareholders bear the burden of the tax, but very indirectly.

But what if the expenses of electioneering were considered a form of a dividend?

This is not unprecedented, because there are lots of places in the Internal Revenue Code in which something that looks like one thing is recharacterized as something else. To take just one example, IRC section 7872 says that if a corporation makes an interest-free loan to a shareholder, the loan is recharacterized as an interest-bearing loan at a market rate of interest, with imputed interest payments by the shareholder to the corporation and imputed dividend payments in the same amounts by the corporation to the shareholder. There are also many rulings and court decisions in which officers or shareholders who have used corporate money to pay personal expenses are held to have received either compensation or dividends from the corporation.

So it would not be unreasonable for Congress to say that, if a corporation uses its money to advance the personal political beliefs of the officers or shareholders, that money should be considered to be payments to those officers or shareholders. For most publicly-traded corporations, dividends are not tax-deductible by the corporation, so income paid out as dividends is taxed twice, once at the corporate level and again at the shareholder level.

But the really nasty part is that Congress could offer corporations a choice: If the political expenses are approved by the shareholders, then the expenses could be considered a dividend to those shareholders, but if the political expenses are approved only by the board of directors, then the income falls on the directors alone.

Neither alternative is going to be very appealing to corporations. Getting shareholder approval for political spending could turn shareholder meetings into political battles, and stock prices could suffer if investors decide that they don't want to own a stock that pays a dividend of $10 while the investor has $12 of taxable income. But directors are certainly not going to want to pay personal income tax on what might be millions of dollars of income they never actually received.

Taxing directors or shareholders on the money spent on corporate electioneering might not solve the problem of corporate influence, but it might make it more difficult and more painful.

Mis-Speaking

The divergences (shall we say) between Hillary Clinton's descriptions of her trip to Bosnia and what actually happened are now well documented. See, for example, the video compilation at http://blip.tv/file/778770. And there is talk now that the incident has "blown over."

But has it?

There are also problems with her claims of having been "instrumental" in the peace process in Northern Ireland, a claim that has been refuted by just about everyone who was actually involved in the peace talks.

As a result of these and other statements by Clinton, the non-partisan Annenberg Public Policy Center's "FactCheck.org" has described her claims of foreign policy experience as "exaggerated."

What might that mean for the general election?

During the 2000 election, Al Gore was repeatedly held up to ridicule because he had claimed to have "invented the Internet," and had claimed that he and his wife were the models for the central characters in Erich Segal's Love Story, even though Al Gore did not make those claims.

During the 2004 election, John Kerry came under attack by the "Swift Boat Veterans for Truth" for allegedly lying on the military reports that resulted in military citations and medals during his service in Vietnam 40 years before. The stories told by the "Swift Boat Veterans" were politically motivated and were eventually found to be not credible, but not before political damage was done.

That's what Republicans and conservatives have done when they have had to fabricate in order to create the appearance of dishonesty in a Democratic candidate. What is going to happen when they have recent and well-documented evidence of what appears to be dishonesty?

It's going to a long campaign for Hillary Clinton in the fall if she is forced to spend most of her time explaining that she "mis-spoke" repeatedly during her primary campaign.

The Iranian Nuclear "Threat"

In the most recent National Intelligence Estimate on Iran, the Bush administration reluctantly (and embarrassingly) admitted that the Iranian nuclear weapons program, which has been the focus of its policy towards Iraq, doesn't actually exist.

In the past, when asked about the possibility of military action against Iran, Bush has repeatedly said that "all options are on the table," and that the United States would use force against Iran if diplomacy failed.

And yet yesterday (12/4), facing questions about his own administration's assessment that Iran actually halted its nuclear weapons program in 2005, Bush repeated and confirmed his policy that "all options are on the table."

That's right, the President of the United States still holds out the possibility that we might bomb or invade a country that, according to our own intelligence agencies, (a) has no nuclear weapons, (b) is not building any nuclear weapons, and (c) has (as far as we can tell) no present intention of building any nuclear weapons, simply because that country might change its mind and start to build nuclear weapons in the future.

Is that crazy? Yes, but it is also consistent with a President who does not know how to govern or negotiate except through fear. Bush does not know how to negotiate with Iran except with threats, and Bush does not know how to lead this country without first trying to scare its citizens.