It Doesn't Get Any Better Than This

PRESIDENT BUSH has gotten a bigger reelection boost in a shorter period of time than any other president ever. And that may be putting it mildly. Yes, Sherman's taking of Atlanta in early September 1864 was critical to Lincoln's reelection, and Bill Clinton's signing of welfare reform in 1996 assured him a second term. But those don't quite match the gust of good news for Bush between Thanksgiving and Christmas.

Here's the list: capture of Saddam Hussein, Libyan dictator Muammar Qaddafi's about-face, enactment of a prescription drug entitlement, signing of the first rollback of Roe v. Wade, fastest economic growth in 19 years, quickest pace in worker productivity gains in 20 years, two-decade high in increased manufacturing activity, significant drop in jobless claims, lowest underlying rate of inflation in 38 years, and rock-bottom interest rates. Oh, yes, the stock market: A week before Christmas, the Dow's up 23 percent for the year, 4 percent since Thanksgiving.

Let's not give Bush a big head and declare his reelection a done deal. He still faces daunting problems (job losses, post-Saddam insurgency in Iraq, al Qaeda, nukes in Iran and North Korea, energized opponents at home). But, to Bush's credit, the string of accomplishments on the eve of 2004 are mostly his own doing. It turns out more troops were not needed in Iraq, at least not to seize Saddam. The answer, as the administration insisted, was better intelligence. Bush's tax cuts, nearly everyone agrees, were the catalyst in rejuvenating the economy. A full-blown recovery is now a given. Bush had helpers like Federal Reserve chairman Alan Greenspan and a good bit of luck. As the baseball saying goes, it's better to be lucky than good. It's better still to be in Bush's situation, lucky and good.

Grabbing Saddam produced a reversal in the Iraq debate. Saddam at large was the symbol of Bush's losing the battle of postwar Iraq. His captivity is the symbol of Bush's winning that battle. For months now, Saddam will be the story--his imprisonment, his interrogation, his atrocities, his prosecution, his punishment. When the spotlight is on Saddam in chains, Bush gains. If the terrorism directed by Saddam's cronies continues to abate, as it did in the days after his capture, Bush will gain further. In any case, he's no longer on defense in the debate over Iraq.

His foes are no longer on offense. Democrats were flummoxed by Saddam's capture. Columnist Robert Novak reported that Sen. Dick Durbin of Illinois, a top deputy to Senate Democratic leader Tom Daschle, had taped a radio statement, sneering at the prospects of seizing Saddam. It was to be broadcast the day after Saddam was captured. The Democratic presidential candidates, along with Sen. Hillary Clinton, responded to the capture with the cliché that Bush must "internationalize" the war in Iraq. This was a non sequitur: Because Bush's policy in Iraq was working, it was time to change the policy. That is not a serious argument.

Democrats exuded an air of unreality. They called for the United Nations to assume a bigger role in Iraq just days after Secretary General Kofi Annan announced the United Nations had no intention of doing that. They said Bush should recruit more foreign troops to replace American soldiers in Iraq. But there was no evidence any country was prepared to dispatch troops. And the Saddam capture led to more conspiracy-theorizing by Democrats. Congressman Jim McDermott of Washington suggested Saddam was ripe for seizure any time and Bush had planned the event for political gain. Of course this clashed with the standard Democratic criticism that Bush had lost control of postwar Iraq.

Democratic presidential frontrunner Howard Dean reacted with remarkable pigheadedness. He inserted in a speech the claim that Saddam's jailing did not make America safer. Earlier he had said Saddam was a "threat" to the United States. So Dean would have it that a threat was removed with no gain in safety for America. That defies logic. Besides, documents from Saddam's briefcase showed he was in regular touch, by courier, with terrorist cells perpetrating attacks on American soldiers and Iraqis. Once that was known, Dean could have revised his view. He didn't. He tossed out three charges against the president. One, Bush had claimed a direct link between al Qaeda and Saddam and later retracted the claim. Two, Bush had said the United States knew where Saddam's weapons of mass destruction were. Three, Bush had declared Saddam an "imminent danger." Dean was wrong on all three counts.

When was Bush lucky? That occurred as he dispatched former secretary of state James Baker on a mission to win debt relief for Iraq. Months ago, the administration made it known that countries not helping in Iraq would be ineligible for contracts to rebuild the country. The press missed this. Shortly before Baker departed for France and Germany, a routine Defense Department memo formally limiting the contracts was reported in the press. The belated scoop was the lucky part for the president. It created a media firestorm that Bush exploited to reiterate his policy and show the United States wouldn't be "played for patsies," as a White House official said. And the French and others finally "understood the ground rule is you've got to help" in Iraq. The result: They began to help, welcoming Baker and promising to forgive some or all of the Iraqi debt amassed by Saddam.

The White House has refrained from gloating. "We're happy with success, but we're looking forward" to 2004, Bush adviser Karl Rove said. Bush has a theme, the "ownership society," and a fat agenda that includes "lifetime savings accounts"--essentially tax-free IRAs with no penalties for withdrawal--and Social Security investment accounts. Bush's idea is to give Americans ownership of their money for retirement, health care, and everything now in the hands of government or other providers. Achieving all this would be a major feat, almost as amazing as what Bush wrought in late 2003.

> ...but I'd include that so-called/"double" taxation/of dividend stuff./It set a precedent for/ignoring concepts ...
>>I'm not familiar with this. What is it called (so I can research it)?

The web's full of stuff,
most of it emotional
and political.

To my eyes, the most
rational assessment came
from the left-wing Slate:

"... The chief argument of those who advocate eliminating taxes on dividends is that they are subject to "double taxation." Shareholders pay taxes on dividends at the rate their ordinary income is taxed. And corporations cannot deduct dividends from their taxable income, meaning they pay taxes on them, too. Does that mean that dividends are double taxed? Only if you subscribe to the belief that corporations don't pay taxes, people do. Under this theory, since a company's profits are ultimately distributed to owners and shareholders in some form—dividends, profit sharing, salaries, or capital gains—any tax on corporate income, or any limits on the deductibility of items from taxable income, in effect taxes the same dollar of profits twice. This only makes sense if, like Treasury Secretary Paul O'Neill, you don't draw a distinction between a corporation and the people who own it. "The corporations and businesses are just an intermediary between the citizens and the government," he said in an interview last year. (The logic of this dogma naturally leads its faithful to advocate abolishing the corporate income tax, as O'Neill does.)

"But the double-taxation argument reflects a flawed understanding of what corporations do and why they are formed. Corporations are distinct entities. They are not merely passive conduits of cash. They are legal beings, chartered by states to perform certain objectives. They possess all sorts of prerogatives, rights, and protections not afforded to individuals. That's why people form corporations, and that's why it is just for corporations to pay taxes on their income. Too frequently, CEOs like O'Neill have failed to differentiate between themselves as individual citizens and the companies they run. (That may explain why Tyco's Dennis Kozlowski and Enron's Kenneth Lay thought there was nothing untoward about using their corporate treasuries as ATM machines.) ..."
[The Dividend Double-Tax Deception, By Daniel Gross, Aug. 8, 2002]

There were lots of threads,
but I remember most as
hand-waving and flames.

If you search around,
you'll find lots of stuff. Taxes
are bad, that's for sure,

but the rhetoric
that got these taxes cut out
was too weird for words.

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