FORTUNE -- Sen. Ron Johnson -- not to be confused with the Ron Johnson who created the Genius Bar -- gets a lot of heat from liberals in his home state for his positions on abortion (he's against it), same sex marriage (ditto), global warming (caused by sun spots) and the Violence Against Women Act (unconstitutional).
There's even a Tumbler page where Jonson's constituents can explore his views on everything from gun control to social security.
It's called Our Dumb Senator.
But at the Senate subcommittee hearing on Apple's (AAPL) taxes Tuesday, the Tea Party candidate from Wisconsin was anything but dumb. In fact, he asked smarter questions that elicited more information about Apple's operations than all the other senators combined. (See C-Span clip below.)
It helped, perhaps, that his background is in business (accountant, night-school MBA program, CEO of a plastics manufacturer) not law or politics.
But if he'd been a little more probing and little less pro-business, he might not have missed an opening as big as Irish loophole. He was quizzing Phillip Bullock, Apple's chief tax guy, about the Internal Revenue Service:
Johnson: "My guess is you have full-time IRS agents stationed in your operation basically doing a full-time audit nonstop, is that pretty accurate?"
Bullock: "That's correct..."
Johnson: "And they're looking at all this corporate structure, they're looking at all the transfer prices, and they're basically giving you the nod and saying you're following tax law?"
Bullock: "They look at it in detail, yes."
Wait a minute! The IRS hardly gave Apple "the nod." A follow-up question might have elicited the fact (spelled out in the company's annual report) that Apple is in an ongoing battle with the IRS over "certain undistributed foreign earnings" -- the very issue at the heart of the hearings.
Apple's Form 10-K for fiscal 2012 goes on to say:
"The Internal Revenue Service (the "IRS") has completed its field audit of the Company's federal income tax returns for the years 2004 through 2006 and proposed certain adjustments. The Company has contested certain of these adjustments through the IRS Appeals Office. The IRS is currently examining the years 2007 through 2009. All IRS audit issues for years prior to 2004 have been resolved. In addition, the Company is subject to audits by state, local, and foreign tax authorities. Management believes that adequate provisions have been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty."
Sen. Johnson's portion of the Apple hearings:
Reporters wrote two kinds of second-day stories, with two very different takes.
FORTUNE -- A search of Google News the day after Tim Cook's Senate testimony on Apple's (AAPL) taxes turned up two kinds of stories.
Headlines reporting on the fact of the hearing tended to use metaphors of violence ("rip," "lambaste," "clash," "spar," "fend off") or of high-temperature torture ("grilled," "hot seat").
But the journalists who reported on the atmospherics -- and, MOREPhilip Elmer-DeWitt - May 22, 2013 10:14 AM ET
No one laid a glove on Apple's CEO, not even the subcommittee's hostile chairman.
FORTUNE -- In February, the Huffington Post's Jason Gilbert reviewed the performance of Apple (AAPL) shares on days that Tim Cook spoke in public and concluded, as his headline put it,
The Last 6 Times Tim Cook Has Talked, Apple's Stock Has Dropped.
So it was with some trepidation that Apple investors tuned in to C-Span.org Tuesday morning to watch Cook's MOREPhilip Elmer-DeWitt - May 21, 2013 3:05 PM ET
The junior senator from Kentucky has been tweeting up a storm in Apple's defense.
FORTUNE -- In subcommittee hearings Tuesday, Senators Carl Levin and John McCain were careful to balance praise for Apple's (AAPL) achievements with outrage over its "convoluted and pernicious" (McCain's words) tax avoidance strategies.
Sen. Rand Paul showed no such balance. He lit into his own committee's leadership for "dragging" one of America's great success stories into what he MOREPhilip Elmer-DeWitt - May 21, 2013 11:10 AM ET
C-Span.org began coverage at 9:30 a.m. Tim Cook is scheduled to appear in Part 2.
FORTUNE -- If the subcommittee report is any indication, Tim Cook and his colleagues will face tough questions Tuesday from Sens. Carl Levin (Dem.) and John McCain's (Rep.) Permanent Subcommittee on Investigations.
The report charges that Apple (AAPL) avoided paying roughly $10 billion in U.S. taxes a year by funneling foreign income through a series of Irish MOREPhilip Elmer-DeWitt - May 21, 2013 9:30 AM ET
It's a good thing for Apple that most people won't read the Senate subcommittee's report.
FORTUNE -- The 40-page case study on Apple's (AAPL) overseas tax strategies submitted by the Senate's Permanent Subcommittee on Investigations Monday is not an easy read.
The 10-page overview of tax principles and law in the middle -- a history of how a program to block the use of offshore tax havens begun by President Kennedy was MOREPhilip Elmer-DeWitt - May 21, 2013 7:33 AM ET
The results of its probe of Apple's offshore taxes are now available online.
FORTUNE: By Monday afternoon, the day before Tim Cook's scheduled appearance before the Senate Permanent Subcommittee on Investigation, both sides of the story were available online as PDFs: Apple's (AAPL) 17 pages of airbrushed testimony and the subcommitee staff's blistering 40-page retort.
As reader Jim Neal puts it: "Anybody who thinks this is going to be a cordial exchange of ideas MOREPhilip Elmer-DeWitt - May 20, 2013 7:05 PM ET
In a statement to the Senate, Apple explains -- sort of -- what it's doing in Cork.
FORTUNE -- There are three parts to the 17-page testimony Apple (AAPL) submitted Monday afternoon in advance of Tim Cook's appearance before the Senate Permanent Subcommitee on Investigations, scheduled for Tuesday:
The easy part: A recitation of how much Apple pays in Federal taxes ($6 billion in fiscal 2012), the number of jobs it has created MOREPhilip Elmer-DeWitt - May 20, 2013 5:08 PM ET
A suicide story that broke on Saturday had fallen apart by Monday.
FORTUNE -- The Agence France Press headline that moved over the business wires Saturday morning seemed like deja vu all over again:
Three new factory suicides at Apple supplier Foxconn
Citing only a statement issued by China Labor Watch in New York, the news agency reported that the deaths occurred at a Foxconn factory in the central city of Zhengzhou and MOREPhilip Elmer-DeWitt - May 20, 2013 12:37 PM ET
Sees the Inverse Head and Shoulders pattern he's been waiting for.
FORTUNE -- Gotta love these technical analysts.
As William Meade pointed out in Saturday's ETF Daily News post, he never once mentioned Apple's (AAPL) fundamentals during the three months that he was advising his readers -- mostly hedge fund managers -- to sell sell sell.
Now the president of Pure Alpha Research (and former research director at Zacks in Chicago) has changed his MOREPhilip Elmer-DeWitt - May 20, 2013 10:14 AM ET
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