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"It makes sense that he simply lied on his application to get scholarship funds"

But there is so much more. What about the Selective Service registration and his Social Security number?

Whatever the truth is will eventually come out regardless of what I think. What will remain is that he is an utterly contemptible fraud and liar. That won’t change.

My guess is that Obama could not endure registering for the selective service. That was a brand new requirement in 1980, when he would have been entering his sophomore year. Anti-Vietnam war and anti-military sentiment was still strong in the college-going social classes - there was fear, outrage, resentment - I remember even though I was exempt, being female. Now it's much more routine, one form among dozens.

Under current law, all male U.S. citizens are required to register with Selective Service within 30 days of their 18th birthday. In addition, foreign males between the ages of 18 and 25 living in the United States must register. This includes permanent residents (holders of Green Cards), refugees, asylees, dual citizens, and illegal immigrants.[2] Foreign males in the United States as lawful non-immigrants (international students, visitors, diplomats, etc.) are not required to register.

Source: Wikipedia

I believe at that time he claimed exemption to Columbia U. as an Indonesian citizen because of his adoption by Soetoro, without dual citizenship. Possibly he even claimed Kenyan birth at that time. Hence the dubious-looking selective service registration form that has been released.

The social security number would never have been a problem - there seems always to have been a sufficient paper trail of a Hawaiian birth for him (or his grandmother on his behalf) to apply for one.

My take is that he was born in Hawaii, lied about it sometimes to glamorize himself, and denied being a US citizen when it was convenient.