IRS Scandal Strikes a Severe Blow to Big Government

IRS Scandal Strikes a Severe Blow to Big Government


Right now, we have what’s usually called a “target-rich environment” in politics for pundits and scandal investigators.  Want a White House scandal to probe?

Take a look at the 12-revisions of the Benghazi talking points, which resulted in such nonsense that CIA Director David Petraeus declared them “useless” the day before Susan Rice broadcast them on five different Sunday talk shows last September. 

The ‘scrubbing’ managed to remove any references to a terrorist attack while the Obama administration continued to press the narrative that the attack had resulted from demonstrations over a YouTube video.  That assertion caused the State Department’s deputy chief of mission in Libya Greg Hicks’ jaw to drop when he heard the claim.

Members of the media might find the revelation that the Department of Justice seized the phone records of the Associated Press a little juicier, and certainly more self-relevant. The DOJ wanted to probe the leak of a foiled bomb plot involving al-Qaeda to determine the source of the story, which Attorney General Eric Holder insisted did damage to American intelligence and put people in danger.  In fact, it was so dangerous that rather than follow the regulatory guidelines for subpoenaing media records in leak investigations, Holder’s deputy AG James Cole went after the phone records of three Associated Press offices and as many as 100 reporters over a two-month period. 

That might not be the last of it, either. Holder told NPR that he couldn’t count offhand the number of times he approved seizing media records secretly, although he did offer an encouraging aside that he didn’t approve “a few” of those requests from Justice.  Whew!

The scandal that will probably matter most to Americans, however, is the IRS scandal – and not just because we all have to pay taxes through the agency, either.  The Inspector General for the Treasury investigated years-long complaints that the IRS had subjected Tea Party and other conservative groups applying for tax-exempt status to extra scrutiny for political purposes, amounting to harassment.  A report that finally dropped this week showed that IRS agents in four different offices, including the agency’s Washington DC headquarters, coordinated efforts to seek out applications from conservative groups as early as March 2010.  They asked intrusive questions and made ridiculous demands that kept the groups from getting approval as tax-exempt organizations for 27 months.

Among the questions:

• Please provide copies of all your current web pages, including your Blog posts. Please provide copies of all of your newsletters, bulletins, flyers, or any other media or literature you have disseminated to your members or others. Please provide copies of stories and articles that have been published about you.
• Do your issue-related advocacy communications compare to the positions of candidates or slates of candidates on these issues with your positions? Provide copies of these communications. What percentage do these constitute of your issue-related advocacy communications?
• Apart from your responses to the preceding, estimate the percentage of your time and what percentage of your resources you will devote to activities in the 2012 election cycle, in which you will explicitly or implicitly support or oppose a candidate, candidates or slates of candidates, for public office.

The absurdity and obstructionism of just these questions are obvious, and there are many more on ABC’s report.  What, for instance, does it mean to “implicitly support” a candidate? Do only those organizations whose issue-related communications don’t match that of any politicians qualify for tax-exempt status? The document demands alone are so ambiguous as to be unrealistic, and entirely useless anyway, as no one would expect an IRS agent to read all of what was requested.

How effective was the IRS scrutiny?  USA Today looked through the data in the IG report and found that in 27 months after February 2010 – just before this strategy was put into practice – no conservative groups managed to get approval for their applications.  On the other hand, “the IRS approved perhaps dozens of applications from similar liberal and progressive groups,” USA Today found.  Political themes mattered a lot less for those groups, too: “With names including words like “Progress” or “Progressive,” the liberal groups applied for the same tax status and were engaged in the same kinds of activities as the conservative groups.”

Nor is that the only issue with the IRS and potential politicization.  A prominent donor to the Mitt Romney campaign, Frank Vandersloot, revealed yesterday that after donating to Romney (and being attacked by the Obama campaign as being “less-than-reputable”), he was targeted for not just one but two IRS audits, plus a Department of Labor audit. 

Vandersloot claims that more Romney donors also got the IRS audit treatment during the 2012 campaign, but are understandably reluctant to come forward. Franklin Graham, the son of legendary evangelist Billy Graham and the man running the family’s ministries also claims that the IRS targeted his organization for political purposes during the presidential campaign, costing them over $80,000 and lots of wasted time. 

One of the offices of the IRS handling the tax-exempt requests also leaked nine confidential files in progress to the liberal watchdog site ProPublica, according to ProPublica itself.

Americans who believe that the IRS should enforce its regulations neutrally already have plenty of reason for concern, if not outrage. They should be concerned about the fact that the IRS is about to get a lot more powerful through the Affordable Care Act, better known as Obamacare. 

The law makes the IRS the enforcement agent for the individual mandate and health-plan acceptability, and that power can be perverted for political purposes.  As Byron York points out at the Washington Examiner, the IRS is also in charge of determining eligibility for Obamacare subsidies, which means they will have much more intimate knowledge of our lives than ever before:

“The law authorizes the IRS to share confidential taxpayer information with the Department of Health and Human Services for the purpose of determining those subsidies,” York reminds us. “In addition, the IRS will keep track of even the smallest changes in Americans' financial condition. Did you get a raise recently? You'll need to notify the IRS; it might affect your subsidy status. Have your hours been reduced at work? Notify the IRS. Change jobs? Same.”

Now consider what may happen when all of this intimate detail ends up in the hands of a politicized IRS, as happened over the last three years.  Newt Gingrich asked Monday, “Why would you trust the bureaucracy with your health if you can't trust the bureaucracy with your politics?"

It’s a good question.  Undoubtedly, it’s one of the questions that a certain-to-be-revitalized Tea Party will be asking, especially since the IRS proved every warning the grassroots conservatives have about the dangers of big government.  This scandal has the potential to deliver a crippling blow to the cult of big government, thanks to the behavior of big government itself.