“The Nakedly Transparent Flouting Of The Tax Laws”: Washington Misses The Point On The Tea Party And The IRS
My pixels have been absent from these precincts while I report a feature story for The Nation, and I’ll have more to say about the ersatz Scandalpalooza being ginned up by Republicans this week, but for now I wanted to drop a quick word about just how overblown the outrage is about the Internal Revenue Service flagging groups with “Tea Party” in their name for extra scrutiny when they apply for 501(c)(4) status. Jeffrey Toobin, in a New Yorker post called “The Real I.R.S. Scandal,” succinctly explains the legal background:
It’s important to review why the Tea Party groups were petitioning the I.R.S. anyway. They were seeking approval to operate under section 501(c)(4) of the Internal Revenue Code. This would require them to be “social welfare,” not political, operations. There are significant advantages to being a 501(c)(4). These groups don’t pay taxes; they don’t have to disclose their donors—unlike traditional political organizations, such as political-action committees. In return for the tax advantage and the secrecy, the 501(c)(4) organizations must refrain from traditional partisan political activity, like endorsing candidates….
Particularly leading up to the 2012 elections, many conservative organizations, nominally 501(c)(4)s, were all but explicitly political in their work. In every meaningful sense, groups like Americans for Prosperity were operating as units of the Republican Party. Democrats organized similar operations, but on a much smaller scale. (They undoubtedly would have done more, but they lacked the Republican base for funding such efforts.)
So the scandal—the real scandal—is that 501(c)(4) groups have been engaged in political activity in such a sustained and open way.
Just how sustained and open a way? Well, in June of last year I reported from the closing weekend of the recall campaign against Republican governor Scott Walker of Wisconsin:
I drive to a microscopic town next to Racine, where a giant open field was a stop on the bus tour in which Americans for Prosperity, the fake grassroots group that fronts for the Koch Brothers, was shipping supporters from, among other places, Illinois, to these here rallies around the state. Not, they claim, to support the Walker campaign—that would violate election law—which they had nothing to do with, but just in the interest of “educating folks in the importance of the reforms.”
The three hundred or so (though National Review counts differently than me) white people—and one black, who stood precisely in the center of the front row and wore an AFP staff T-shirt—heard an AFP staffer hosanna “economic freedom, limited government, and lower taxes.” And that “even Barack Obama’s Bureau of Labor Statistics” said “we’ve created jobs in Wisconsin.” Then he introduced as an “honorary Wisconsinite,” the head of Americans for Prosperity—Wisconsin, Tim Phillips—a Southerner who made a joke about frigid weather. Apparently reverse carpet-bagging is a signal feature of this “grassroots” movement.
Then a third speaker, but I had already wandered off, bored by the conspicuous lack of energy, past a sign reading “Republican’s Are Makers Democrats Are Takers” [sic, of course], and tables featuring free DVDs on both the glories of Scott Walker and the United Nation’s plan to enslave the United States, in the direction of a second, entirely separate, stage across the field put up by the Racine Tea Party. A few minutes later, the rest of the crowd followed me there. For, yes, an entirely separate rally, which had “nothing” to do with the nonpartisan one two hundred yards away that had just ended [wink wink, nudge nudge]. There they heard Walker’s running mate Rebecca Kleefisch rant about the “big union bosses from out of state,” and how the unions were just like Goliath, and her boss was exactly like David.
Me, I fingered my slick Americans for Prosperity—Wisconsin flier, which I later noticed contained the most revealing typo in the history of politics. “The forces of BIG GOVERNMENT would like nothing more than for you to DO NOTHING,” it warned, but promised, “We are gathering citizens together from across Michigan to make phone calls, knock on doors and educate their friends, family and neighbors.”
As Toobin points out, this is the real scandal: the nakedly transparent flouting of the tax laws by groups claiming to be nonpolitical and nonpartisan. Count on the media in Washington to entirely miss that obvious point.
By: Rick Perlstein, The Nation, May 16, 2013
“The Media Has Cast Its Traditional Role Aside”: Washington Circus Steals The Spotlight From Where It Belongs
Can President Barack Obama put out the brush fires that are sucking the air out of his second-term agenda? Can he stop the spread of mini-scandals that are consuming Washington?
No, he cannot. The president could (unconstitutionally) shutter every Internal Revenue Service office and fire every staffer, from top-ranking executives to lowly administrative aides, and it would hardly matter. Republicans would simply change the terms of the debate and impeach him for destroying the 16th Amendment.
Official Washington is now all spectacle, all circus, all manufactured outrage abetted by a press corps addicted to controversy. Actual policies are slighted while political posturing takes the stage; simmering problems are ignored while canned contretemps and stale theater consume all the attention. That has been true for years now, but it just keeps getting worse.
There are serious failings at the heart of each of the sideshows currently consuming officialdom. The most egregious concerns the IRS, where bureaucrats singled out conservative groups for a vetting that veered into political harassment. That not only violates deep-rooted ideals of fairness and justice, but it also contravenes federal law. It raises the specter of the sort of political harassment carried out by Richard Nixon, who wielded the IRS as a bludgeon against his political adversaries, and by J. Edgar Hoover, who ordered tax audits of the Rev. Martin Luther King Jr.
While IRS-gate reflects poorly on Obama’s leadership, there is not a scintilla of evidence that he had anything to do with it. Further, the president has responded with aplomb: He has forced the resignation of the acting head of the agency as the FBI launches a criminal investigation. (That’s about all the administration can do since federal rules insulate IRS bureaucrats from elected officials, all in an effort to prevent scandals such as those mentioned above.)
If Republicans doubt the president’s ability to impartially oversee an investigation of his own administration, they might appoint a special prosecutor. Instead, they have promised more hearings on Capitol Hill — more partisan spectacle, more canned outrage, more useless theater.
Though the national press corps sticks to its unwritten rule of blaming Democrats and Republicans equally for the mess our national politics have become, the facts show that responsibility cannot be equally apportioned. Democrats don’t eschew partisan mudslinging, but they are not very good at it. The GOP, by contrast, has raised it to an art form.
Take a look at the last two presidential administrations. Though Bill Clinton reigned over an era of peace, prosperity and a balanced budget, the GOP impeached him on charges that grew out of an adulterous affair. George W. Bush took the country to war on the wings of a lie, tortured detainees and wrecked the budget. Democrats pointed fingers and conducted investigations, but they did not impeach him.
The news media, meanwhile, breathlessly report every email, every accusation, every pointed finger. They parse political winners and losers. Will the Benghazi hearings damage Hillary Clinton’s chances for the presidency in 2016? Will the IRS controversy hurt immigration reform? Will the controversies heal Republicans’ internal divisions?
As much as it troubles me to say so, Washington journalists have cast aside their traditional roles as trumpets of a substantive truth. They rarely uncover genuine abuses of power, cast a skeptical eye on untoward developments (such as the warmongering that led to the invasion of Iraq) or even explain the nuances of policy. Heck, they barely bother to inform the public when yesterday’s huge scandal becomes suddenly less, well, scandalous.
Take the budget deficits. Wasn’t it just two months ago that Republicans were insisting that the Obama administration was sending the entire nation to the poorhouse? What happened to those deficits?
As it turns out, they are shrinking, just as many mainstream economists had predicted. As the economy recovers, the federal government pays out less in assistance and takes in more in taxes.
You haven’t heard a lot of chatter about that or about the people hurt by the continuing cuts that were supposedly made necessary by that looming deficit. Many struggling Americans are finding their childcare options limited, their community clinics closed, their assistance for housing and meals shrinking — with little notice from official Washington. That’s the real scandal.
By: Cynthia Tucker, The National Memo, May 18, 2013
“Pick A Narrative And Go With It”: Lazy, Incoherent And Contradictory Political Media Critiques
Regular readers may recall that I’ve long been fascinated by the trouble President Obama’s detractors have had with understanding what it is about him they dislike. The result is a series of rhetorical attacks that are incoherent and contradictory.
He’s a ruthless Chicago thug and a “wuss.” He’s a bystander who goes golfing too much and an activist president who engages too much. He’s sticking to the Bush/Cheney script on national security and he’s putting us at risk by abandoning the Bush/Cheney national security agenda. He’s cutting cherished entitlement programs like Medicare and he refuses to cut entitlement programs like Medicare. He’s waging a class war against the rich and he’s coddling millionaires.
This week, as much of the political world tries to stick to the dubious line that the White House is engulfed in scandals, we’re seeing the same phenomenon once more. Greg Sargent makes a nice catch this afternoon:
One current storyline has it that all of these stories could converge to create a sense that Obama’s embrace of government activism has shaded into Nixonian abuses of power — revealing that Obama personally harbors a far more intrusive, overbearing, and even sinister approach to governing than he previously let on.
But another current storyline has it that the White House’s pushback on these scandals — the claims of a firewall between the Justice Department and the White House, the assertions of no connection to the IRS abuses — reveal a president who is weak and unable to control the government he presides over.
Good point. Just today, the Washington Post reports that the recent uproars “add evidence” to detractors’ claims that President Obama is a power-hungry leader who “has not acted within the constraints of the Constitution.” And also today, the New York Times reports that the controversies that have captured the Beltway’s attention present President Obama as a helpless “onlooker” who seems unable to “use his office.”
Greg added, “Obviously, these narratives can’t both be true at once. The scandals can’t demonstrate that Obama’s true dictatorial streak has finally been revealed while simultaneously supporting the idea that they’ve shown him to be too weak to control a government that has run amok.”
Ordinarily, I give the “pick a narrative and go with it” advice to the president’s Republican detractors, but in this case, it seems more appropriate to remind pundits and the political media establishment that their own preconceived narratives are just as contradictory.
Indeed, in this case, the critiques are especially incoherent since the so-called “scandals” generating so much chatter about “a White House in crisis” don’t actually relate much to the White House. None of the stories — Benghazi, the IRS, AP subpoenas — points to a tyrannical dictator or a hapless onlooker.
To connect three disparate stories of varying degrees of legitimacy and importance into a mega-scandal is lazy. So, too, is the embrace of competing narratives that cancel each other out.
By: Steve Benen, The Maddow Blog, May 16, 2013
“Doing More With Less”: Outgoing IRS Chief Blames Underfunding For ‘Foolish’ Mistakes
Testifying in front of the House Ways and Means Committee, acting IRS commissioner Steve Miller apologized for his agency Friday.
“I want to apologize on behalf of the Internal Revenue Service for the mistakes that we made and the poor service that we provided,” Miller said. “The affected organizations and the American public deserve better.”
Agents at the IRS decided to take a shortcut in 2010 that has created an uproar, “centralizing” a number of factors that could raise suspicions that these fledgling non-profits might not be focused primarily on ”social welfare.” One of those factors — and here’s where they made their biggest mistake — was focusing on groups with “Tea Party” or “Patriot” in their names. Later they revised this policy to focus on “political action-type organizations involved in limiting/expanding government, educating on the Constitution and Bill of Rights, social economic reform movement,” according to the IRS Inspector General’s report.
The result? Some 300 groups were identified for extra scrutiny — among them, 70 were Tea Party groups. It’s not clear how many groups were turned down, yet it’s clear at least one Democratic group was.
Miller — who is stepping down from his position at the request of the administration — insisted that the actions were not intended to target conservatives.
“I think that what happened here was that foolish mistakes were made by people trying to be more efficient in their workload selection,” he said. “The listing described in the report, while intolerable, was a mistake, and not an act of partisanship.”
Under questioning by Rep. Paul Ryan (R-WI), Miller pointed out that though progressive groups were not identified by name, the IRS actually collected more information on left-leaning groups than Tea Party groups. The lifelong bureaucrat even rejected the notion that his agency was “targeting” anyone, insisting that was a pejorative term to describe the “listing” the agents were doing.
Republicans continually tied the scandal to attacks on the IRS in general, often citing audits by their supporters as proof of the agency’s overreach.
“The reality is this is not a personnel problem. This is a problem of the IRS being too large, too powerful, too intrusive and too abusive of honest, hardworking taxpayers,” said Rep. Dave Camp (R-MI).
But Miller had another explanation for why his agents pursued such questionable practices — funding. The commissioner asked the committee to increase funding to his agency, citing budget constraints as a major reason why agents sought shortcuts to identify questionable applications.
“In the last 10 years, the budget of the IRS, adjusted for the size of the population and inflation, has come down 17 percent,” according to tax expert David Cay Johnston.
Committee members offered several examples of groups being denied 401(c)(4) status or delayed endlessly. However, there’s no evidence that suggests Republican spending was hindered by this IRS’s shortcut.
“Of the 21 organizations that received rulings from the IRS after January 1, 2010, and filed FEC reports in 2010 or 2012, 13 were conservative,” writes OpenSecretsblog‘ Robert Maguire. ”They outspent the liberal groups in that category by a factor of nearly 34-to-1, the Center for Responsive Politics analysis shows.”
By: Jason Sattler, The National Memo, May 17, 2013
“The Real IRS Scandal”: Lawmakers Who Pushed The Agency To Rely On Bone-Headed Tactics By Refusing To Fund It To Do Its Job
David Simon, of “The Wire” fame, once responded to the idea of “doing more with less” by saying, “That’s the bullshit of bean counters who care only about the bottom line. You do less with less.” For the Internal Revenue Service, the line should perhaps be updated to “you do less with less, and also cause a scandal.”
The IRS, of course, was recently caught singling out conservative groups seeking tax-exempt status for extra scrutiny. IRS employees in a Cincinnati office used search terms such as “tea party” and “patriot” to find organizations they deemed worthy of more attention in their request to be exempted from paying federal taxes. (The irony of tea party groups complaining about not getting effectively subsidized by the government in a timely enough fashion will be left for another time.)
The “scandal” has already caused the acting commissioner of the IRS to lose his job and prompted a hearing on Capitol Hill Friday during which lawmakers expressed their outrage that the tax agency could act in such a manner. But Congress deserves its own share of blame for the debacle.
Now, the IRS employees who were searching for “tea party” surely should have known better. But the fact of the matter is that the agency has been dealing with a deluge of applications for tax-exempt status at a time when its budget is shrinking. The size of the IRS workforce has dropped 9 percent from its 2010 level, and the agency has seen its budget cut in each of the last two fiscal years. This fiscal year, the amount the IRS spends per capita (meaning per citizen) will be 20 percent lower than it was in 2002, according to an analysis by tax expert David Cay Johnston.
Meanwhile, as Reuters reported, “The IRS has seen the number of groups applying for 501(c)4 status double in the wake of a January 2010 Supreme Court decision that loosened campaign-finance rules.” The Obama administration has requested budget increases for the IRS, but Republicans in Congress refuse to approve them. So it’s perhaps not surprising that already overworked employees at the agency looked for a few shortcuts.
And things are likely not going to get any better this summer when the IRS shuts down entirely for five days due to budget cuts under the so-called “sequester.” These cuts don’t just inconvenience people who need tax assistance; they cost the Treasury money. The IRS estimates that every dollar spent on enforcement brings in $4 to $5 in additional revenue, so cutting the IRS budget is akin to the government cutting off its nose to spite its face.
My colleague Robert Schlesinger noted today that the real scandal surrounding the attack at the U.S. diplomatic outpost in Benghazi, Libya, is not who edited which talking point when, but that the State Department was denied funds to beef up consular security. Much the same can be said for the IRS. The scandal is not about the agency’s shortcuts, but the lawmakers who pushed it towards relying on bone-headed tactics by refusing to give it the money it needs to do its job.
By: Pat Garofalo, U. S. News and World Report, May 17, 2013
Share This Blog
Unknown Feed- An error has occurred; the feed is probably down. Try again later.
mykeystrokes.com 