“An Untenable Position”: How John Boehner And Republicans Helped Create The IRS Scandal
The political powers the IRS was recently accused of abusing to harass Tea Party groups were given to it against its will by Congress — including some of the agency’s biggest critics today — over 10 years ago, according to documents and a former senior tax official. The revelation, which has been missing in most if not all of the commentary on the scandal, adds a key bit of context to it.
In a half-measure effort to strengthen campaign finance disclosure laws in 2000, Congress put the IRS, effectively for the first time, in the awkward position of having to make judgment calls about whether nonprofit advocacy groups would be required to disclose their donors because too much of their activities crossed the theoretical line between “issues advocacy” and “political campaign intervention.” It’s a messy and inherently subjective business, and something officials did not want to get more involved in, predicting it would lead to exactly the kind of controversy we just witnessed. “The IRS would inevitably be subject to claims of discrimination and political bias for actions taken or not taken,” an internal memo from the Treasury Department’s office of Tax Policy sent in June 2000 and obtained by Salon reads.
“The fuse was lit in 2000 with this law, which put the IRS in an untenable position. It’s almost surprising it didn’t explode on them earlier,” Steven Arkin, a former senior Treasury and IRS official, who proceeded Lois Lerner as the director of rulings and agreements for the IRS’ tax exempt organizations office, told Salon.
The law, a stand-alone bill numbered H.R.4762, had the best of intentions, but backfired thanks to an enormous loophole. After a comprehensive campaign finance bill failed, reformers pushed a narrow bill to increase disclosure of groups organized under section 527 of the tax code. That was reserved for groups primarily involved in electoral politics — but before this law, 527s that didn’t engage in explicit electoral intervention didn’t have to file any paperwork of any kind with the IRS. They incorporated as legal entities in their states, and that was that. No information on donors, expenditures or even their existence needed to be made public. If they did engage in electioneering, they would have to disclose that information to the FEC, but only for each specific activity. Thanks to the lax standards, these groups earned the moniker “Stealth PACs” and became the bane of campaign finance reform advocates.
When lawmakers brought up a bill to force 527 groups to disclose their donors just before Congress was about to go on its July 4 recess in 2000, they made a concession to skeptical Republicans and some Democrats who were looking out for liberal nonprofits: 501(c) groups — business leagues and the so-called social welfare organizations at the center of this year’s IRS controversy — would not be included. This didn’t seem like a big deal at the time, since almost everyone who wanted to meddle in politics organized as a 527 and not a 501(c)4. Both types of groups are tax-exempt, but 527′s had free rein to engage in electoral politics, while 501(c)4′s are limited to spending less than half their money on it. Social welfare and other groups are permitted to engage in unlimited issue advocacy, so long as their efforts to elect or defeat particular candidates were not their “primary” activity.
But former Sen. Russ Feingold, a staunch campaign finance reform advocate, saw what would happen if you cracked down on 527′s and not 501(c)4′s. “By only focusing on disclosure in one type of tax-exempt organization and not on others, we leave open the use of the other type of tax-exempt organizations by those who want to hide their contributions and activity behind the cloak of anonymity that these tax-exempt organizations provide,” Feingold warned on the floor during the Senate’s very short debate. He added that he was concerned that the IRS was “not prepared” to take on this burden, given the administration’s concern.
Sen. John McCain, the Senate sponsor, said that while it would be nice to do all groups, “focusing narrowly on 527 organizations” was necessary to “ensure that the legislation survives a constitutional test.” In the House, Wisconsin Democrat Tom Barrett, acknowledged that “this bill is not perfect” since it exempted social welfare organizations, but said including them might be “poison pill provisions” that would “scuttle this important reform effort.”
The bill passed overwhelmingly in both chambers. In the House, it was 385-39, with the “yay” column including Republican Reps. John Boehner, Dave Camp, Paul Ryan, Jim DeMint and many others who would later make hay of the way the IRS regulated 501(c) groups. Meanwhile, the Senate approved it 92-6, with McCain, Lindsey Graham, Rick Santorum and many others voting in favor. Sen. Mitch McConnell, a longtime opponent of campaign finance reform, voted no, but said, “I recommend to my Republican colleagues that they vote for this bill,” calling it “relatively benign and harmless.”
The fallout was not particularly surprising. Two months after the law went into effect, the Washington Post reported that “instead of complying with the new law, a number of groups are instead reconstituting themselves under other provisions of the tax code that do not force them to reveal their donors.” Ben Ginsberg, a prominent GOP election lawyer, told the Post he couldn’t keep up with with his clients’ requests to convert. “We’d be running out of fingers and toes” just to count them all, he said. Claiming to be new groups, they reorganized as 501(c)4′s, which can do basically all the same things the old 527′s did, just under a different section of the tax code. So in the end, Congress swapped out 527 “Stealth PACs” for 501(c)4 “Dark Money” groups.
But while the change seems banal, it effectively transferred oversight of this species in the campaign finance ecology to the IRS, an agency less well equipped to handle delicate political questions than the FEC, which was designed with a bipartisan commission and other features precisely to handle touchy political issues, including fundraising matters impacting members of Congress themselves.
“The proposals to amend the Internal Revenue Code would put the IRS in the position where it, rather than the FEC, must become the “watchdog,” the Treasury Department memo, first reported by Sam Stein at the Huffington Post, warned before the law passed. “Imposition of such a burden on the IRS would be an administrative nightmare for the agency.”
“It never should have been given to the IRS,” said Arkin, the former tax official.
It’s a fitting coda to the IRS scandal that the problem was largely created by the people most outraged by it.
By: Alex Seitz-Wald, Salon, July 11, 2013
“The Self Delusional Party Of No”: Carrying On As If Whistling Past The Graveyard Were A Plan
Self-delusion is a sad spectacle. Watching Republicans convince themselves that killing immigration reform actually helps the GOP is excruciating, and I wish somebody would make it stop.
House Speaker John Boehner’s unruly caucus has been busy persuading itself not to accept or even modify the bipartisan immigration bill passed by the Senate. Rather, it wants to annihilate it. It’s not that these Republicans want a different kind of comprehensive reform; it’s that they don’t want comprehensive reform at all.
The Obama administration “cannot be trusted to deliver on its promises to secure the border and enforce laws as part of a single, massive bill,” Boehner (R-Ohio) and the GOP leadership said in a statement. Instead, the idea is supposedly to deal with the tightly woven knot of immigration issues one at a time.
That’s like sitting down with a piece of cake and saying, “First I’m going to eat the flour, then the sugar, then the eggs.”
House Republicans think they can begin with “border security,” which would be laughable if the need for real immigration reform were not so serious. It is ridiculous to think the nearly 2,000-mile border between the United States and Mexico can be made impregnable.
The border, after all, was judged 84 percent secure last year by the Government Accountability Office — meaning that only 16 percent of attempts to enter the country illegally from Mexico were successful. Any improvement, at this point, would necessarily be fairly modest. Perhaps Republicans know of a border somewhere in the world that is 100 percent secure. I don’t.
And never mind that the flow of undocumented migrants is way down from its peak, while apprehensions of would-be migrants are way up. According to the nonpartisan Congressional Budget Office, the Senate bill, if enacted, could slash illegal immigration in half. No realistic increase in border security would do as much.
So the House Republicans’ intransigence isn’t really about the border. It’s about avoiding the central question, which is what to do about the 11 million undocumented migrants who are here already.
In the view that has become far-right dogma, giving these people a path to citizenship “rewards bad behavior” and puts them ahead of presumably well-behaved foreigners who are waiting “in line” for admittance. For the most adamant House Republicans, giving the undocumented any legal status and permission to stay would amount to “amnesty.”
No legal status, of course, means no solution. Opponents of comprehensive reform should just come out and say what they mean: Rather than accept measures that studies say would not only reduce illegal immigration but also boost economic growth, House Republicans would prefer to do nothing.
This makes no sense as policy or as politics. Amazingly, however, some conservatives who should know better — magazine editors Bill Kristol of the Weekly Standard and Rich Lowry of National Review — contend that the GOP would actually help itself politically by killing the Senate immigration bill.
This line of argument — I can’t call it reasoning — holds that the Senate bill must be killed because it does not end illegal immigration for all time, it does not fix the legal immigration system for all time and it is really long. The GOP should not waste time and effort chasing after Latino and Asian American votes, according to this view, and instead should concentrate on winning working-class whites with an economic message for the striving middle class.
As for the Senate bill, Kristol and Lowry wrote in a joint editorial that “House Republicans can do the country a service by putting a stake through its heart.”
Some House Republicans worry openly that giving undocumented residents a path to citizenship would eventually add millions of Democratic voters to the rolls. But they should be more concerned about the millions of Latino citizens who are unregistered or do not bother to vote. Democrats are making a concerted play for these people. Republicans are telling them they’d like to deport their relatives and friends.
Most House Republicans have nothing to worry about for the time being; their districts are safe. But the GOP’s fortunes in national contests — and eventually in statewide races — will be increasingly dim. Maybe they’ll wake up when Texas begins to change from red to blue.
In the meantime, it’s sad to see a once great political party carry on as if whistling past the graveyard were a plan.
By: Eugene Robinson, Opinion Writer, The Washington Post, July 11, 2013
“A Party That Can’t Decide To Chose”: The GOP Establishment Fractures On Immigration
Over the course of this year’s immigration debate, we’ve come to view the Republican party division as follows. On one side, advocating for comprehensive immigration reform, you have a group that is sometimes called “the establishment” or “the elite,” made up of people whose primary interest is in the party’s long-term national prospects. These are the big money people, the top consultants, some senators, and so on. On the other side, opposing comprehensive reform, you have “the base,” which is not only voters but also members of the House with a narrow interest in getting re-elected, usually by appealing to extremely conservative constituencies. On that side you also have some conservative media figures and others with strong ideological motivations against immigration reform. And then caught in the middle you’ve got the Republican congressional leadership, which can’t afford to antagonize the base but also worries about the effect killing immigration reform will have on the party.
But we may be reaching the point where these categories are no longer adequate to describe what’s going on within the GOP. This morning, William Kristol and Rich Lowry, the editors of the two most important conservative magazines (the Weekly Standard and National Review) joined together to write an unusual joint editorial titled “Kill the Bill,” coming down in opposition to the “Gang of 8” immigration bill that passed the Senate. The substance of their argument is familiar to anyone following this debate—the Obama administration can’t be trusted, it won’t stop all future illegal immigration, the bill is too long—but the substance isn’t really important. What’s important is that these two figures, about as establishment as establishment gets, are siding firmly with the anti-reform side.
Those of us who have been around for a while can’t help but be reminded of a memo Kristol wrote to Republicans 20 years ago, when Bill Clinton was trying to enact health-care reform. It argued that from a substantive and political point of view, Republicans should not try to negotiate with the Clinton administration or work with them to pass a reform that was as conservative as possible; instead, they should wage all-out war to kill it. “The plan should not be amended,” Kristol wrote, “it should be erased.”
Politically speaking, it was good advice; Republicans followed it, and they won. Sixteen years later they used the same strategy during the debate over the Affordable Care Act, and they lost.( It turned out, however, that conservative Democrats like Ben Nelson and Joe Lieberman did the Republicans’ substantive work for them, extracting a number of concessions from the administration that moved the bill in a more conservative direction). There’s a difference in this debate, however. Those two efforts at health care reform were always understood as a conflict between a Democratic administration seeking a longtime Democratic goal, and Republicans in Congress trying to stop them. It was reported like a sporting event: Clinton loses, Republicans win; Obama wins, Republicans lose. Immigration, on the other hand, has been reported largely as a battle within the Republican party. President Obama, knowing full well that anything he advocates immediately becomes toxic for most Republicans, has been using a lighter touch when it comes to public advocacy for comprehensive reform. (I’m not saying he hasn’t been pushing for it, but he hasn’t done the all-out, campaign-style barnstorming tour that would help turn it into a purely Democrats-versus-Republicans issue). The story has always been, “What will the Republicans do?” and if reform goes down, the headlines won’t read, “Obama Defeated on Immigration Reform,” they’ll read, “Republicans Kill Immigration Reform,” with subheadings like “Danger ahead for GOP as Latino voters react.”
I once knew a professor who would say to his students, “Institutions don’t speak. People speak.” His point was that we often ascribe a unified intelligence or will to things like the government or a corporation or a political party, glossing over the fact that it’s individuals making those decisions and statements. There may be a single most beneficial path for the Republican party to take, but the Republican party can’t just decide to choose it. A party is made up of lots of individuals, each with their own opinions, self-interest, and levers of influence, who will push it in one direction or another. With Kristol and Lowry coming out in opposition to reform (and perhaps other people like them to follow), it may no longer even be possible to say that the party establishment has a single position on the issue.
By: Paul Waldman, Contributing Editor, The American Prospect, July 9, 2013
“Are These People On Drugs”: House GOP Apparently Wants To Be Even More Unpopular Than It Already Is
With the July 4 holiday behind them, House members might be expected to take up work on the immigration reform bill passed by the Senate. But they won’t. They’re looking at piecemeal reforms that will be heavier on border enforcement than the Senate bill – which doubled the number of border control agents, after the border control budget already doubled in size in the last decade — and even nuttier ideas.
Instead the House GOP is apparently making big plans for another debt ceiling hostage-taking, and this time they’ve got a strategy to demand big budget cuts from President Obama and the Democrats. According to the National Journal, House leaders are working on a “menu” of budget-slashing offers to Obama in exchange for lifting the debt ceiling for a short, medium or long period of time. Their template is Rep. Paul Ryan’s budget – the budget so unjust and biased against the poor that the U.S. Conference of Catholic Bishops took time out from restricting women’s rights to criticize the Ryan plan.
House members reluctantly voted to raise the debt ceiling in January promising to come back with a strengthened hand on behalf of budget cuts next time around (which will probably be the end of this year). So House Speaker John Boehner is reportedly meeting with Ryan and other conservatives like Louisiana Rep. Steve Scalise, who boasted about their talks to the National Journal. The key points:
For a long-term deal, one that gives Treasury borrowing authority for three-and-a-half years, Obama would have to agree to premium support. The plan to privatize Medicare, perhaps the most controversial aspect of the Ryan budget, is the holy grail for conservatives who say major deficit-reduction can only be achieved by making this type of cut to mandatory spending. “If the president wants to go big, there’s a big idea,” said Rep. Steve Scalise, chairman of the Republican Study Committee.
For a medium-sized increase in the debt-limit, Republicans want Obama to agree to cut spending in the SNAP food stamp program, block-grant Medicaid, or tinker with chained CPI.
For a smaller increase, there is talk of means-testing Social Security, for example, or ending certain agricultural subsidies.
…Even at the smallest end of the spectrum — another months-long extension of debt-limit — there is talk of pushing back the eligibility age for Social Security by an equal number of months.
Are these people on drugs? These are wildly unpopular ideas that have no chance of passing the Senate. (“Republicans are eager to look like they are giving the White House plenty of options, convinced that it is in their interest to appear engaged and flexible at the negotiating table,” the NJ’s Tim Alberta reports, apparently unironically.) Unfortunately, the president himself has come out behind the chained CPI, but given the enormousness of House GOP demands and delusion, he’s unlikely to get much for that concession. So one cheer for House GOP delusion.
Scalise seems to be the main source for the National Journal story, and you can imagine other members wincing at his clueless bluster. Not surprisingly, Scalise starred in another story today about the Obama team’s belief it will see some congressional movement on both immigration reform and the economy this summer. Not so fast, Scalise told the Washington Post: “We’re going to continue to be very aggressive in serving as a check and balance against the Obama administration. That’s what the country said in November. We’re very far apart.”
It’s interesting to note that Paul Ryan is key to these debt-ceiling strategy talks, according to the National Journal, when he’s also supposed to be key to comprehensive immigration reform. To his credit, Ryan has come out for something along the lines of the Senate bill, but the question is whether he’ll expend any political capital getting other members to join him. So far, he hasn’t. It looks like another round of debt-ceiling hostage taking is a higher priority for him.
Ironically, the fact that the deficit is falling faster than at any time since World War II is helping drive the House GOP’s extremism – they have to go for big, slashing cuts, because the deficit is already shrinking. Here’s hoping the extremism of the House GOP’s opening salvo will remind the Obama administration not to waste its time on another attempt at a “grand bargain” on deficit reduction.
By: Joan Walsh, Editor at Large, Salon, July 8, 2013
“A Congress Divided”: Overcoming The Rigid And Obstructionist Partisanship Of House Republicans
The Senate provided the country a rare and modest glimpse of bipartisanship in its 68-32 passage of the comprehensive immigration reform bill laboriously accomplished by the Gang of Eight — four Democrats and four Republicans. But overcoming the rigid and obstructionist partisanship of the House Republicans will be another matter.
House Speaker John Boehner, like a chief lemming leading his followers over a cliff, warned in advance of that Senate vote, in which 14 Republicans broke party ranks, that his flock would continue its obdurate ways on the politically explosive immigration issue.
“For any legislation, including a conference report, to pass the House,” Boehner proclaimed, “it’s going to have to be a bill that has the support of the majority of our members.” He obviously was referring to the GOP side alone, as if the House Democrats weren’t members of what senators call “the other body.”
It’s a party position that former House Speaker Dennis Hastert often insisted upon in his abbreviated tenure. It was designed to assure that the House Republicans would work their will on the full House in an our-way-or-the-highway invitation to stalemate.
Boehner in adhering to this posture endangers not only the prospect for meaningful immigration reform. He also jeopardizes his party’s political outlook in 2014 and 2016 and his own speakership. He continues to genuflect before the most conservative House Republicans, driven by Tea-Party recalcitrance, who nevertheless increasingly favor his disposal.
The 14 Senate Republicans apparently hope their support of the bipartisan compromise will ameliorate their party’s problem with Hispanic voters, so graphically demonstrated by their 70 percent vote against GOP standard-bearer Mitt Romney in 2012. But the Senate version, heavy on fattened border security but allowing a path to American citizenship for undocumented aliens, will mean little politically if their House brethren refuse to buy into key elements of it.
President Obama did not hesitate to goad the House Republicans to follow the lead of the small band of Senate Republicans who followed GOP Sens. John McCain and Jeff Flake of Arizona, Lindsey Graham of South Carolina, and Marco Rubio of Florida in getting off the naysay trail for once.
In all the Republican post-mortems after the Romney defeat, a deafening chorus was heard arguing that the party should address the wide loss of Hispanic, Asian and African-American voters in the 2012 election. Boehner, an astute and practical politician, surely got the message, but appears throttled by the Tea-Party constituency that now dominates his flock.
Until the 14 Senate Republicans cast their votes for the Gang of Eight’s immigration reform package, conservatives in both houses had at least the comfort of knowing they were all in the same boat. The challenge for Boehner, after one-third of the Senate Republican membership voted with the Democrats, is to prevent further leakage in his foundering House craft.
Obama and fellow Democrats, frustrated throughout the president’s first term by Republican congressional roadblocks, are looking to next year’s midterm elections to break the jam, expecting enhanced support from minority voters. The same elections could likewise determine Boehner’s political future if he continues to allow the most extreme elements of his constituency of the right to set a stubborn and resistant course to genuine immigration reform.
At a minimum, Boehner needs to get off his insistence that the House must and will go its own way on the issue, writing a package that can capture “a majority of the majority” membership. Such an outcome will only end in negating a rare example of Senate bipartisanship achieved in a Congress that once marked its most productive and laudatory days under both Democratic and Republican presidents.,
Last November, the Republican brand suffered a body blow with a presidential campaign that only reinforced its image as the party of the white and the well-off. The continuing fight over immigration reform can be a GOP opportunity to combat that view, but not unless Boehner and Co. seize it as their 14 Senate brethren have done.
By: Jules Witcover, The National Memo, July 2, 2013
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