Trumped Up Scandal

Well, I must say I feel like a fool. I actually thought that the IRS targeting Tea Party and conservative organizations was an example of the improper use of a government agency to intimidate and harass people with dissenting viewpoints. Lucky for me, I read Noam Scheiber‘s piece in the New Republic. Mr. Scheiber has explained everything and straightened me out.

Democrats can’t say it; Barack Obama can’t say it; and the IRS certainly can’t say it, so here goes: The only real sin the IRS committed in its ostensible targeting of conservatives is the sin of political incorrectness—that is, of not pretending it needed to vet all the new groups that wanted tax-exempt status, even though it mostly just needed to vet right-wing groups.

How do we know this? Because, for one thing, the people submitting the questionable applications were overwhelmingly right-wingers. As others have pointed out, the early Obama era was a boom time for conservative activists, who were forming groups faster than NBC burns through “Today Show” hosts. This coincided with a series of court rulings that made it possible for these groups to claim tax-exempt status without disclosing their donors under section 501c4 of the tax code.1 As a result, there were suddenly way more non-disclosing political groups trying to claim tax-exempt status than there ever had been, and the vast majority were right-leaning. No surprise, then, that the IRS would focus on whether these groups actually qualified for that status—something that was questionable since the law said their primary activity needed to be “social welfare,” not politicking.

But, in fact, the IRS’s great conservative crackdown is even more innocent than that. It turns out that the applications the conservative groups submitted to the IRS—the ones the agency subsequently combed over, provoking nonstop howling—were unnecessary. The IRS doesn’t require so-called 501c4 organizations to apply for tax-exempt status. If anyone wants to start a social welfare group, they can just do it, then submit the corresponding tax return (form 990) at the end of the year. To be sure, the IRS certainly allows groups to apply for tax-exempt status if they want to make their status official. But the application is completely voluntary, making it a strange basis for an alleged witch hunt.

So why would so many Tea Party groups subject themselves to a lengthy and needless application process? Mostly it had to do with anxiety—the fear that they could run afoul of the law once they started raising and spending money. “Our business experience was that we had to pay taxes once there was money coming through here,” says Tom Zawistowski, the recent president of the Ohio Liberty Coalition, which tangled with the IRS over its tax status. “We felt we were under a microscope. … We were on pins and needles at all times.” In other words, the groups submitted their applications because they perceived themselves to be persecuted, not because they actually were.

So you see. There were just so many shady Tea Party groups forming that of course the IRS had to be very careful vetting all the applications. Oh but wait. According to USA Today, liberal groups had very little trouble getting tax exempt status.

In the 27 months that the Internal Revenue Service put a hold on all Tea Party applications for non-profit status, it approved applications from similar liberal groups, a USA TODAY review of IRS data shows.

As applications from conservative groups sat in limbo, groups with obviously liberal names were approved in as little as nine months. With names including words like “Progress” or “Progressive,” these groups applied for the same tax status and were engaged in the same kinds of activities as the conservative groups.

The controversial, 3-year-old strategy to manage the increasing number of political groups seeking tax-exempt status came under fire Tuesday. The agency’s own inspector general blamed IRS leadership for “ineffective management.”

The Justice Department wants to know if that was more than just mismanagement. Calling the IRS’ actions “outrageous and unacceptable,” Attorney General Eric Holder said Tuesday that he has asked the FBI to investigate. “We’re examining the facts to see if there were any criminal violations,” he said.

A federal official who has been briefed on the matter said the investigation could focus on potential violations of civil rights law, including targeting groups based on political affiliation and infringing free speech. The official, who is not authorized to comment publicly, said authorities could consider possible violations of the Hatch Act, which restricts political activities of government workers.

There goes that narrative.

Mr. Scheiber wonders why the Tea Party organizations might be anxious to make sure all their paperwork was in order. For many organizers of the Tea Party, this was their first actual experience with political activism. Despite the liberal talking point that the Tea Party is Astroturf, most Tea Partiers are not the sort of professional protesters found in Soros funded Left wing political pressure groups. Quite a few of these people owned their own businesses and most were used to the idea of obeying the laws and regulations they were subject to. Also, Tea Party activists knew full well that liberal politicians from the President on down and the mainstream media hated them. The Tea Party has been called racist, bigoted, fascist, Nazis, and worse by tolerant, compassionate liberals.No slander was too outrageous to fabricate about the Tea Party. They had good reason to want to make sure everything was in order.

Fine—there’s no law against neurosis. But, to borrow a thought experiment from my colleague Alec MacGillis, consider all this from the perspective of the IRS’s Cincinnati office, which handles tax-exempt groups. You’re minding your own business in 2009 when you start to receive dozens of applications from right-leaning groups, applications you didn’t solicit and don’t require. You peruse a few of the applications and it looks like many of the groups, while claiming to be “social welfare” organizations, have an overtly political purpose, like backing candidates with specific ideological agendas. Suffice it to say, you don’t need an inquisitorial mind to decide the applications deserve careful vetting. One Tea Party activist from Waco, Texas, has complained that an IRS official told her he was “sitting on a stack of tea party applications and they were awaiting word from higher-ups as to how to process them.” The quote is intended to sound nefarious—an outtake from some vast left-wing conspiracy—but it’s actually perfectly straight-forward: The IRS was unexpectedly flooded by dodgy 501c4 applications and was at a loss over how to manage them.

Why did they have to wait for word from higher up? Did they not have a standardized procedure for processing 501c (4) applications? Why are conservative applicants somehow more dodgy than liberal ones. According to USA Today, the vetting only applied to groups with names like “Tea Party”.

Let’s try a thought experiment of our own. Suppose a Republican administration were caught giving extra attention to liberal groups that were active in protesting against the President’s policies. Would Noam Scheiber have such a blase attitude about the matter? I think it is more likely that every liberal columnist and pundit in the country would be screaming bloody murder.

So the crime here had nothing to do with “targeting” conservatives. The targeting was effectively done by the conservative groups themselves, when they filed their gratuitous applications. The crime, such as it is, was twofold. First, in the course of legitimately vetting questionable applications, the IRS appears to have been more intrusive than justified, asking for information about donors whose privacy it should have respected. This is unfortunate and intolerable, but not quite a threat to democracy.

Second, the IRS was tone deaf to how its scrutiny would look to the people being scrutinized, given that they all subscribed to the same worldview, and that they were already nursing a healthy persecution complex. Which is to say, the IRS didn’t go about its otherwise legitimate vetting in a very politically-correct way. “It’s part of their job to look for organizations that may be more likely to have too much campaign intervention,” a law professor named Ellen Aprill told The Washington Post. “But it is important to try to make these criteria as politically neutral as possible.”

Again, according to USA Today, the crime had everything to do with targeting conservatives. The people who work for the IRS must have a good idea of the anxiety even a routine inquiry produces in most Americans. Getting official letters demanding to know details about donors, books read, personal lives of board members and their families must be a terrifying experience, even for people who do not have an anti-government world view. The people behind all this were counting on that.

The article goes on about profiling and implies that conservatives are hypocrites for supporting profiling Muslims as potential terrorists while opposing the idea of conservative groups being profiled as engaging in fraud for requesting tax exempt status. There are some interesting reader comments, though. I will omit the names of the people who made the comments.

Considering how right-wing conservatives beginning with Newt Gingrich have targeted the IRS for crippling budget cuts and rigamarole that prevent it from effectively auditing tax returns (“… the average person [has] a one-in-200 chance of an audit, which is down from one-in-112 in 1999, and one-in-60 in 1996, according to new data from the IRS”) I would say this sounds like a case of turnabout-is-fair-play.

I am down on democracy these days because the right wing has abandoned its responsibility to govern. Very well then: if they will not govern, they will damn well be ruled.

Don’t you think an organization named after a famous tax refusal protest MIGHT deserve a little extra scrutiny, especially if they are claiming to be a “social welfare” organization? As far as I know, the members of the Boston Tea Party didn’t claim they were the Boston United Way.

So, these people believe that a proper function of government is to punish people who are against high taxes. Interesting. Also, why do we right wingers have to choose between being rulers or being ruled. Personally, I don’t want to rule anyone. I want to be left alone.

 

 

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2 Responses to “Trumped Up Scandal”

  1. hansston Says:

    I had read this also, great response!

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