We now know beyond a doubt that the Internal Revenue Service targeted and denied the nonprofit status of hundreds of organizations — mostly Tea Party and constitutionalist groups, but also those across the spectrum like Coffee Party USA — just in time for the 2012 presidential election. What we don’t know is whether anyone will be punished for this grand-scale corruption.
Don’t hold your breath, since there likely will be no punishment for the dozens, if not hundreds, of collaborators. The lone resignation of Lois Lerner, who led the Exempt Organizations Division, is hardly a slap on the wrist and the best the victims are likely to get.
The overt lack of accountability makes clear that no new coat of paint will suffice for preventing a recurrence. This is particularly the case because the targeting and subsequent coverup proceeded despite the presence of the quorum-less IRS Oversight Board, the Treasury Inspector General for Tax Administration, and another half dozen oversight organizations. The truth of the deleterious activity is plain for all to see, even for the general public, so another government board to observe and inspect will prove as feckless as those already in place.
The 695-page release (PDF) of documents on April 4 — acquired thanks to a Freedom of Information Act request from Judicial Watch — is the final nail in the coffin, if there were any doubters still around. The fact that these documents remained under wraps during congressional hearings is itself worthy of condemnation.
Judicial Watch President Tom Fitton says there is no wonder why the IRS was reluctant to release these files: “The new smoking-gun documents contain admissions by the Obama IRS that it inappropriately targeted conservative groups.” Further, even when coming under scrutiny, “the abuse continued — as the Obama IRS tried to force conservative applicants to give up their First Amendment rights in order to finally get their applications granted.”
He is referring to internal correspondence from IRS officials with their admissions that they used “inappropriate political labels” to screen applications, the notorious be-on-the-lookout (BOLO) list. The words, which do include some terms that align with progressives, would halt applications for tax-exempt status for nonprofits, a pivotal ingredient to a new charitable organization’s growth. While some advocacy organizations may continue on an all-volunteer basis without donations, denial of nonprofit status can be a lever to silence dissent, since donations flow to other organizations that enable tax deductions.
Such is the breadth of the IRS-scandal revelations, which have rolled in and deepened over the past four years, that even the removal of the IRS Commissioner John Koskinen would have little to no impact. He may have impeded the investigation, but he was not at the helm when the critical actions began and proceeded — although that has not stopped many Republicans and conservative outlets from pushing for his dismissal.
The key point lost amid what has unfortunately become a partisan hot potato is that the IRS problem is not one of personnel or party; it is systemic in favor of whoever holds power in Washington, DC. Such a large, centralized bureaucracy has countless opportunities to defer and dilute culpability, and US citizens have no way to opt out of IRS jurisdiction as they have between the states.
Not only will going after a few visible individuals not root out the bad faith, “American taxpayers are at risk for similar treatment in the future” — as noted by the Cause of Action Institute, another DC-based watchdog. CAI asserts that the targeting of politically relevant nonprofits with Special Case Reports (PDF) was and remains standard procedure. Their case rests on the little-known nonprofit red flags from Part Seven of the Internal Revenue Manual for IRS employees, which include whether the group might “generate significant publicity or controversy.”
IRS officials can, have, and will commit similar wrongs against the likes of Occupy Wall Street advocacy organizations, and they have shown a remarkable unwillingness to back down on the BOLO list and their internal procedures. This all means we have to change incentives for the IRS and find solutions that go beyond the normal partisan brinkmanship.
One such individual aware of the deeper problem with corruption at the federal level is Jed Wheeler, vice chair of the California National Party. He describes himself and his party, which seeks independence for the state, as progressive and in favor of taxation on those who can better afford to pay. However, he clarifies that, while they are left leaning, they “do not have much love for the Democratic Party.”
This IRS scandal does not surprise Wheeler, since he sees it as consistent with the tactics of the establishment within both major parties. They “protect their own privilege at the expense of challengers,” he explains. “The Tea Party is interesting, whether you agree with them or not, because they very effectively challenged the power of the Republican establishment.… As an insurgent political movement … both political parties have tried to fight [it] unsuccessfully.”
Even if he “has no ideological love for the Tea Party,” Wheeler believes in equal treatment for all within the tax system, regardless of political inclination. Further, his outlook suggests room for common ground on the devolution of authority to the state and local levels. He bristles at the fact that California pays out more in taxes than it receives back from the federal government, and he takes particular exception with the military budget, which he says is unpopular with Californians.
What is politically plausible remains to be seen, be that a reworking of IRS procedures by the Congress or a more fundamental tax reform that places revenue collection in the hands of state governments. Perhaps the former can be an intermediate step before the latter.
Regardless, no one can plead ignorance anymore. The IRS may have fooled constituents and Congress once. Shame on them. But if they fool the people twice, shame on us for not stepping in and disarming them.