What is the IRS ‘scandal’ about?

An Almost-Final Word On The IRS’s Alleged Tea Party Targeting

This all goes back to the scrutiny the IRS gave to politically active “social welfare” organizations between 2010 and 2013. Conservatives allege that mainly Tea Party groups were targeted. The controversy led to a housecleaning at the top of the IRS — also, to a collapse in the agency’s already feeble attempts to enforce its existing rules on political activity by 501(c)(4) social welfare groups.

The numbers and budgets of politically active social welfare groups have soared since the Supreme Court’s Citizens United ruling in 2010, especially among conservatives. SuperPACs, which are also used by both sides, must disclose their donors, while 501(c)(4) groups have no disclosure requirement.

Facebook, the IRS, and the GOP’s Bullshit Feedback Loop

In reality, the IRS “scandal” was the unhappy byproduct of an agency being tasked with determining the validity of claims to non-profit status, but lacking the proper resources to do it or clear guidance on how. The fact that new Tea Party groups, many with dubious claim to non-profit status, had flooded the IRS with applications compounded the difficulty. The agency thus used watchwords like “tea party” and “progressive” to, in its words, triage the workload.

For the purposes of ginning up voters, that story is much less useful than one in which a liberal agency leader masterminded a sabotage campaign against patriotic conservatives trying to rescue the country from Obama. And so the IRS scandal was born.

Report On IRS Targeting Of Conservatives – No Christmas Pony For Darrell Issa

Now if both sides were doing it equally, it would be possible for the IRS to approach the matter in an even handed manner. As it turns out, unlike the remarkably similar activities of the Kriegsmarine U-boats in the Atlantic and the US Navy submarines in the Pacific, “dark money” is more of a conservative thing . According to Open Secrets in the 2010 election cycle conservative non-disclosure spending was $119.9 million and liberal non-disclosure spending was $10.7 million. In the 2012 election cycle it was $265.5 million conservative versus $33,6 million liberal. The gap starts closing in 2014 but remains wide with $192.8 million conservative and $54 million liberal.

That makes it impossible for IRS action or non-action to not have political effect. Now if we had really wise leaders, they would have gotten together and said that the country needs good tax administration and the Republicans would have agreed to ease up on pushing the envelope so much and the Democrats would not have pressed the IRS to worry so much about a matter that was not contributing to the tax gap. Probably too much to ask for. Instead we’ve got “Winning isn’t everything. It’s the only thing.”

New Records: IRS Targeted Progressive Groups More Extensively Than Tea Party

A series of IRS documents, provided to ThinkProgress under the Freedom of Information Act, appears to contradict the claims by Rep. Darrell Issa (R-CA) and his House Oversight and Government Reform Committee that only Tea Party organizations applying for tax-exempt status “received systematic scrutiny because of their political beliefs.” The 22 “Be On the Look Out” keywords lists, distributed to staff reviewing applications between August 12, 2010 and April 19, 2013, included more explicit references to progressive groups, ACORN successors, and medical marijuana organizations than to Tea Party entities.

Donna Brazile: No conspiracy here, IRS targeted liberals, too

In fact, a few months after the story of the report broke, new documents came to light showing more of the extent of scrutiny of progressive groups. At the time, Alex Seitz-Wald described the landscape this way.

But now, almost two months later, we know that in fact the IRS targeted lots of different kinds of groups, not just conservative ones; that the only organizations whose tax-exempt statuses were actually denied were progressive ones; that many of the targeted conservative groups legitimately crossed the line; that the IG’s report was limited to only Tea Party groups at congressional Republicans’ request; and that the White House was in no way involved in the targeting and didn’t even know about it until shortly before the public did.

Needless to say, especially disturbing is the idea that Issa conveyed to the IG his wish that the investigation focus on conservative groups to the exclusion of progressive ones. The IG later said that initial report was inaccurate, but he didn’t say what was inaccurate about it or offer any explanation of why his spokesperson would have said Issa told them to produce a one-sided report.

New Documents Show the IRS Targeted ‘Progressive’ and ‘Tea Party’ Groups for Extra Scrutiny

Arguably, ThinkProgress’s report implies, the IRS focused on giving extra scrutiny to groups on the left longer than it did to groups on the right, Issa’s colleagues across the aisle on the Oversight Committee have long noted that Issa has yet to produce evidence supporting his repeated claims that the IRS was acting as part of an anti-GOP political conspiracy. These documents, which ThinkProgress notes were also produced for “investigating congressional committees,” are certainly not that evidence. Here’s a list of some of the groups that show up on the full BOLO watch lists (viewable here):

  • “Progressive” groups, especially those with words like “blue” in the name
  • “Tea Party” groups
  • Not exclusively educational “medical marijuana” groups
  • Groups believed to be “successors to ACORN”
  • “Open source software” organizations
  • “Green energy” organizations
  • “Occupied territory” advocacy organizations

On the “emerging” section on one of the distributed lists, the BOLO lists contains this downright bipartisan warning:

Political action type organizations involved in limiting/expanding government, educating on the constitution and bill of rights, Social economic reform/movement

Anyway, Issa already has a response to that non-specific language. The political watch list language was “changed to broader ‘political advocacy organizations,’” he wrote in a committee report, adding that he believes “the IRS still intended to identify and single out Tea Party applications for scrutiny.” Even though it looks like progressive groups may have ended up on the watch list before the Tea Party started popping up.

Senate Report Confirms That Republicans Lied About The IRS Only Targeting Conservatives

A newly released report from the Senate Permanent Subcommittee On Investigations confirms that both liberal and conservatives groups received the same bad treatment and were targeted by the IRS. In short, Republicans lied about the IRS only targeting conservatives.

The Executive Summary section of the report put the Republican IRS conspiracy down for the count,

The Subcommittee investigation has reached many of the same conclusions as the TIGTA audit of the 501(c)(4) application process. The Subcommittee investigation found that the IRS used inappropriate screening criteria when it flagged for increased scrutiny applications based upon the applicants’ names or political views rather than direct evidence of their involvement with campaign activities. The Subcommittee investigation also found significant program mismanagement, including years-long delays in processing 501(c)(4) applications; inappropriate, intrusive, and burdensome questioning of groups; and poor communication and coordination between IRS officials in Washington and Cincinnati. At the same time, like TIGTA, the Subcommittee investigation found no evidence of IRS political bias in selecting 501(c)(4) applications for heightened review, as distinguished from using poor judgment in crafting the selection criteria. Based on investigative work that went beyond what TIGTA examined, the Subcommittee investigation also determined that the same problems affected IRS review of 501(c)(4) applications filed by liberal groups.

In addition, the Subcommittee investigation found that, by focusing exclusively on how the IRS handled 501(c)(4) applications filed by conservative groups and excluding any comparative data on applications filed by liberal groups, the TIGTA audit produced distorted audit results that continue to be misinterpreted. The TIGTA audit engagement letter stated that the audit’s “overall objective” was to examine the “consistency” of IRS actions in identifying and reviewing 501(c)(4) applications, including whether “conservative groups” experienced “inconsistent treatment.” Instead, the audit focused solely on IRS treatment of conservative groups, and omitted any mention of other groups. For example, while the TIGTA report criticized the IRS for using “Tea Party,” “9/12,” and “Patriot” to identify applications filed by conservative groups, it left out that the IRS also used “Progressive,” “ACORN,” “Emerge,” and “Occupy” to identify applications filed by liberal groups. While the TIGTA report criticized the IRS for subjecting conservative groups to delays, burdensome questions, and mismanagement, it failed to disclose that the IRS subjected liberal groups to the same treatment. The result was that when the TIGTA audit report presented data showing conservative groups were treated inappropriately, it was interpreted to mean conservative groups were handled differently and less favorably than liberal groups, when in fact, both groups experienced the same mistreatment. By excluding any analysis of how liberal groups were handled and failing to provide critical context for its findings, the TIGTA audit inaccurately and unfairly damaged public confidence in the impartiality of the IRS.

So IRS Didn’t ‘Target Conservative Groups,’ After All

It turns out that the IRS really was just doing its job — scrutinizing all kinds of groups applying for special tax status, not “targeting conservatives” as has been widely reported. Of course anti-government scandal-mongers are trying to make this sound bad, saying this means the “targeting” was “broader” than first thought. That’s like saying people are “targeted” to pay their taxes on April 15. Anyway the “scandal’s” purpose was achieved: the IRS is going to give corporate-funded political groups a pass now and let them “self-certify” that they aren’t breaking the rules. […]

But the truth doesn’t matter. The fact that there was no “targeting of conservative groups” doesn’t mean that conservatives don’t get their way. Even though the whole “ACORN scandal” turned out to just be a lie, Congress defunded ACORN anyway. Van Jones and Shirley Sherrod were both fired after right-wing media launched smear and lie campaigns. And this time the administration immediately caved to the right and fired the head of the IRS. This of course amplified the right’s “targeted conservatives” accusations and whipped the media into a full-blown scandal frenzy.

And the clincher: the IRS has issued new rules, offering corporate-funded political groups a “fast track” to getting their special tax status.

The Chronicle of Philanthropy explains, in IRS Offers Fast-Track for Advocacy Groups Awaiting Tax Exemptions. All they have to do is self-certify that they won’t break the rules, and Bob’s your uncle.

Organizations that have applied to the IRS for status as social-welfare groups but have faced inordinate delays because of the political scrutiny that engulfed the tax agency in controversy now have recourse: They can win tax-exempt status within two weeks if they pledge not to devote more than 40 percent of their time and money to partisan activities.

The IRS announced the streamlined process on Monday as part of its 83-page report, shown below, on how the agency is overhauling its process for reviewing applications for tax-exempt status. By setting the 40-percent marker, the organization for the first time was explicit about how much advocacy is acceptable for a group that has 501(c)(4) status.

So they win.

House Republicans pretend IRS ‘scandal’ still exists

Just so we’re clear, these House Republicans still haven’t uncovered any evidence of official wrongdoing, and they didn’t accuse Koskinen of having any role in “targeting” anyone. Rather, the GOP lawmakers are convinced Koskinen hasn’t done enough to help them find evidence to substantiate allegations that fell apart two years ago.

Or put another way, they want to fire the IRS guy who replaced the other IRS guy who was fired over a “scandal” that never really existed in the first place.

There is, of course, no reason to believe Koskinen’s job is in jeopardy, which is probably why House Oversight Committee Chairman Jason Chaffetz (R-Utah) raised the prospect of holding the IRS commissioner in contempt of Congress, because, well, why not? It’s been months since House Republicans held an Obama administration official in contempt of Congress, they’re arguably overdue.

Fox News’ phony scandal: The truth about the fictional “plot” to suppress conservatives

Absent campaign-finance law, and with a deadlocked Federal Election Commission incapable of acting, the IRS was the last defense against opaque and unrestricted political money. Yet as Republicans in Congress blocked efforts to address campaign-finance transparency, nonprofits were inundating the IRS with applications for tax-exempt status, many for social-welfare groups. And media outlets were focused on “Tea Party” groups forming around the country.

Against this backdrop, one IRS case manager in the Los Angeles office forwarded an application to the agency’s Cincinnati office for review, expressing concern that the organization applying for nonprofit status was not being established for social-welfare purposes, but instead for political campaign activity. The Cincinnati office, which oversees nonprofit applications, agreed to review the case.

That questionable applicant was a Tea Party group, whose application triggered the reviewer’s concern over its involvement with direct campaign activity relating to specific candidates.

As applications stacked up, the IRS identified areas with potential for abuse, and began to flag applications that followed a similar format, issuing a “BOLO” (Be On the Lookout) alert for new applications with similar features or organizations with similar names.

Throughout 2010 and 2011, the IRS continued to wrestle with how it should handle these organizations in general (and Tea Party applications in particular), while the agency faced mounting pressure from House and Senate investigative committees concerning tax-exempt organizations and donor identities. Tea Party applications were particularly problematic, because the term “Tea Party” was identified with groups backing specific candidates or opposing the policies of the Obama administration.

Such activities are not covered by the “primary purpose” rule applicable to social-welfare groups, which restricts tax exemption (and freedom from disclosure requirements) to organizations that “operate primarily to further the common good and general welfare of the people of the community.”

In September 2010, Senator Max Baucus (D-MT) wrote to then-IRS Commissioner Douglas Shulman, asking him to conduct a survey of major 501(c)(4), (c)(5), and (c)(6) organizations involved in political campaign activity to see whether they were in compliance with the “primary purpose” rule. He also requested that the IRS look at whether the organizations “were acting as conduits for major donors advancing their own private interests regarding legislation or political campaigns.”

In 2012, Senator Carl Levin (D-MI) made a formal request for the IRS to produce specific information on the activity of several high-profile organizations, including Karl Rove’s Crossroads GPS, the liberal group Priorities USA, Americans for Prosperity, and Patriot Majority USA. As dark money spending increased in 2012, Levin pressed harder, criticizing the IRS decision to interpret the word “exclusively” to promote social welfare as “more than 50 percent” of the organization’s activity. He wanted to know how many tax exemptions had been audited to see if organizations engaged in excessive political activity.

After the 2012 elections, the IRS found itself caught between mounting pressure from Congressional Democrats and from groups receiving information requests from the IRS but no letters approving their tax-exempt status. The agency was requesting that applicants provide all donors’ names and addresses (presumably to satisfy the Baucus inquiry), sparking outrage among conservative groups asked for that information.


At the same time, Congressional Republicans began to hear from big donors who were concerned about the loss of anonymity—and the tax deductions that some of the nonprofits provided. And from “grass roots” groups impatient with the IRS.

One of these groups was KSP/True the Vote, a Texas-based voter-integrity organization originally known as the King Street Patriots—one of the nonprofit applicants selected by the IRS for closer scrutiny, based upon its application and media reports in 2010 in which KSP/True the Vote activists were accused of intimidating voters at the polls.

In 2010, acting under the name King Street Patriots, conservative Texas activist Catherine Engelbrecht accused a voter-registration group, Houston Votes, of being “the New Black Panthers office” in Texas. Claiming to have found thousands of fraudulent voter registrations in the Houston area, Engelbrecht appeared on Fox News, accusing Houston Votes of massive voter fraud. The King Street Patriots also produced a video that warned: “Our elections are being manipulated by the RADICAL LEFT.” Backed by an ominous soundtrack, the video also included a doctored image of an African American holding a sign that read: “I only got to vote once.”

Ironically, one documented case of voter fraud surfaced in Texas in 2010 when County Commissioner candidate Bruce Fleming, who had been endorsed by Engelbrecht, was found to have cast votes in Pennsylvania and Texas in the 2006, 2008, and 2010 elections, boasting that he “had the chance to vote twice against Barack Obama.”

Indeed, KSP/True the Vote’s literature established that they were operating for campaign purposes, as evidenced by a self-published “Legislative Agenda for Texas” in 2011 and their lobbying for stricter voter-ID laws. The state Democratic Party sued, and in 2011 a Texas court ruled that the King Street Patriots was a PAC and not a nonprofit group. The group was ordered to reveal its donors and pay Houston Votes a substantial settlement.

Despite the court ruling and extensive news coverage, when news broke on May 9, 2013, that the IRS may have singled out conservative groups for scrutiny, Engelbrecht was prepared. On May 21, KSP/True the Vote filed a federal lawsuit against the IRS for targeting them. The suit was dismissed in late 2014.

Attack on the IRS: Rightwing Terrorism?

Here is my appraisal of Joe Stack’s plane attack on the IRS building.  I’ve only begun to look at in more detail.  I’ve watched some news reports and read some of the details in the suicide note.  My tentative conclusions stated here might change based on further research or they might not.

Was the kamikaze pilot a rightwing terroritst?  Well, let’s break it down.

Was he a terrorist? That is a complex question.  There are many definitions that I’ve seen.  By some official definitions, he would be categorized as a terrorist.  By other official definitions, he wouldn’t be categorized as a terrorist.  So, I’m going to simplify it with more specific questions.

Did he copy the actions of those deemed terrorists?  Yes.  The method wasn’t original.  Obviously, his actions remind everyone of 9/11.  It probably was even intentional that he copied the method of terrorists.  This guy, like the 9/11 terrorists, both perceived the US government as corrupt.  In protesting this perceived corrupt governmenet, this guy, like the 9/11 terrorists, attacked a symbol of the economic power of the US government.  He used a similar violent method to make a similar statement of violent protest.

Did he cause terror?  Yes, most definitely yes.  The people in that building were terrorized.  IRS workers across the country now will go to work everyday in a state of fear.  This is similar to how, since the killing of Dr. Tiller, family planning doctors will go to work everyday in fear or else out of fear quit their jobs and not go to work at all.  Terrorism is effective in that it causes terror… that is why it’s called terrorism.

Did he intened to cause terror?  Probably.  HIs act of protest was intentionally violent and violence causes terror.  It’s probably safe to assume that he understood that his causing violence would cause terror.  I don’t know if he intended terror per se.  He may not have thought of himself as a terrorist, but he did intend retribution.  His purpose seemed to be to cause suffering on those he deemed to have caused his own suffering.  The intention of terror seems implied in both the note and the act.  It’s hard to know his precise intentions, but that is equally true of the 9/11 terrorists.  We aren’t reluctant to call Muslims terrorists even when they leave no note about their intentions.

To me, determining it was terrorism is simple.  It was an act that intentionally caused terror.  Terrorism is as terrorism does.  I, however, understand why others don’t consider it terrorism.  Joe Stack wasn’t a part of a terrorist group.  My response to that is terrorism isn’t limited to collective action.  Also, an argument can be made that this act of violence resonates with other recent acts of violence that were motivated by fear and hatred of government.  The same atmosphere of fear-mongering about the government (Beck being the most extreme example) contributes to people on the edge going whole hog over the edge (Beck about sends me over the edge on occasion).  Violent speech doesn’t directly cause violent action, but it makes it more likely.  The political polarization in general creates a mood of conflict that impacts the entire country (not just Beckheads and Tea Partiers).

More interesting to me is determining the ideology that motivated this particular act of violence.  My most specific interest is in wondering if there is a connection to the other acts of violence from this past year.  A lot of the violence recently has seemed correlated to a particular worldview of social and/or fiscal conservatism.  So…

Was he rightwinger?  At first, I thought yes.  I guess it depends on how rightwing is defined, but it can’t be denied he espoused at least some of what is typically labelled as rightwing ideology.  His criticisms of the IRS resonate with fiscal conservatism and would be right at home on a sign carried in a Tea Party protest.  That said, I haven’t heard of any evidence that he was a part of the Tea Party movement or any other specific movements.  He did belong to a group at one time that discussed tax law.  The important point is whether he became extreme in his viewpoint simply through his own experience or by being influenced by others.  Besides movements or groups, I’d like to know what news sources he read and if there were any place on the web where he regularly commented.

I’ve only skimmed his letter, but the conclusion at the end does create a bit of uncertainty about his actual criticism and the ideology that motivated it.

The communist creed: From each according to his ability, to each according
to his need.

The capitalist creed: From each according to his gullibility, to each
according to his greed.

Before I looked at the letter, someone mentioned his statement about communism but didn’t offer the specific quote.  I assumed it was the typical rightwinger preaching of anti-conmmunism.  I was clearly wrong.  I still don’t know what it means.

(Note: It’s unclear that Stack was a communist or was even basing his argument on communism. Comparative statements like the one Stack made have a varied history. One writer at Newsweek thinks it probably originated from Henry Fairlie who considered himself a conservative, but of course conservatives disagree with this connection because they don’t think Fairlie was a real conservative as he didn’t worship Reagan.)

Conservatives are fond of saying that liberals who turn to conservativsm have been “mugged by reality”.  However, Joe Stack seems to have been a man who tried to make it in the world of capitalism (the pillar of modern conservatism) and was mugged by reality.  Stack came to an interesting conclusion.  It wasn’t simply the IRS that was at fault.  Apparently, he was arguing that big government and big business were to blame (and he shared the blame with big religion as well).  That isn’t exactly rightwinger or leftwinger.  That is more in the territory of between libertarianism and anarchism.

I’m still a bit confused.  I heard Joe Stack was a small business owner.  Many small business owners are Republican or Libertarian (even when socially liberal).  Mr. Stack very well might’ve been a conservative at one time.  Maybe his protest was against the conservative ideal of free market capitalism which he thought had failed him… just a theory but it could explain a lot.  Despite the ideology, Republican politcians aren’t any more likely to help the small business owner than are Democratic politicians and so it’s understandable that a small business owner might become dissatisfied with mainstream conservatism.  He seemed to be embittered about the whole system and the IRS was just a symbolic target.  He wasn’t attacking anyone in particular.  He attacked a building… a building that symbolized the institution of the IRS, of the government, of the entire socio-political system.

Okay.  I was definitely wrong in thinking he was just a rightwing extremist, but he isn’t a leftwing extremist either.  So, what is he?  The problem is that our language is limited when it comes to labelling the ideologies of people.  I’ll have to read more of the letter to see if I can determine his views.  My suspicion is that he was a libertarian who started leaning socialist as the system failed to help him.  If so, does his letter portray him as more of a socialist libertarian or a libertarian socialist?  And was he actually a proponent of communism or simply using communist ideology as a convenient criticism of capitalist ideology?

His ‘communist’ statement, especially in context of his anti-government sentiments, isn’t that far off from what some anarchists preach.  Anarchism tends to be socialist if it focuses on the worker class and tends to be capitalist if it focuses on the owner class.  I assume he was being critical of our corporatocracy, but he may not have been against ‘capitalism’ as defined by some anarchist-leaning libertarians.  I don’t know if it ultimately matters.  I’m just curious if he was critical of our present capitalist system because he wished a true capitalist system would replace it or because he thought the entire basis of capitalism was faulty.  There is a big difference between the two.

Let me add one further question.

Does Joe Stack’s violent act discredit the message of protest and criticism?  No.  This is no different than the fact that the 9/11 terrorists didn’t discredit all Muslims around the world.  Every group has extremists, but it should be pointed out that certain groups are more prone to violent extremism than others.  Those who criticize the government for reasons of anti-taxation (and right to bear arms) tend to be more violent in their protests than environmentalists for whatever reason.  This often seems like a right/left divide (similar to pro-lifers being more violent than pro-choicers), but in this case no particular ideological movement can be blamed and discredited. 

I’m very critical of big government.  I think the taxation system is unfair.  And I’m certainly not a rightwinger.  This incident is sad because violence is rarely inspiring but more importantly it’s sad because the criticisms themselves get discredited in the mainstream media.  The Tea Party itself will become less credible simply for being ideologically similar to Joe Stack’s criticisms.  But criticisms of the government in general, from both the left and the right, get put in the light of extremism because of this act of terrorism.  Violence isn’t an effective method in getting people to take your message seriously.  Such acts of violence only justifies the government becoming more oppressive in maintaining order.

It’s actually more interesting that he didn’t turn out to be just a typical Tea Party protester.  And I’m glad it’s forcing the media to come to terms with the true political complexity of the American public.  All of this fits into my recent research into different movements and ideologies. 

Despite the GOP and Fox News trying to take control, the Tea Party isn’t a simple rightwing movement.  It includes a fairly wide range of people and interests (although still too narrow to be a truly populist movement).  And if you look at the origins of the Tea Party, you discover Ron Paul followers which touches upon the libertarian party.  Libertarians and independents have been behind all of the diverse protest movements/groups: Peace Protests, Truthers, Birthers.  Et Cetera.  There are white supremacists mixed in here, but there also those who geninely believe in freedom and civil rights for all.  There are militia secessionists involved in many of these protests, but most protesters don’t want violence and many in fact are pacifists.  The media can’t understand this kind of complexity.  Every movement has to be categorized as left or right.  Peace protesters were leftwingers because Republicans said so, and Tea Partiers are rightwing because Democrats say so.  There are ideological differences in these movements, but there also is much crossover.  Ron Paul libertarians were participated in the peace protests and now they’ve participate in the Tea Party protests. 

Joe Stack is even more difficult to categorize than the libertarians.  His complaints is a sampling of the entire range of criticism.  As an extremist, he comes off as a middle-of-the-road average American with gripes against the wealthy and powerful elite.

Here are some interesting articles, blogs, and videos about the topic (or of related topics):