How did the IRS mess happen?

By: Les Dunaway

On Thursday and Friday mornings, as is often the case, the Wall Street Journal published two articles which focus on the “How?” and the “Why?” of things. In the process, these two articles give some clear insight into the “Who?” of this disgrace to our nation.

On Thursday morning, Steven Law, CEO GPS Crossroads, in What Enron and the IRS Have in Common, explained how rot and corruption can spread downward through an organization. By the way, it spreads in the same way through a city, county, state or a nation.  The lead paragraph ends with “Such messes are the result of a toxic culture which has been allowed to fester”.  To me that sounds like a description of our nation’s capitol. Mr Law earned his right to an opinion wading through the swamp that was Enron.

From that experience he gives this perspective “While lower-level Enron employees did their jobs honorably, senior management cultivated a malignant esprit de corps that corroded the company’s ethics”.  So, what does Enron have to do with the IRS?

Speaking of the low/mid level IRS employees “These IRS employees believed that they had implicit consent to ideologically profile nonprofit advocacy groups”. A conclusion “What the Enron scandal teaches is that such implicit permission can be communicated by a toxic culture fostered by the company’s top brass”.

Looking again at the IRS debacle “Consider the tone that has been set by the person at the very top of the government the IRS serves. President Obama is the first president since Nixon to refer to political opponents as “enemies,” in October 2010, apologizing only after a week of intense criticism. Around the same time, he assailed conservative advocacy groups as a “threat to democracy.” As the nation’s top law enforcer, Mr. Obama singled out groups such as Americans for Prosperity by name and suggested they could be taking illegal foreign funds. That’s toxic culture from the C-Suite.”

“Next, at least 10 Democratic senators publicly pressured the IRS to do precisely what it is now being excoriated for: harassing center-right groups for conducting the same spirited advocacy that environmental groups and labor unions have done for years. I know something about this: A month before the 2010 election, Sen. Dick Durbin sent a letter urging the IRS to investigate the advocacy group I head, Crossroads GPS. Why us and not scores of liberal groups that do exactly what we do? Mr. Durbin claims he singled us out because we were raising so much money.”

Mr Law concludes with “Congress’s role in corrupting the IRS must be investigated, and tough new penalties should be imposed on members of Congress who try to call in IRS drone strikes on perceived political enemies. Hatch Act restrictions on the ability of IRS employees to engage in politics—recently watered down by Congress—should be re-examined in light of the IRS’s politically aggressive union.
As an old political hand once told me, “There’s never just one cockroach.” The IRS scandal wasn’t the work of a few isolated employees. It was fostered by a culture that many powerful people in Washington helped create—and it will take time and hard-nosed action to eradicate it.”

I believe that he’s nailed the why. It’s important to understand one thing – the “toxic culture” did not grow just since Obama came into office. It has been festering since 1913.  There is no way that any sane person could even imagine that an organization, such as the IRS, with the ever-increasing power our feckless Congress has heaped upon it could remain honest and un-corrupted.

On Friday morning, Kimberley Strassel, Wall Street Journal,  in An IRS Political Timeline lays out the process by which the orders were given to the willing accomplices in the IRS.

Rather than paraphrase, I’ll quote her opening paragraphs:

“Perhaps the only useful part of the inspector general’s audit of the IRS was its timeline. We know that it was August 2010 when the IRS issued its first “Be On the Lookout” list, flagging applications containing key conservative words and issues. The criteria would expand in the months to come.

What else was happening in the summer and fall of 2010? The Obama administration and its allies continue to suggest the IRS was working in some political vacuum. What they’d rather everyone forget is that the IRS’s first BOLO list coincided with their own attack against “shadowy” or “front” conservative groups that they claimed were rigging the electoral system”

Here’s the timeline,  with my bullets:

  • Aug. 9, 2010: In Texas, President Obama for the first time publicly names a group he is obsessed with—Americans for Prosperity…
  • Aug. 11: The Democratic Congressional Campaign Committee sends out a fundraising email warning about “Karl Rove-inspired shadow groups.”
  • Aug. 21: Mr. Obama devotes his weekly radio address to the threat of “attack ads run by shadowy groups with harmless-sounding names. …
  • Week of Aug. 23: The New Yorker’s Jane Mayer authors a hit piece on the Koch brothers, entitled “Covert Operations,” in which she accuses them of funding “political front groups.”…
  • Aug. 27: White House economist Austan Goolsbee, in a background briefing with reporters, accuses Koch industries of being a pass-through entity that does “not pay corporate income tax.”…
  • Sept. 2: The Democratic Congressional Campaign Committee warns on its website that the Kochs have “funneled their money into right-wing shadow groups.”
  • Sept. 16: Mr. Obama, in Connecticut, repeats that a “foreign-controlled entity” might be funding “millions of dollars of attack ads.”…
  • Sept. 21: Sam Stein, in his Huffington Post article “Obama, Dems Try to Make Shadowy Conservative Groups a Problem for Conservatives,” writes that a “senior administration official” had “urged a small gathering of reporters to start writing on what he deemed ‘the most insidious power grab that we have seen in a very long time.’ “
  • Sept. 22: In New York City, Mr. Obama warns that conservative groups “pose as non-for-profit, social welfare and trade groups,”…
  • Sept. 26: On ABC’s “This Week,” Obama senior adviser David Axelrod declares outright that the “benign-sounding Americans for Prosperity, the American Crossroads Fund” are “front groups for foreign-controlled companies.”
  • Sept. 28: The president, in Wisconsin, again warns about conservative organizations “posing as nonprofit groups.”
  • Sept. 28: Sen. Max Baucus, chairman of the Senate Finance Committee, writes to the IRS demanding it investigate nonprofits. The letter names conservative organizations.
  • On Oct. 14, Mr. Obama calls these groups “a problem for democracy.”…
Ms Strassel concludes with:
“This newspaper reported Thursday that Cincinnati IRS employees are now telling investigators that they took their orders from Washington. For anyone with a memory of 2010 politics, that was obvious from the start.”
I believe, from the above, it is clear that the IRS scandal is not one serious problem, but two.
First we have a major, possibly the most “major”, government agency that is clearly rotten through and through.  Sen Ted Cruz tweeted “Mr. President, if your #1 priority is fixing the problem, let’s abolish the  and ensure it NEVER happens again!”

 

Unfortunately, Sen Cruz also advocated a flat tax to replace the current tax code. That does not solve the problem! A flat tax still requires that each American disclose their financial dealings to the government. Nothing would change. I can just see the twenty pages of proof attached to the famous flat tax postcard.

 

Only a consumption tax, collected by the states through existing mechanisms will keep the government out of our business.

 

The second problem is, quite possibly, the most thoroughly corrupt administration ever to disgrace America. Fixing that is, at least, a well defined process. It starts now, with a major event on 4 Nov 2014 and a second major event on 8 Nov 2016. There’s a lot to be done, before and between those events

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