STOCK MARKET WATCH -- Thursday, 27 June 2013

[Demeter]

21. The Vanishing I.R.S. Scandal by John Cassidy

http://www.newyorker.com/online/blogs/johncassidy/2013/06/darrell-issa-vanishing-irs-tax-scandal.html?mbid=nl_Daily%20%28273%29

... an investigative report from the Treasury Department’s Inspector General for Tax Administration, that some lowly I.R.S. officials in a Cincinnati office that deals with applications for tax-free status from philanthropic organizations used words like “Tea Party” and “Patriots” to screen forms for further review. Republican senators and congressmen accused the Obama Administration of using the I.R.S. to intimidate its opponents. Rush Limbaugh spied a White House coverup. The acting head of the I.R.S., Steven Miller, lost his job. Even Jon Stewart flipped his lid...Fast forward a month and a half and Darrell Issa, the intrepid California Republican who heads the House Committee on Oversight and Government Reform (and who was the subject of a 2011 article in the magazine by Ryan Lizza), is still bravely trying to get to the bottom of it all—subpoenaing documents, carrying out interviews, and scheduling hearings. Having earned sixty million dollars in 2012 from his extensive investments, the fifty-nine-year-old Issa could easily be relaxing on the beach in Oceanside or Hawaii: instead, he’s devoting his time and energy to enlightening the public about what was really going on inside the I.R.S. His investigation has turned out to be invaluable, although not necessarily in the way he had planned.

Earlier this month, Elijah Cummings, the ranking Democrat on the Committee, released portions of an interview with one of the I.R.S. officials in Cincinnati who instigated the effort to give extra scrutiny to Tea Party groups and other organizations affiliated with the right. It turned out that this man, who is reportedly John Shafer, a conservative Republican, launched the screening program after an underling noticed a surge in applications from organizations that appeared to be affiliated with the Tea Party. “I do not believe that the screening of these cases had anything to do, other than consistency and identifying issues that needed to have further development,” Shafer said, according to the transcript released by Cummings. Asked if he believed the White House was involved, Shafer replied, “I have no reason to believe that.” Now comes another revelation relevant to Issa’s investigation: I.R.S. employees in Cincinnati also targeted applications from liberal groups for further scrutiny, and they did it for the same reason they singled out conservative groups: a fear that such organizations might turn out to be primarily political rather than philanthropic. (Many political organizations are not eligible for tax-exempt status.) Specifically, the “Be On the Lookout” memos that I.R.S. managers sent to workers in the tax-exempt division instructed them to look carefully at groups with the word “progressive” in their names. “Common thread is the word ‘progressive,’ ” the memo said. “Activities appear to lean toward a new political party. Activities are partisan and appear as anti-Republican.”

The release of the internal I.R.S. documents came as the agency’s new acting head, Danny Werfel, confirmed in a conference call with reporters that the agency’s screening of groups suspected as being political was broader than previously thought, and crossed the political spectrum. In addition to “Tea Party” and “progressive,” the I.R.S. investigators screened for another dozen or so terms. According to lists released by Democrats in Congress, these included “Medical Marijuana,” “Occupied Territory Advocacy,” “Green Energy Organizations,” and “Healthcare legislation.” Back in May, when Miller was being hauled up to Capitol Hill and berated by our elected representatives, I suggested, and others did, too, that the I.R.S. brouhaha was a “non-scandal,” a case for Inspector Clouseau rather than Eliot Ness. With every passing day, it seems like this judgment was sound—not that it was particularly clever or original. To get the real story, all you had to do was read what the I.R.S. told the Inspector General and listen to what people like Miller were saying.

Over to the Columbia Journalism Review’s Ryan Chittum, who has been following this ludicrous saga more closely than I have:

Rather than the Nixonian conspiracy… you have a routine bureaucratic procedure meant to bundle potentially problematic applicants together for further review. The “abuses” the right has screamed about are the same ones that nonprofit journalism applicants like SF Public Press, The Lens, and many others faced, especially long delays and invasive questioning (and, ultimately, approval—no Tea Party group’s application ultimately was denied). Again, this was not some big secret. It was readily available information.

But don’t let any of this stop you, Congressman Issa (and your cheerleaders in the conservative media). If you keep on digging, you might end up being even more discredited than you are already.