The NYT reports on a two-year-and counting IRS examination of a conservative Hollywood group. The group seeks the same status as its much larger liberal counterpart, “People for the American Way”. No problem for the latter, naturally.
A Freedom of Information demand, meanwhile, has resulted in a trove of E-mails between the EPA and opponents of the Keystone pipeline showing what is described as “a cozy relationship” between the agency and environmental groups. I‘d call it more than that.
In a USA Today column yesterday entitled “Government Conspiracy Theories aren’t Crazy”, law professor Glenn Reynolds points out the danger of this politicization of our government agencies – here’s an excerpt:
His answer: 9.5. Other tax experts on the panel called it “awful,” and said that it has done “tremendous damage.”
I think that’s right. And I think that the damage extends well beyond the Internal Revenue Service. In fact, I think that the government agency suffering the most damage isn’t the IRS, but the National Security Agency. Because the NSA, even more than the IRS, depends on public trust. And now that the IRS has been revealed to be a political weapon, it’s much harder for people to have faith in the NSA.
As I warned President Obama back in 2009 after he “joked” about having his enemies audited, the IRS depends on trust:
Should the IRS come to be seen as just a bunch of enforcers for whoever is in political power, the result would be an enormous loss of legitimacy for the tax system. Our income-tax system is based on voluntary compliance and honest reporting by citizens. It couldn’t possibly function if most people decided to cheat. Sure, the system is backed up by the dreaded IRS audit. But the threat is, while not exactly hollow, limited: The IRS can’t audit more than a tiny fraction of taxpayers. If Americans started acting like Italians, who famously see tax evasion as a national pastime, the system would collapse.
Since then, of course, the new “weaponized IRS” has, in fact, come to be seen as illegitimate by many more Americans. I suspect that, over time, this loss of moral legitimacy will cause many to base their tax strategies on what they think they can get away with, not on what they’re entitled to. And when they hear of someone being audited, many Americans will ask not “what did he do wrong?” but “who in government did he offend?”
This is particularly true since the Obama administration is currently changing IRS rules to muzzle Tea Partiers.