Tax Analysts Blog

Lost Lerner E-mails Latest Example of IRS Death Wish

Posted on Jun 23, 2014

Lois Lerner can’t escape from her role as a villain in Washington. She is at the heart of the exempt organization scandal that simply won’t die. The latest round of the increasingly partisan and bizarre saga is the announcement that Lerner’s e-mails from two critical years during the targeting of conservative EO applications have been lost and the hard drive that contained them recycled.

By now almost everyone knows the basic facts of the EO scandal, along with who Lerner is. She was the head of the EO function and used a planted question at the 2013 ABA tax section meeting in Washington to reveal the Service’s inappropriate handling of some 501(c)(4) applications. Her central role in the story was cemented by numerous inappropriate communications that have been released by Republicans (including communications to the FEC, a joking reference to seeking a job with the Obama campaign, a speech at Duke in which she said it was on the IRS to deal with the Citizens United fallout, and numerous instances in which she apparently misled Congress about the targeting of conservative groups before she admitted to it in May 2013) and her assertion of her Fifth Amendment rights during a House Oversight Committee hearing.

In February IRS Commissioner John Koskinen learned that Lerner’s e-mails from 2009 through 2011 had been lost because of a damaged hard drive. Those e-mails have repeatedly been requested by congressional committees investigating the scandal, with the IRS only giving bits and pieces and complaining about a lack of resources. Apparently, it was much easier than everyone thought to turn over the e-mails since so many were missing. Koskinen, of course, defended the IRS during a June 20 hearing before the House Ways and Means Committee, but he didn’t provide much of an answer on why he failed to notify Congress in February about the lost information. Republicans on the committee, including Chair Dave Camp, Paul Ryan, and Kevin Brady, all said they didn’t believe Koskinen’s testimony about the e-mails, leading to a testy exchange in which the commissioner promised to stand on his record. Republican Rep. Peter Roskam said the Obama administration was using that successful past record to cover up incompetence at the IRS and predicted that Koskinen wouldn’t serve out his full term, something the commissioner also denied. Koskinen refused to apologize and said he didn’t think an apology was owed.

In contrast to their GOP colleagues, Democrats rushed to Koskinen’s defense. That is, perhaps, understandable, even though much of what the IRS has done during this scandal is indefensible. Democrats probably want to defend their president’s pick to head the IRS, and maybe they want to try to change the narrative heading into a potentially disastrous midterm election. But the reality is that the IRS isn’t doing them any favors. There’s only so much incompetence and disingenuous behavior that can be run through a political spin machine. The Democrats’ reflexive defense of Lerner (whose conduct can’t be excused) and their apparent willingness to accept any explanation from Koskinen (who didn’t even try to adequately explain why he hid information on the lost e-mails from February until late June) is baffling. Democrats weakly attempted to paint the GOP as on a witch hunt for a conspiracy, as though the IRS’s mismanagement and appearance of bias weren’t enough to justify congressional inquiry.

Is there a conspiracy or coverup? Christopher Bergin eloquently explained why it’s hard to know and why that doesn’t matter because tax administration has been damaged either way. And that’s the key point. Lerner, former acting Commissioner Steven Miller, and many other officials have engaged in conduct that might have irreparably harmed the Service’s reputation on Capitol Hill and that once again undermined the public’s trust in the nation’s tax collector. And Democrats’ desperate attempts to rush to the president’s defense to limit the damage to their party’s electoral chances will not fix that problem. Instead, the solution will take serious soul-searching at the IRS and a commitment to being genuinely open and transparent with lawmakers and taxpayers.

Read Comments (12)

AMT buffJun 23, 2014

Does the administration not realize how this situation looks? Or do they simply
not care how it looks? Neither possibility makes sense. This administration is
full of smart people who care about perceptions.

If they cared about appearances they would agree to an independent prosecutor
-- unless they knew that a prosecutor would discover corruption. Now there's a
possibility that makes sense.

I can't think of another reasonable explanation. Can you?

vivian darkbloomJun 23, 2014

"What, exactly, has been "indefensible?"

Paul Burns, inadvertently I suspect, has given us the best possible answer as
to "what is indefensible":

"A bunch of lunatic right-wingers tried to take advantage of a long-standing
regulation..."

Well, there you have it in a nutshell. *A bunch of lunatic right-wingers tried
to take advantage*. The very fact that a bunch of purportedly "right wingers"
tried to take advantage of a regulation is reason enough for (selective)
enforcement of a regulation. No mention here of "liberal" or "progressives".
Not only are those groups presumably not only not "lunatic", but they are
enlightened and therefore worthy of enjoying a very long-standing
interpretation of a regulation that Mr. Burns deems not in accord with the
intent of Congress.

I suspect that Lois Lerner and many of her colleagues within the IRS (and her
political friends outside it) had exactly the same narrow focus and political
bias as Mr. Burns demonstrates here. *That* is what is indefensible for an
agency that is supposed to enforce our tax laws in a politically neutral
fashion.

Paul BurnsJun 23, 2014

What, exactly, has been "indefensible?" A bunch of lunatic right-wingers tried
to take advantage of a long-standing regulation that is far more lenient than
the underlying statute to obtain a tax benefit that Congress never intended
them to have (if you really think that the 1959 501(c)(4) regs even get past
Chevron step one, please post your analysis), and they were very forthright
about their intentions. So the IRS set out to, you know, administer the
statute, albeit in a ham-handed and tone-deaf way. Where's the beef?

Christopher BerginJun 23, 2014

Paul Burns, with all due respect, the whole thing is indefensible -- and
that's from someone who started out defending the IRS in this. Denial is a
river in Egypt, and we need to get to the truth. Where's the beef? Maybe in
some of the "lost" email. I agree with Jeremy Scott that what we need now is
open transparency; not any more excuses.

amt buffJun 23, 2014

Paul, didn't left-wingers start this ball rolling many years earlier with
MoveOn and Media Matters? Why didn't the IRS act against them?

Why did the IRS show no interest in abuse of Section 501(c) for political
purposes until right-wingers followed suit? Why was the interest one-sided? The
questions answer themselves.

edmund dantesJun 23, 2014

To understand why conservatives are so angry about the IRS, to understand why
they won't let this go, you have to recognize that there is no material
difference between moveon.org and the Tea Parties. None. Yet moveon.org went
about it's business unmolested by the government and untroubled by the IRS for
a decade. When the Tea Parties tried to get on the same field, the government
brought out the big guns against them. That is fundamental unfairness, and it
will be redressed.

The Tea Parties were a spontaneous, populist uprising around the country. They
were ordinary citizens getting involved in politics for the first time. They
were most emphatically not "lunatic right wingers." They were not
"professionals" and so made many mistakes. But they were fed up with
government as usual, they saw no significant difference between the two
parties, they spoke truth to power, and they were agents of positive change.

Only a lunatic left winger would think otherwise.

Jersey Girl in VAJun 23, 2014

This responds to E. Dantes' comment that the tea partiers are not "lunatic
right wingers." I disagree. I live in VA's 7th Congressional District, the
same district that just unseated Eric Cantor 2 wks. ago. To drive around this
area of VA you cannot help but notice the bright yellow signs on the roadside
which are put up by the Mechanicsville Tea Party. These signs are consistently
anti-Democrat, vitriolic, bigoted and a testament to the low-information voters
who seem to get their information from Fox news and other right-wing media.
I've learned to ignore them. If you don't laugh, you'll cry.

vivian darkbloomJun 23, 2014

Jersey Girl,

Let's take these complaints one by one:

1. Large yellow signs.

Oh, my. Of course they should be blue?

2. Anti-Democrat.

Nota bene the capital "D" and the fact that they are not accused of being
"anti-democratic", but "Anti-Democrat". If these were consistently,
"Anti-Republican" that would presumably not constitute "lunacy".

3. Vitriolic.

In other words, bitterly scathing or caustic. I'm not sure that would make one
a "lunatic", but l can see that a Democrat might feel that way. By the way,
this conversation got started by someone calling a group "lunatics". That does
not qualify as "vitriolic"?

4. Bigoted.

In other words, ignorant and perhaps intolerant of the views of others. See
above, number 3.

The last two might well apply to Jersey Girl, particularly since she seems
inclined to ignore the views of the "Tea Party" and likely also gets her news
from a suitably left-wing source that satisfies her pre-conceived political
notions. I would also add "anti-democratic" to the list.

Of course, all of this is irrelevant to the issue at hand. Politics are,
unfortunately, ugly. Partisans of all persuasions express views and use
language (and colorful signs!) that are offensive to those on the other end of
the political spectrum. The job of the IRS is not to make judgements as to
whose speech is worthy and whose is not and who qualifies as a "lunatic".

Again, like Mr. Burns, Jersey Girl is a good example of the self-righteous
sentiment that is likely behind the IRS targeting. Those groups are offensive
because their views don't coincide with their own. These two appear to be so
deep in their own partisan world that they are incapable of seeing that.

edmund dantesJun 24, 2014

Jersey Girl, I'll readily concede that *some* tea partiers are "lunatic right
wingers." There muse be wide variability around the country in how much
influence they have in local movements. Certainly most of Tea Partiers I've
met (admittedly, not in VA) are not lunatics, and many were not even right
wingers.

On the other hand, one didn't have to be a "lunatic" to vote against Eric
Cantor. I'll wager that you voted against him yourself.

To paint the entire Tea Party movement based upon its most extreme elements is
unfair, one might even say bigoted. To smear all people who come into
political activity with a sincere belief in smaller government as "lunatics" is
destructive and divisive. Yet that is what the mainstream media did from the
beginning of the Tea Party movement, and it is what you have done today as
well. A few lawn signs don't represent the views of the entire Tea Party.

Here are some observations on the consequences of the Establishment's attempt
to silence and shut out the Tea Party.

Key takeaway: " When you make a conscious decision to deprive people of their
voices, you may not like who they choose to speak for them." That might just
be the result you are observing in Mechanicsville.

BTW, I don't watch Fox News (don't have cable) and only rarely listen to Rush
Limbaugh (I'm usually at work when he broadcasts).

Hank WoosterJun 24, 2014

Koskinnen is a FATCAt who was made rich by his Freddie Mac days - his net worth
is possibly 27m as per federal disclosures. He sits there smiling like a troll
with that "you ain't gonna do anything to me - I own this town" look. In any
democracy he and others like him would be run out of town with tar and feathers.

@Jersey girl: maybe you'd feel better in... Jersey? Can you give an example of
a "bigoted" sign?

Hl MencanJun 24, 2014

Is it generally illegal for the White House staff to ask IRS staff for
individual taxpayer information, even if it the info is a request for a ruling?
If so, doesn't that raise the stakes of the lost Lerner email game? Or does
everybody else already realize this?

Jack FergusonJun 29, 2014

The real investigation of the irs will take place once the groups who have
progressed in federal court (Z Street, Judicial Watch, et al) under judicial
oversight and discovery as to what happened with the emails. Democrats can cry
politics when the Republicans inquire, but that does not work with a judge(s)
appointed by Democrats.

The irs has a losing track record in court, as Christpher Bergin has pointed
out, and the veneer will be lifted. The irs will be better off in the long run
once the facts finally come out, but bipartisan congressional reform will have
the final say and the sides are dug in for now.

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