Topic: Government and Politics

IRS IT: $2.4 Billion But Not World-Class

Perhaps the most suspicious thing about the disappearance of Lois Lerner’s emails is that the IRS is not a small business operation that cannot afford high-quality computer, email, and backup systems. It is a huge modern bureaucracy that has computer technology at the core of its operations. The IRS IT budget in 2014 is a massive $2.4 billion (page 149 here).

Here is what the administration’s most recent IRS budget says (page 150) about its IT strategy:

IT is a key enabler for efficient and effective tax administration … To ensure the public trust, the IRS also is making significant investments to secure infrastructure, data, and applications. With continued investment in new technologies and the modernization of existing IT systems, the IRS is improving service to taxpayers, achieving productivity gains, and distinguishing itself as a model of tax administration around the world. The IRS also has established world-class practices and tools to manage and implement its portfolio of IT investments more efficiently.

There is no doubt that the IRS has distinguished itself recently, but not as a model of world-class practices.

Obamacare FYI: Page 147 shows that IRS IT costs for the ACA will be $345 million in 2014. Page 32 shows that IRS IT costs for the ACA over 2010-2018 will be $1.9 billion.

How Far Can Congress Delegate Its Legislative Authority?

The Supreme Court this morning announced that in its next term it will hear oral argument in a case called Department of Transportation v. Association of American Railroads, which asks whether Congress, when it passed the Passenger Rail Investment and Improvement Act of 2008, unconstitutionally delegated its legislative power to a private entity—in this case, Amtrak. The non-delegation doctrine, grounded in the separation of powers, arises from the very first word of the Constitution, after the Preamble: “All legislative Powers herein granted shall be vested in a Congress of the United States ….” (emphasis added). Taken at face value, that clear a statement would seem to preclude much of the “lawmaking” that goes on every day in the 300 and more executive branch agencies to which Congress over the years has delegated vast regulatory authority. Unfortunately, the Court long ago held otherwise, unleashing the modern executive state, indulged no more assiduously that by President Obama with his resort to “pen and phone” as he wills his agencies to action, the will of Congress often notwithstanding.

This case, however, challenges the next step in undermining the constitutional doctrine: again, whether Congress can delegate its lawmaking authority to a private entity. In time, one hopes, the case may sow the seeds for the Court’s revisiting the main form of legislative delegation, if only by putting the issue in play. That was at least implicit in the opinion below from the D.C. Circuit, written by the irrepressible Judge Janice Rogers Brown and joined by Senior Judges Stephen Williams and David Sentelle, each of whom has been a presence at Cato. In fact, it was only three weeks ago that Judge Williams was here, commenting on Professor Philip Hamburger’s new book entitled, appropriately, Is Administrative Law Unlawful?—the broad question at issue here.

As with so many administrative law cases, DOT v. AAR involves a complex tangle of agencies and authorities that the reader will be taxed to untangle. But Judge Brown put the principle of the matter plainly: “While often phrased in terms of an affirmative prohibition [as with rights], Congress’s inability to delegate government power to private entities is really just a function of its constitutional authority not extending that far in the first place. In other words, rather than proscribing what Congress cannot do, the doctrine defines the limits on what Congress can do.” This is one to watch.

Can Private Disaster Relief Work?

In a new paper, Emily Skarbek (King’s College London) presents some evidence:

Using a novel set of comprehensive donation and expenditure data collected from archival records, this paper examines a bottom-up relief effort following one of the most devastating natural disasters of the nineteenth century: the Chicago Fire of 1871. Findings show that while there was no central government relief agency present, individuals, businesses, corporate entities and municipal governments were able to finance the relief effort though donations. The Chicago Relief and Aid Society, a voluntary association of agents with a stake in relief outcomes, leveraged organizational assets and constitutional rules to administer aid.

This contrasts sharply with conventional wisdom and current public policy, which assumes that private agents and local governments will “free ride” on the charitable actions of others, leading to “insufficient” relief activity unless the central government plays a large role.

In fact, private and local government efforts are often substantial, as demonstrated by this example and many others (e.g., the billions given by individuals, foundations, and corporations to help victims of Katrina, Sandy, and the Asian Tsunami).

Local efforts, moreover, are likely more efficient than those directed by a far away central government, as residents of New Orleans can readily attest.

Kim Strassel and the WSJ on the Lost IRS Emails

Earlier this week Wall Street Journal columnist Kim Strassel won a much deserved Bradley Award for her work in investigative journalism. It’s at times like this, in which revelations about evidence destruction at the Internal Revenue Service almost defy belief, that everyone interested in American governance should follow her column and the Journal editorial page.

Some highlights since the email story broke last Friday: 

* According to Strassel’s column today, the contents of Lois Lerner’s hard drive were wiped out by forces unknown “about 10 days after the Camp letter arrived,” that is to say, a letter from House Ways and Means Chairman Dave Camp inquiring into targeting of conservative groups. (Lerner then replied to Camp denying targeting and subsequently pleaded the Fifth before Congress.) 

* A WSJ editorial this morning points out the remarkable timing of the IRS’s begrudging disclosure last Friday that evidence central to the case has been destroyed: more than a year after the investigation began and only when a deadline was impending in which the IRS commissioner would have to certify personally that the agency had produced to Congress all relevant communications. Were responsible agency officials determined to treat this as a high-priority investigation, to be carried on in good faith and with all deliberate speed? (There was no doubt about the seriousness of the scandal, as President Obama himself admitted—or seemed to be admitting—at the time.) Or did they instead stall and deflect until the very last moment? So un-forthcoming was the agency that, according to today’s Journal editorial, IRS staffers met with Sen. Orrin Hatch (R-Utah) Monday and did not tell him that the external emails of six other IRS employees had gone missing too—he found that out only later in the week when he read a press release from the House side.  

* While some IRS critics focus almost to the exclusion of all else on the possible role of the Obama White House in directing the IRS, Strassel and the WSJ correctly will not let us forget that much of the pressure on the agency was coming from Congress itself. In particular, Sens. Carl Levin (D-Mich.), Dick Durbin (D-Ill.), and Chuck Schumer (D-N.Y.), along with Reps. Chris Van Hollen and Elijah Cummings (both D-Md.), were among many Democrats seeking to enlist the IRS in a crackdown on politically antagonistic nonprofits.

Thank heavens for Kim Strassel and her colleagues at the WSJ, because otherwise it would seem as if few in the press were willing to focus serious investigative attention on this extraordinary scandal. (Many other press outlets have treated it as a dull page-A-18 story, run wire service coverage only, or–as with the New York Times–waited three days even to notice it.) 

People used to ask how Watergate might have turned out if the press had sided with Nixon instead of against him. Thanks to the work of Strassel and her WSJ colleagues, let’s hope we never find out.

Mission Accomplished, He Said

Everything that American troops have done in Iraq, all the fighting and all the dying, the bleeding and the building, and the training and the partnering — all of it has led to this moment of success. Now, Iraq is not a perfect place.  It has many challenges ahead.  But we’re leaving behind a sovereign, stable and self-reliant Iraq.

Yes, that was President Obama at Fort Bragg, North Carolina, on December 14, 2011.

For another perspective, former vice president Dick Cheney in the Wall Street Journal Wednesday:

Rarely has a U.S. president been so wrong about so much at the expense of so many. 

In case there’s any doubt – he means President Obama, not the president who launched the war that cost 4,487 American soldiers’ lives, 32,000 Americans wounded, some 100,000 to 500,000 Iraqi deaths, and as much as $6 trillion.

Maybe they should have listened to the Cato Institute back in 2001 and 2002.

Lessons from Stamp Collecting

My mom recently handed me a large bag of stamps she had collected as a child. There are thousands of stamps from about 100 countries, most from the 1910s to the 1950s. It’s a treasure trove.

My daughters and I started digging through them, and we checked out Internet resources on philately, a hobby I know little about.

Here are a few observations:

  • Most old postmarked stamps are worth relatively little. I guess the reason is high supply and low demand.
  • The world’s first postage stamp was the British Penny Black in 1840, which portrayed Queen Victoria. Stamps were introduced as part of U.K. postal reforms to cut government waste and mismanagement. The first U.S. stamps in 1847 showed Franklin and Washington. Canada’s first stamp in 1851 did not show a government leader, but instead the clever and industrious beaver.
  • Great Britain used to rule a vast area of the globe, and dozens of nations had the British monarch on their stamps. And many countries used to honor American liberty on their stamps, such as these fascinating issues from the 1930s. I doubt whether that happens much anymore.

America Should Stay Out of Iraq and Stop Trying to Fix the World

KILIS, TURKEY—Syria’s civil war has washed over Turkey’s border, flooding the latter with hundreds of thousands of refugees. Washington’s efforts to solve the crisis so far have yielded few positive results. George W. Bush’s grandest foreign policy “success,” the ouster of Saddam Hussein, is turning into an even more dramatic debacle. 

The region is aflame and U.S. policy bears much of the blame. Washington’s relentless attempt to reorder and reshape complex peoples, distant places, and volatile disputes has backfired spectacularly.

The blame is not limited to Barack Obama. However ineffective his policies, they largely follow those of his predecessors. Moreover, his most vociferous critics were most wrong in the past. Those who crafted the Iraq disaster now claim that keeping U.S. troops in Iraq would have prevented that nation’s current implosion ignores both history and experience.

Rather than acknowledge their own responsibility for that nation’s implosion, they prefer to blame President Obama, who merely followed the withdrawal schedule established by President George W. Bush, who failed to win Baghdad’s agreement for a continuing U.S. force presence before leaving office. Exactly how President Obama could have forced sovereign Iraq to accept a permanent U.S. garrison never has been explained. 

Even less clear is how American troops could have created a liberal, democratic, and stable Iraq. Intervening today would be a cure worse than the disease. Air strikes, no less than ground forces, would simultaneously entangle the United States and increase its stakes in another predictably lengthy conflict.