The IRS Scandal: Who’s Really Being Gullible?

Some figures on the left have aggressively sought to dismiss the renewed Internal Revenue Service scandal as unserious. Rep. Lloyd Doggett (D-Tex.) captured this mood at one recent Capitol Hill hearing when he suggested that after questioning whether the loss of emails was truly accidental, his GOP colleagues might go on next to quiz the IRS’s leadership about the president’s birth certificate and space aliens in Roswell, N.M. It’s not a “serious inquiry,” Rep. Doggett said. “I believe it’s an endless conspiracy theory here.”

And yet many Americans who do not care about space aliens do doubt the IRS’s account of what has happened. While we covered the story a year ago as well as more recently, this might be a good time to recapitulate why.

The IRS grants 501(c)(4) nonprofit status (less favorable than (c)(3) tax status, which affords donors charitable deductibility) to a wide array of “social welfare” organizations--many, like the ACLU, with a definite ideological valence. In recent years the status has been sought and obtained by groups whose missions are closely related to campaign and electoral politics, most notably Organizing for America, whose role on the national scene is to support President Obama’s messaging. Not surprisingly this has excited controversy about whether the eligibility rules for (c)(4) status are being drawn in the right place. Most advocates profess to believe, though, that whatever the right set of rules, they should apply alike to all sides in our political life.

By March 2012 the Associated Press was reporting on a flurry of bizarre and seemingly unprecedented IRS demands that some (c)(4) applicants of a right-of-center valence provide extraordinarily burdensome and intrusive documentation of their activities--things like copies of all books and literature distributed to participants, transcripts of leaders’ radio appearances and live speeches, printouts of all Facebook and Twitter output, and so forth, along with donor lists and names of family members. The IRS was also delaying groups’ approval for long periods--in fact, seemingly indefinitely--without explanation or a firm denial that could be appealed to a court. Defenders of the agency leadership subsequently put out a search for left-of-center groups that might have run into similar treatment, and although they did manage to turn up a few tales of bureaucratic red tape and rigmarole, they were unable to come up with anything remotely comparable.

IRS nonprofit chief Lois Lerner at first denied any targeting, then sought to blame rogue employees at the IRS Cincinnati office for it. But emails soon emerged clearly indicating guidance by high-level IRS managers in Washington. Lerner then declined to testify, asserting her Fifth Amendment privilege against admissions tending to expose herself to criminal liability.

Through the ensuing scandal, there was little hard proof that Lerner and other IRS insiders had coordinated the targeting with political actors outside the agency--on Capitol Hill, say, or in party organizations, or the White House--although a number of details on the record, such as frequent White House visits by agency insiders and coordination with outside figures on press messaging, made for suggestive circumstantial evidence. To establish that political operatives or officials outside the agency were aware of targeting at the time, or even perhaps instigated or directed it, would be to blow the scandal wide open, perhaps threatening the careers of well-known public figures. If any email documentation of such coordination is to be found, it would most likely be in the “external” (outside the agency) emails of Lerner and other key players in the targeting effort.

Those are the same emails that have now mysteriously vanished, supposedly because of a crash of Lerner’s computer--a crash that happened 10 days after the House Ways & Means Committee wrote her to inquire about (c)(4) tax exemption denials.* Emails of six other key IRS employees are also said to have vanished in a series of coincidental crashes.

This week, as if to confirm that shabby treatment of politically disliked adversaries was not unheard-of at the Lerner-era IRS, the agency agreed to pay $50,000 to the National Organization for Marriage over an episode in which persons unknown leaked the group's confidential return and donor list to its ideological adversary, the Human Rights Campaign, which proceeded to have it published. And the Ways & Means Committee has just released an email indicating that when an invitation intended for a congressional opponent wound up by mistake in the hands of Lerner, her immediate reaction was to wonder whether it might be used to generate an IRS investigation embarrassing to the opponent.

After all those revelations, is it really those who distrust the agency’s leadership whose credulity should be compared to that of flying saucer cultists? Or are the blinkered believers the ones who insist that the each new jaw-dropping IRS revelation must have an innocent explanation, even if the earlier ones did not?

*An earlier version of this post described the letter to Lerner as being about targeting; Glenn Kessler at the Washington Post has disputed whether that is an accurate way to describe the contents of the letter, which concerned a plan to audit conservative (c)(4) donors. Ian Tuttle responds to Kessler here.

[Cross-posted, with minor revisions, from Overlawyered.com.]