Taxable Talk

Do you remember how the IRS scandal began? It began when Lois Lerner made a speech and noted that the IRS erred and targeted conservative and Tea Party 501(c)(4) applicants. This occurred on a Friday afternoon.

Shock of shocks, another bit of news came out on a Friday afternoon of similar importance. The IRS is claiming that they lost Lois Lerner’s emails. For reasons I’ll get to in a few moments, this simply fails the smell test. The IRS says that they’ve made heroic efforts in attempting to recover the missing emails which cover a two-year period.

The problem with the IRS statement is simple: Email moves through email servers. Here’s a post on this at the Blaze with details on how email works. Here’s the concluding paragraph:

“I don’t know of any email administrator that doesn’t have at least three ways of getting that mail back,” [Norman Cilio, a former program manager at Microsoft] added. “It’s either on the disks or it’s on a TAPE backup someplace or in an archive server. There are at least three ways the government can get those emails.”

Mr. Cilio’s conclusion: The IRS is lying.

As an owner of a business in a regulated industry, I’m required to keep my emails (both coming and going). I’m not a technology wizard, but my IT person has told me that we do various backups that keep the information and store them in multiple ways. We use RAID technology–basically, a system where one hard drive is a copy of the working hard drive so if the working hard drive crashes, the backup immediately takes over with no loss of data.

PowerLine has a post noting that the IRS uses similar systems. Lois Lerner’s computer shouldn’t be relevant at all; it’s the IRS email servers and backup systems that are relevant.

House Ways and Means Committee Chairman Dave Camp issued a statement that isn’t as pointed as it likely should be. An excerpt:

“The fact that I am just learning about this, over a year into the investigation, is completely unacceptable and now calls into question the credibility of the IRS’s response to Congressional inquiries. There needs to be an immediate investigation and forensic audit by Department of Justice as well as the Inspector General.

“Just a short time ago, Commissioner Koskinen promised to produce all Lerner documents. It appears now that was an empty promise. Frankly, these are the critical years of the targeting of conservative groups that could explain who knew what when, and what, if any, coordination there was between agencies. Instead, because of this loss of documents, we are conveniently left to believe that Lois Lerner acted alone. This failure of the IRS requires the White House, which promised to get to the bottom of this, to do an Administration-wide search and production of any emails to or from Lois Lerner. The Administration has repeatedly referred us back to the IRS for production of materials. It is clear that is wholly insufficient when it comes to determining the full scope of the violation of taxpayer rights.”

My conclusion is succinct: Either the IRS is deliberately lying or they have the worst IT department and policies of any company, organization, or government entity in the world. I am forced to conclude the IRS is lying.

You remember the IRS scandal? It’s still around, and it appears that the IRS (or highly placed individuals at the IRS) violated the law.

From Eliana Johnson comes a report that begins,

The Internal Revenue Service may have been caught violating federal tax law: In October 2010, the agency sent a database on 501(c)(4) social-welfare groups containing confidential taxpayer information to the Federal Bureau of Investigation, according to documents obtained by a House panel.

Congressmen Darrell Issa and Jim Jordan sent a letter to IRS Commissioner John Koskinen demanding information:

The Committee learned recently that the IRS transmitted 21 disks containing over 1.1 million pages of information about tax exempt groups to the Federal Bureau of Investigation in October 2010 in advance of Lois Lerner’s meeting with the Justice Department about potentially using campaign-finance laws to criminally prosecute certain nonprofit groups engaged in political speech. We were extremely troubled by this new information, and by the fact that the IRS has withheld it from the Committee for over a year. We were astonished to learn days ago from the Justice Department that these 21 disks contain confidential taxpayer information protected by federal law. We ask that you immediately produce all material explaining how these disks were prepared and transmitted to the FBI.

Here are the emails that show this happened:

Violating federal law is a very good reason to take the Fifth Amendment. Now, it might not have been Ms. Lerner who ordered this, but if it wasn’t her she definitely knows who it was.

Additionally, the IRS’s non-cooperation with the House Committee on Oversight and Government Reform and the general IRS attacks on the GOP don’t sit well with the GOP. Until it is learned who ordered the IRS policy on 501(c)(4) organizations, the IRS’s budget will be shrinking, not increasing. Based on what I just read, if anyone is expecting the IRS’s budget to increase this year, well, that has as much chance as it snowing here in Las Vegas tomorrow. (The high is expected to reach just 105 F.)

Congress continues to investigate the IRS scandal, and news this week indicates that it continues. Here’s the first two paragraphs of a Washington Examiner article:

Tea Party officials told a congressional panel Thursday they are still being targeted for harassment despite claims by President Obama and top IRS officials that the illegal activities were stopped last year.

“It’s shocking, it’s repugnant, it’s infuriating,” Becky Gerritson told a subcommittee of the House Oversight and Government Reform Committee. “And most troubling of all, those responsible have not stopped.”

Meanwhile, IRS attorney William Henck has been in the IRS Office of the General Counsel for over 26 years. He wrote a piece for the PowerLine blog. It is one of the most disturbing things I’ve read in quite some time. Here’s an excerpt:

I do not personally know whether the IRS has targeted conservative groups or individuals, but I do know that the environment within the agency is ripe for such activity and there is nothing to prevent it from occurring. As stated in more detail below, I have personally witnessed improper giveaways of billions of dollars to taxpayers with inside access at the agency, bullying of elderly taxpayers, the cover-up of managerial embezzlement and misappropriation of thousands of dollars in government funds, and a retaliatory audit. I have also heard credible accounts of, among other things, further improper giveaways, blatant sexual harassment, and anti-Semitism. All of these matters have been swept under the rug.

I strongly suggest you read the entire thing.

Finally, we have President Obama stating that there was no corruption involved with this scandal. Here’s the quote from an interview he had with FoxNews’s Bill O’Reilly:

O’REILLY: You’re saying no corruption, none?

OBAMA: There was some bone-headed decisions.

O’REILLY: Bone-headed decisions. But no mass corruption?

OBAMA: Not even mass corruption. Not even a smidgeon of corruption.

Really?

Republicans in Congress have cut the budget to the IRS because of the scandal. And whether you’re a member of the GOP, a Democrat, or an independent (politically), Republicans are correct in doing this. As I’ve said before, we need a non-partisan IRS. Until the true cause of the scandal is known (and whatever it is, it’s in Washington, not Cincinnati), we’re all going to pay the price. Sooner or later the news will come out, and most likely to the detriment of those in power in Washington.

The IRS scandal hasn’t gone away. More documents have been released, and they’re not flattering towards Lois Lerner. Government Executive has this:

In a June 2012 email responding to an NPR story discussing the Democratic Senatorial Campaign Committee complaint with the FEC regarding some conservative groups, Lerner speculated to a colleague, “Perhaps the FEC will save the day.”

In a February 2011 email on the Cincinnati-based unit of the Exempt Organizations division assigned to handle tea party groups’ applications, Lerner wrote, “Tea Party Matter very dangerous….Counsel and Judy Kindell need to be in on this one….Cincy should probably NOT have these cases.”

Glenn Reynolds (of Instapundit fame) has a column where he notes Lerner’s statements (from the emails). Mr. Reynolds’ conclusion is that this boils down to trust, and that the IRS and the principals in this scandal have oozed anything but trust.

Politico notes that the players in the IRS scandal have lawyered up with “elite D.C. lawyers.”

Finally, an article in USA Today notes the following:

Newly uncovered IRS documents show the agency flagged political groups based on the content of their literature, raising concerns specifically about “anti-Obama rhetoric,” inflammatory language and “emotional” statements made by non-profits seeking tax-exempt status.

The Administration was probably hoping this scandal would fade into the woodwork. I’m certain that the IRS was hoping for that, too. However, as long as the IRS and the principals involve evade–the official Administration response is still that this was all the work of rogue agents in Cincinnati (nobody believes that anymore)–the scandal will continue to percolate.

Investors Business Daily reported in an editorial that the IRS “selectively advised black churches and other Democrat nonprofits on how far they can go in campaigning for President Obama and other Democrats” during the 2012 campaign. IBD reported that Attorney General Eric Holder and then IRS Commissioner Douglas Shulman spoke to black church leaders at the gathering.

It is the appearance of impropriety that the IRS must avoid. The IRS continues to do a wonderful job of appearing to raise issues with their behavior. And their behavior has almost certainly been a classic example of impropriety.

The IRS made videos parodying Star Trek and Gilligan’s Island. It’s time for another: The Apprentice, IRS Style:

On the bright side, this video only cost us taxpayers $10,000; the Star Trek and Gilligan’s Island parodies cost a reported $60,000 each. What I’d like to see next from the IRS is a parody of Perry Mason where at the end we find out who ordered the IRS to target conservative applicants for 501(c)(4) status.