Don't Hurt People and Don't Take Their Stuff: A Libertarian Manifesto (8 page)

During his term as president, John F. Kennedy used the IRS to target conservative nonprofits and other political foes, as well as to obtain the confidential tax information of rich conservatives H. L. Hunt and J. Paul Getty.
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Robert Kennedy commissioned a report from labor leader Victor Reuther on “possible administration policies and programs to combat the radical right.” The report argued for using the IRS as a weapon. “Action to dam up these funds may be the quickest way to turn the tide.” Reuther suggested denial of tax-exempt status and investigations of corporations suspected of being right-wingers. Reuther said: “[T]here is the big question whether [they] are themselves complying with the tax laws,” indicating that he may have supported audits against these organizations.
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Richard Nixon’s presidency ended abruptly for crimes including his willingness to use the IRS to selectively punish his political enemies. Former IRS chief Johnnie Mac Walters reports that under Nixon, he was handed an enemies list of two hundred people and instructed that the White House wanted them “investigated and some put in jail.”
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Nixon, of course, resigned his office when faced with the possibility of impeachment for his crimes, and for repeatedly engaging “in conduct violating the constitutional rights of citizens.” According to Article 2 of the Articles of Impeachment:

He has, acting personally and through his subordinates and agents, endeavoured to obtain from the Internal Revenue Service, in violation of the constitutional rights of citizens, confidential information contained in income tax returns for purposed
[sic]
not authorized by law, and to cause, in violation of the constitutional rights of citizens, income tax audits or other income tax investigations to be initiated or conducted in a discriminatory manner.
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Historically, IRS abuse seems to follow a pattern. In 2001, the academic journal
Economics & Politics
published an empirical study of IRS audits and concluded that, “Other things being the same, the percentage of tax returns audited by the IRS is markedly lower in states that are important to the sitting president’s re-election aspirations. We also find that the IRS is responsive to its oversight committees.”
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A
N
O
FFER
Y
OU
C
AN’T
R
EFUSE

So, is abusing the power of the IRS just politics as usual? John F. Kennedy and Bill Clinton did it, but so did Richard Nixon and George W. Bush.

Was the IRS just taking orders from President Obama, and from powerful Senate Democrats like Dick Durbin and Max Baucus, all of whom publicly, loudly telegraphed their desire for the IRS to go after certain sinister 501(c)(4)s?

Or is there something even more ominous going on?

There is real evidence that Lois Lerner is a partisan with an ax to grind, and is willing to use her positions of power to advance her personal agenda. In 1996 she used her position as a Federal Elections Commission lawyer to go after Illinois U.S. Senate candidate Al Salvi, a Republican challenging Senator Dick Durbin. Late in the election, Salvi was hit by an FEC complaint filed by the Democratic National Committee, a charge that would dominate the headlines for the remainder of the campaign, which Salvi lost to Durbin. The charges were later dropped in court as frivolous, but not before Lois Lerner put Salvi through a bureaucratic and legal wood chipper.

It started off with an offer Salvi couldn’t refuse: “Promise me you’ll never run for office again, and we’ll drop the case,” she told him.

Salvi said he asked Lerner if she would be willing to put the offer into writing.

“We don’t do things that way,” Salvi said Lerner replied.

Salvi then asked how such an agreement could be enforced.

According to Salvi, Lerner replied: “You’ll find out.”

The aspiring Republican never ran against Durbin again. “It was a nightmare,” Salvi says now. “Why would anyone run for office again after all that?”
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In September 2013, new emails surfaced that directly contradicted the timeline set out in Lerner’s original ABA mea culpa. These emails directly rebutted the claim that the targeting of tea partiers was not politically motivated. “Tea Party matter very dangerous,” she emailed her staff in February 2010. “Cincy should probably NOT have these cases.”
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Reacting to an NPR article emailed to her by a fellow staffer, titled “Democrats Say Anonymous Donors Unfairly Influencing Senate Races,” Lerner responded, “Perhaps the FEC will save the day.”
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Data suggest that Lerner isn’t the only IRS employee with an agenda. According to Tim Carney at the
Washington Examiner,
“IRS employees also gave $67,000 to the PAC of the National Treasury Employees Union, which in turn gave more than 96 percent of its contributions to Democrats. Add the PAC cash to the individual donations and IRS employees favor Democrats 2-to-1.” In the Cincinnati office, every political donation made in 2012 by employees went to either Barack Obama’s reelection campaign or to liberal Democratic senator Sherrod Brown.
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C
ONCENTRATED
B
ENEFITS
AND
D
ISPERSED
C
OSTS

Public choice economists argue that government decisions on how money is spent and who benefits from regulation are driven in large part by the various interests that stand to win or lose. The payoff for successfully influencing the political decision-making process can be highly motivating. These are the “concentrated benefits” that special interests seek when they show up in Washington to lobby. Those who don’t show up—the rest of us—don’t typically even know that our ox is about to be gored on their table. Even if we did, the cost of showing up and attempting to influence the outcome of legislative horse-trading would be prohibitive. So knowingly or not, we all incur the “dispersed costs” of bigger government.

It’s typically less of a goring, and more of a slow bleed. More like a frog in a pot of water slowly brought to boil. You don’t really know it’s happening. Pennies more for the sugar you buy at the grocery store, or the gradual devaluation of the dollars in your pocket through the Fed’s expansion of money and credit supplies. These are just a few of the countless other ways that the incestuous self-dealing of Washington insiders transfers wealth from you to them.

But sometimes the costs are vivid, and people rise up in protest. It’s happening more and more as the costs of good, real-time information plummet. It happened in 2008, when America opposed a $700 billion bailout of Wall Street. It is happening again in public opposition to ObamaCare, particularly over the unjust transfer of wealth from younger, poorer Americans to older, wealthier ones. The president’s health-care reboot grows increasingly unpopular years after its enactment. People are discovering the hard way that the political promises made to buy the votes needed to pass the massive scheme were mostly expedient lies. More and more people want out of the new government exchanges.

Acting IRS chief Danny Werfel is one of those people. Testifying at a hearing, he told the House Committee on Ways and Means that “I would prefer to stay with the current policy that I’m pleased with rather than go through a change if I don’t need to go through that change.”
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His view is echoed by the National Treasury Employees Union—yes, IRS employees have union representation—who are aggressively lobbying to keep their members out of ObamaCare. Here is the opening paragraph of the letter the unions asked members to send to Capitol Hill:

I am a federal employee and one of your constituents. I am very concerned about legislation that has been introduced by Congressman Dave Camp to push federal employees out of the Federal Employees Health Benefits Program (FEHBP) and into the insurance exchanges established under the Affordable Care Act (ACA).
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So they are looking to exempt themselves from the same onerous law that the IRS is enforcing on us? Are you kidding me? What happened to equal treatment under the laws of the land? As outrageous as that sounds, consider this: The IRS commissioner who oversaw the exempt organizations division of the IRS from 2010 to 2012, the very time frame when the agency was targeting conservative and libertarian groups, is now in charge of the new division at the IRS enforcing ObamaCare. Her name is Sarah Hall Ingram, and she directly reported to Lois Lerner.
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Ingram and her new army of IRS enforcement agents will be imposing fines on young people who choose not to be conscripted into ObamaCare. But thanks to an Office of Personnel Management (OPM) ruling, IRS employees, other federal employees, and the politicians and their staffs who drafted and enacted ObamaCare are all effectively exempt. Through President Obama’s personal request, OPM is allowing members of Congress to retain benefits conferred by the Federal Employees Health Benefits Program, despite the fact that ObamaCare would otherwise require them to purchase the same health insurance programs available to the population at large.
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ObamaCare for thee, but not me? Depends on whom you know in Washington.

T
HE
I
NSIDERS
V
ERSUS
A
MERICA

What if we have reached a tipping point in America, where the progressive dream of a protected class of civil servants has turned into something else completely? What if the hope of change is really just a big, powerful, selectively abusive, and very expensive nightmare? It used to be well understood, or at least widely believed, that they worked for us. We were taught in high school civics that members of Congress and the president and all government workers were, in fact, employees of We the People.

What if public servants now represent a privileged class, the most powerful special interest group in the world? Consider this: In 2011, the federal government had 4,403,000 employees.
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To lend perspective to this number, consider that Wal-Mart has fewer than half this number of employees, coming in at 2.1 million, and McDonald’s has only 1.9 million.
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Of course, no one believes that the nice lady who greets you when you enter your local Supercenter is out to get you. She is there to help you. That nice lady, and the Wal-Mart she works for, really work for you and your return patronage.

When is the last time you felt that way about a federal government employee?

What’s most remarkable about the IRS targeting of conservative and libertarian grassroots organizations is the length and scope of the practice. The discrimination against the IRS’s self-categorized “tea party cases” was an agency-wide practice that was discovered, broadly known about, discussed up the chain of command, and continued for years. Watergate was the product of a few bad actors, and the malfeasants were caught, stopped, and brought to justice.

This is a big deal, a potential tipping point where the self-interests of bureaucrats looking to protect their jobs dovetailed nicely with a chief executive, in an election year, looking to protect his job. Think of the implications of the federal government as the largest special interest group in the world.

Do they work for us, or we them?

Becky Gerritson, president of the Wetumpka (AL) Tea Party and a target of the IRS, answered this question unequivocally in her unbending testimony before the House Ways and Means Committee:

I am not here today as a serf or a vassal. I am not begging my lords for mercy. I am a born-free, American woman—wife, mother and citizen—and I’m telling MY government that you have forgotten your place. It is not your responsibility to look out for my well-being or monitor my speech. It is not your right to assert an agenda. The posts you occupy exist to preserve American liberty. You have sworn to perform that duty. And you have faltered.
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Becky’s testimony “went viral” on YouTube, fueled by the simple, commonsense values that she personified, values that I believe still define America.

The American ideal is about your liberty, not their power.

It’s no longer Republican versus Democrat. It’s not about good government or bad government. It’s not even “liberal” versus “conservative.” It’s about limiting the government’s monopoly on force and unleashing our freedom to try, to choose, to take responsibility, and to make things better. It is about the political elites and the insiders they collude with versus America.

It’s Them versus Us, for sure.

CHAPTER 4

G
RAY-
S
UITED
S
OVIETS

If you give me six lines written by the hand of the most honest of men, I will find something in them which will hang him.

—CARDINAL RICHELIEU
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IT’S NOT PARANOIA IF
they really are out to get you.

The Internal Revenue Service systematically targets its critics: average American citizens simply trying to comply with complex laws, and simply exercising their First Amendment voice in the public debate.

The attorney general authorizes wiretaps on the phones of reporters at the Associated Press. The National Security Agency spies on you, presuming your guilt until proven otherwise.

The Orwellian-named Affordable Care Act (neither affordable nor caring) will collect all of your personal data, from an alphabet soup of federal agencies including the IRS, DHS, and DoD—even your private health insurance information. All of this “private” information will be centralized in a sweeping government “data hub” housed in the Department of Health and Human Services.

The elected members of Congress and their staffs who drafted and enacted the ACA—better known as ObamaCare—and the career “civil servants” at the IRS, NSA, and HHS—all of them to be trusted with so much discretionary power over your life and information about you—are seeking to exempt themselves from the same laws they will impose on us.