Skip to main content
Part of complete coverage from

With IRS defanged, politics can run rampant

By Gloria Borger, CNN Chief Political Analyst
May 16, 2013 -- Updated 1323 GMT (2123 HKT)
STORY HIGHLIGHTS
  • Gloria Borger: After IRS scandal, it's open season for political nonprofits
  • She says the agency was wrong to target conservative groups
  • Still, the IRS is needed to keep political groups from posing as nonprofits, she says
  • Borger: IRS focused on small fry, left big organizations free to spend on politics

(CNN) -- One of the most perverse results of the IRS's lame, overzealous -- and possibly criminal -- behavior in looking into the tax-exempt applications of assorted advocacy groups is this: They're a lot safer from scrutiny today than they were yesterday.

After this IRS mess, who in government is going to be in a rush to take on -- or try to regulate -- the groups they should actually be looking at as political operations, overt or covert? Um, not many.

Here's the real deal: It's an open secret in Washington that some of these groups, which spent huge amounts of money during presidential campaigns, are politically aligned. Whatever their "labels," as the IRS might call them, they have been tax-exempt because they claim to be dealing with issues rather than elections. That is, policy, not political candidates. But in the heat of a general election, when policy is politics, how can anyone tell the difference?

Gloria Borger
Gloria Borger

Priorities USA is a Democratic brand; Karl Rove's Crossroads GPS isn't likely to do anything other than help the GOP. To gain their tax-exempt status, they're supposed to promote the "social welfare." What, exactly, does that mean?

It's a complicated question that has become infinitely more complex in the wake of the Supreme Court's Citizens United decision, which allowed corporations to start donating directly to activist groups. Suddenly, the potential of getting some dibs on their considerable money grew larger. The groups designated as 501(c)(4) became the perfect pots to hold the dough, and they swelled, literally and figuratively. And the IRS didn't do much about it.

It might have been a better idea, rather than embarking on what seems like a potentially criminal political fishing expedition, to actually take a look at the huge amounts of money being spent out in the open during the last campaign.

Rumsfeld: Scandals are the perfect storm

Why wasn't the IRS "scrutinizing the big fish," asks Paul Ryan, the chief lawyer for the Campaign Legal Center, a watchdog group that has pushed (unsuccessfully) for the IRS to investigate these groups. "The IRS needs to be focused on the big fish and not on the little Mom and Pop tea party groups, and certainly not based on their political ideology."

Ah, but that's exactly what happened -- and, as a result, these groups that, according to some estimates, collectively spent over $250 million on candidates during the last election are still tax-exempt. Can it be that the IRS investigators were so silly, clueless and unaware of their appropriate role? Alas, yes.

But the legal eagles reading and interpreting the IRS laws are obviously a lot smarter. In its description of the 501(c)(4) category, the IRS lays it out pretty plainly. "Examples" of organizations under this statute that would be considered tax-exempt, it says, are "civic associations and volunteer fire companies." Hmmm. Not exactly political in any way, shape or form. What's more, the IRS also makes it clear that, in order to qualify, the burden is to prove that "your organization is organized exclusively (italics mine) to promote social welfare."

But according to Ryan, the gremlins (i.e. the lawyers) have managed to figure out a way to get around this. The new "perceived line," he explains, is that all these groups need to do is spend less than half of their money on politics. He calls it the "tax lawyer community interpretation." Huh? Is that how we're running the government?

So if these groups spend less than half of their money on politically related activism, the dough they collect from big corporations and donors can be used for campaign activities, all without disclosure of where the money came from.

This has not escaped the notice of Congress, especially Democrats who have been outgunned by Republican-leaning groups.

"We urge you to protect legitimate section 501(c)(4) entities by preventing non-conforming organizations that are focused on federal election activities from abusing the tax code," seven Democratic U.S. senators wrote then-IRS Commissioner Douglas Shulman last year.

What makes sense is for the IRS to make sure that its laws are followed. Citizens can at least expect that their government might know the difference between quashing political dissent and legitimate inquiry. Fishing expeditions on political-sounding names is just stupid, if not venal.

And now, the obvious -- and perverse -- consequence of the IRS bungling: It has just made the world safer for tax lawyers. Your taxpayer dollars at work.

Follow us on Twitter @CNNOpinion.

Join us on Facebook/CNNOpinion.

CNN's Kevin Bohn contributed to this article.

ADVERTISEMENT
Part of complete coverage on
April 17, 2014 -- Updated 1845 GMT (0245 HKT)
Michael Bloomberg and Shannon Watts say Americans are ready for sensible gun laws, but politicians are cowed by the NRA. Everytown for Gun Safety will prove the NRA is not that powerful.
April 17, 2014 -- Updated 1328 GMT (2128 HKT)
Ruben Navarrette says Steve Israel is right: Some Republicans encourage anti-Latino prejudice. But that kind of bias is not limited to the GOP.
April 16, 2014 -- Updated 2323 GMT (0723 HKT)
Peggy Drexler counts the ways Phyllis Schlafly's argument that lower pay for women helps them nab a husband is ridiculous.
April 16, 2014 -- Updated 1642 GMT (0042 HKT)
Rick McGahey says Rep. Paul Ryan is signaling his presidential ambitions by appealing to hard core Republican values
April 16, 2014 -- Updated 1539 GMT (2339 HKT)
Paul Saffo says current Google Glasses are doomed to become eBay collectibles, but they are only the leading edge of a surge in wearable tech that will change our lives
April 15, 2014 -- Updated 1849 GMT (0249 HKT)
Kathleen Blee says the KKK and white power or neo-Nazi groups give haters the purpose and urgency to use violence.
April 16, 2014 -- Updated 1156 GMT (1956 HKT)
Sen. Sheldon Whitehouse and Rep. Henry Waxman say read deep, and you'll see the federal Keystone pipeline report spells out the pipeline is bad news
April 16, 2014 -- Updated 1153 GMT (1953 HKT)
Frida Ghitis says President Obama needs to stop making empty threats against Russia and consider other options
April 15, 2014 -- Updated 2129 GMT (0529 HKT)
Peter Bergen and David Sterman say the Kansas Jewish Center killings are part of a string of lethal violence in the U.S. that outstrips al Qaeda-influenced attacks. Why don't we pay more attention?
April 15, 2014 -- Updated 1641 GMT (0041 HKT)
Danny Cevallos says families of the passengers on Malaysian Airlines Flight 370 need legal counsel
April 14, 2014 -- Updated 1523 GMT (2323 HKT)
David Frum says Russia is on a rampage of mischief while Western leaders and Western alliances charged with keeping the peace hem and haw
April 14, 2014 -- Updated 1156 GMT (1956 HKT)
Most adults make the mistakes of hitting the snooze button and of checking emails first thing in the morning, writes Mel Robbins
April 14, 2014 -- Updated 1754 GMT (0154 HKT)
David Wheeler says as middle-class careers continue to disappear, we need a monthly cash payment to everyone
April 14, 2014 -- Updated 1155 GMT (1955 HKT)
Democrats need to show more political spine when it comes to the issue of taxes.
April 14, 2014 -- Updated 1555 GMT (2355 HKT)
Donna Brazile recalls the 50th Anniversary of the Civil Rights Act as four presidents honored the heroes of the movement and Lyndon Johnson, who signed the law
April 14, 2014 -- Updated 1317 GMT (2117 HKT)
Elmer Smith remembers Chuck Stone, the legendary journalist from Philadelphia who was known as a thorn in the side of police and an advocate for the little guy
April 13, 2014 -- Updated 1856 GMT (0256 HKT)
Al Franken says Comcast, the nation's largest cable provider, wants to acquire Time Warner Cable, the nation's second-largest cable provider. Should we be concerned?
April 11, 2014 -- Updated 1522 GMT (2322 HKT)
Philip Cook and Kristin Goss says the Pennsylvania stabbing attack, which caused grave injury -- but not death, carries a lesson on guns for policymakers
April 11, 2014 -- Updated 1906 GMT (0306 HKT)
Wikipedia lists 105 football movies, but all too many of them are forgettable, writes Mike Downey
April 11, 2014 -- Updated 1432 GMT (2232 HKT)
John Sutter and hundreds of iReporters set out to run marathons after the bombings -- and learned a lot about the culture of running
April 11, 2014 -- Updated 1649 GMT (0049 HKT)
Timothy Stanley says it was cowardly to withdraw the offer of an honorary degree to Ayaan Hirsi Ali. The university should have done its homework on her narrow views and not made the offer
April 11, 2014 -- Updated 1416 GMT (2216 HKT)
Al Awlaki
Almost three years after his death in a 2011 CIA drone strike in Yemen, Anwar al-Awlaki continues to inspire violent jihadist extremists in the U.S, writes Peter Bergen
April 12, 2014 -- Updated 0121 GMT (0921 HKT)
David Bianculli says Colbert is a smart, funny interviewer, but ditching his blowhard persona to take over the mainstream late-night role may cost him fans
April 10, 2014 -- Updated 1731 GMT (0131 HKT)
Rep. Paul Ryan says the Republican budget places its trust in the people, not in Washington
April 10, 2014 -- Updated 2128 GMT (0528 HKT)
Aaron David Miller says Obama isn't to blame for Kerry's lack of progress in resolving Mideast talks
April 14, 2014 -- Updated 1522 GMT (2322 HKT)
David Weinberger says beyond focusing on the horrors of the attack a year ago, it's worth remembering the lessons it taught about strength, the dangers of idle speculation and Boston's solidarity
April 10, 2014 -- Updated 1632 GMT (0032 HKT)
Katherine Newman says the motive for the school stabbing attack in Pennsylvania is not yet known, but research on such rampages turns up similarities in suspects and circumstances
April 9, 2014 -- Updated 1839 GMT (0239 HKT)
Wendy Townsend says the Rattlesnake Roundup -- where thousands of pounds of snakes are killed and tormented -- is barbaric
ADVERTISEMENT