Skip to main content
Part of complete coverage from

With IRS defanged, politics can run rampant

By Gloria Borger, CNN Chief Political Analyst
updated 9:23 AM EDT, Thu May 16, 2013
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
updated 8:21 AM EDT, Mon September 1, 2014
Carlos Moreno says atheists, a sizable fraction of Americans, deserve representation in Congress.
updated 12:25 PM EDT, Sun August 31, 2014
Julian Zelizer says Democrats and unions have a long history of mutual support that's on the decline. But in a time of income inequality they need each other more than ever
updated 12:23 AM EDT, Sun August 31, 2014
William McRaven
Peter Bergen says Admiral William McRaven leaves the military with a legacy of strategic thinking about special operations
updated 12:11 PM EDT, Fri August 29, 2014
Leon Aron says the U.S. and Europe can help get Russia out of Ukraine by helping Ukraine win its just war, sharing defense technologies and intelligence
updated 1:24 PM EDT, Fri August 29, 2014
Timothy Stanley the report on widespread child abuse in a British town reveals an institutional betrayal by police, social services and politicians. Negligent officials must face justice
updated 9:06 PM EDT, Fri August 29, 2014
Peter Bergen and David Sterman say a new video of an American suicide bomber shows how Turkey's militant networks are key to jihadists' movement into Syria and Iraq. Turkey must stem the flow
updated 11:54 AM EDT, Mon September 1, 2014
Whitney Barkley says many for-profit colleges deceive students, charge exorbitant tuitions and make false promises
updated 10:34 AM EDT, Fri August 29, 2014
Mark O'Mara says the time has come to decide whether we really want police empowered to shoot those they believe are 'fleeing felons'
updated 10:32 AM EDT, Thu August 28, 2014
Bill Frelick says a tool of rights workers is 'naming and shaming,' ensuring accountability for human rights crimes in conflicts. But what if wrongdoers know no shame?
updated 10:43 PM EDT, Thu August 28, 2014
Jay Parini says, no, a little girl shouldn't fire an Uzi, but none of should have easy access to guns: The Second Amendment was not written to give us such a 'right,' no matter what the NRA says
updated 1:22 PM EDT, Sat August 30, 2014
Terra Ziporyn Snider says many adolescents suffer chronic sleep deprivation, which can indeed lead to safety problems. Would starting school an hour later be so wrong?
updated 9:30 AM EDT, Fri August 29, 2014
Peggy Drexler says after all the celebrity divorces, it's tempting to ask the question. But there are still considerable benefits to getting hitched
updated 2:49 PM EDT, Fri August 29, 2014
The death of Douglas McAuthur McCain, the first American killed fighting for ISIS, highlights the pull of Syria's war for Western jihadists, writes Peter Bergen.
updated 6:42 PM EDT, Tue August 26, 2014
Former ambassador to Syria Robert Ford says the West should be helping moderates in the Syrian armed opposition end the al-Assad regime and form a government to focus on driving ISIS out
updated 9:21 AM EDT, Wed August 27, 2014
Ruben Navarrette says a great country does not deport thousands of vulnerable, unaccompanied minors who fled in fear for their lives
updated 9:19 AM EDT, Wed August 27, 2014
Robert McIntyre says Congress is the culprit for letting Burger King pay lower taxes after merging with Tim Hortons.
updated 7:35 PM EDT, Tue August 26, 2014
Wesley Clark says the U.S. can offer support to its Islamic friends in the region most threatened by ISIS, but it can't fight their war
updated 4:53 PM EDT, Tue August 26, 2014
America's painful struggle with racism has often brought great satisfaction to the country's rivals, critics, and foes. The killing of Michael Brown and its tumultuous aftermath has been a bonanza.
updated 3:19 PM EDT, Tue August 26, 2014
Rick Martin says the death of Robin Williams brought back memories of his own battle facing down depression as a young man
updated 11:58 AM EDT, Tue August 26, 2014
David Perry asks: What's the best way for police officers to handle people with psychiatric disabilities?
updated 3:50 PM EDT, Mon August 25, 2014
Julian Zelizer says it's not crazy to think Mitt Romney would be able to end up at the top of the GOP ticket in 2016
updated 4:52 PM EDT, Mon August 25, 2014
Roxanne Jones and her girlfriends would cheer from the sidelines for the boys playing Little League. But they really wanted to play. Now Mo'ne Davis shows the world that girls really can throw.
updated 5:04 PM EDT, Mon August 25, 2014
Kimberly Norwood is a black mom who lives in an affluent neighborhood not far from Ferguson, but she has the same fears for her children as people in that troubled town do
updated 5:45 PM EDT, Fri August 22, 2014
It apparently has worked for France, say Peter Bergen and Emily Schneider, but carries uncomfortable risks. When it comes to kidnappings, nations face grim options.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT