Obama to Legalize Illegal IRS Abuses with a New Executive Order

The observation, “money is the mother’s milk of politics,” is credited to Jesse “Big Daddy” Unruh (1922-1987) (D-CA), who was named Speaker of the California State Assembly, and later, State Treasurer.  The quotation is still used as a classic political truism. If you doubt that, just notice the number of contribution requests that fill the TV screens and clutter your mailbox, and the fact that more than half the members of Congress are millionaires! Even the most rudimentary political campaigns cost many thousands of dollars to launch, and even more to keep the elected bureaucrats in office. Of course, nobody ever makes a significant contribution to a political candidate without expecting something in return. I believe it’s called “cronyism.”

Every few years our elected representatives will pledge to keep financial favors out of politics by codifying taxpayer funded campaigns, encouraging you to check a block on your 1040 for a voluntary campaign contribution, or passing such legislation as the McCain-Feingold Act to clean up political campaigns once and for all.

Of course, the McCain-Feingold Act it didn’t work. It wasn’t supposed to. For the reason mentioned initially, those who supported the Act still wanted the money. So even though individual contributions were limited, contributions to “political action groups,” or PACs, were not. Well, sometimes they were and sometimes they weren’t. So to favor one special interest group or the other, they created “Super PACs,” “Leadership PACs,” etc., each with its own set of rules. If you are really interested, click here.

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However, public laws are messy. They take time, and aren’t always predictable. What to do? Just issue an Executive Order, of course. President Obama has publicly stated that he would act on his various schemes “with or without Congress.” Democrat political strategist Paul Begala exuberantly described President Obama’s actions as, “Stroke of the pen, law of the land. Kinda cool.”

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So it was an easy move for the Administration to instruct the IRS to develop two tax code exemptions, 501c3 and 501c4, to encourage or discourage political campaign activity.

Obviously, elected officials want to encourage financial contributions as much as possible, and declaring them to be exempt from federal taxation is one such method of encouragement. So if you contribute to a PAC that is covered by one of these two codes, it is exempt from federal taxation. Why two codes? Politics, of course.

501c3 is extended to those organizations we would generally consider appropriate for tax exemption; civic leagues, public charities, civic organizations. 501c4 approval exempts those groups who claim to be civic organizations, but also do political campaigning. If a political organization is denied such exemption, it is placed at a significant disadvantage. So IRS withholding or delaying such approval from Tea Party and other Conservative groups was one of the Obama scandals that was widely recognized as seriously hindering the efforts of his political opposition, and contributing heavily in assuring his re-election. But it was so obvious, and so illegal, that public perception was that the Obama administration had raised political “dirty tricks” to an unprecedented level.

After his re-election, the President was appropriately embarrassed. In a public statement last May 15th, President Obama promised, “First, we’re going to hold the responsible parties accountable.  Second, we’re going to put in place new safeguards to make sure this kind of behavior cannot happen again.”

But holding his political cronies “accountable” wasn’t a viable option, and “safeguards” have never worked. So what to do? Simple. Legalize the illegal. You know, “Stroke of the pen. . .”

Kimberly Strassel writing in the Wall Street Journal is reporting that the Obama administration, just in time for the 2014 mid-term elections, is now in the process of creating a new Executive Order that would legalize the type of abuses of power it committed during the 2012 IRS scandal when Tea Party and Conservative non-profit groups were targeted, and would, “isolate and shut down the same Tea Party groups victimized in the first targeting round.”

She goes on to write:

This “proposed guidance”—while technically pending public comment—puts conservative groups on immediate notice that it could be enforced at any moment. It is clearly designed to have a chilling effect on any group gearing up for next year’s midterms, just as the first round of targeting was designed to dampen conservative participation in the 2010 and 2012 elections.

Democrats are daily directing government against their political opponents—via Congress, the SEC, the FEC. Yet IRS Acting Commissioner Danny Werfel wants Americans to think this latest IRS rule is just about providing “clarity.” And the White House continues to insist that it was unaware of the previous targeting.

The political insult is that President Obama is using his new targeting rule to wiggle out of liability for the last round. The same president who in May was “outraged” by the IRS’s actions now says it was all just some confusion over tax law (which his new rule fixes). He told Chris Matthews last week that the media had hyped what was a few poor IRS souls in Cincinnati who were “trying to streamline what is a difficult law to interpret . . . And they’ve got a list, and suddenly everybody’s outraged.”

Everybody was outraged to discover the IRS was secretly targeting the president’s political opponents. They might be more outraged that the White House is now using the IRS to do the same thing in the brazen light of day.

Everybody was outraged to discover the IRS was secretly targeting the president’s political opponents. They might be more outraged that the White House is now using the IRS to do the same thing in the brazen light of day.

Of course the new regulation would not apply to the legitimate 501c3 groups, nor would it apply to labor unions which have their own separate 501c5 code. Rather, it would only target 501c4 groups, which the Democrats feel have been effective vehicles for conservative advocacy.

Imagine that.

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