Letter 2 America for May 17, 2013

Dear America,

It's notable to me that the Republicans in congress are saying nothing about substantive issues these days, preferring to attempt to capitalize on what they see as missteps by the Democrats and the Obama administration.  Since the emergence of the IRS "scandal" involving the taxonomy of applications for tax exempt status under section 501(c)(4) of the IRS code, even Benghazi has taken a back seat in the faux-pas-mongering of the Republicans, and I believe whole heartedly that the IRS problem was just that: a faux pas.  I can't say what the political climate was like in the offices of the IRS in which there was supposed political discrimination against conservative  applicants for that status, but in Connecticut, the campaign season ads we saw on television from groups that claim to be non-political 501(c)(4) "social welfare groups" were anything but non-political, a criterion for this type of tax exempt status.  For example, if you saw an ad run by Karl Rove's Crossroads GPS group, you were not left in doubt as to the group's political affiliations or alignment, but the donations to that organization were eligible for tax deduction under the IRS code because of Crossroads GPS's putative status as a non-profit "social welfare organization."  Thus, distinguishing between truly non-political organizations and those with party or candidate affiliations is not easy, even for the IRS.  If Crossroads GPS qualifies, why not the Republican Party?  If you add to this equation the fact that you don't need IRS approval to declare yourself a 501(c)(4) social welfare organization, you realize that seeking an IRS determination that you are one has ulterior purposes, and as it turns out, only one of those purposes is to ensure the deductibility of donations of massive size.  Another is the fact that, while a 501(c)(3) organization has to disclose the identities of its donors since it is a political organization, a 501(c)(4) organization does not, and there is the frame for this picture.  Purported social welfare organizations as defined by the IRS Code can take deductible donations from the ultra-rich without disclosing that the ultra-rich gave them...but they are not supposed to be political.  They can't be in the business of influencing legislation, which you can read as lobbying.  They cannot be advocates for political candidates or parties, which you can read as campaigning for candidates.  But obviously, the social welfare organizations that are the biggest do just those things...and that is what they were created to do.  So what's a poor IRS agent to do when an application comes in for predetermined 501(c)(4) status?  He needs some guidance, and apparently a few low level supervisors came up with a solution: look carefully at any organization that proudly wears the badge of a political action group like the Tea Party in its name.  And that's what brought us to today.  Some government workers were looking for a systematic way to do their jobs, and it caused them to seize upon an obvious indicator of a forbidden characteristic in an organization: its name.  Seems logical to me, and to a lot of other people as well, I'll bet.  

Never-the-less, there will be an investigation, and what they will find, I predict, is that of the three denials of organizations seeking social welfare organization status, all of them were justified, and as to whether laws were broken, the status sought by the other seven hundred odd applicants is not an entitlement, nor is it even necessary for their purposes.  It is only a prediction of how the IRS will rule on any claim of tax deductibility for contributions made, mostly by the .1% donors who actually run those of them that are political in reality...oh, and a guaranty that no one will ask who they are.  Neither is what I would call a solid distinction, that is, it is advisory in nature for the IRS to declare an organization non-political in this way...a guide line...not a form of social or political status.  Thus, though the determination to use this taxonomic method may be revealed to reflect a lack of analytic or creative thinking, it was anything but discriminatory in some invidious sense.  It was more exasperation with the deceit of a few than an attempt to deprive them of anything to which they were entitled, but since the Republicans think that their ox has been gored, they will by marching on the castle like town's folk carrying torches looking for a monster, and they will create one if they can...a Democrat no doubt.  But when it comes to real issues, the Republicans have had little success lately.  For example, when did you last hear a Republican complain about energy policy.

You may remember that even as recently as the last election, Republicans were complaining that our dependence on foreign oil and the high price of gasoline and fuel oil were the fault of the Obama administration.  They were undaunted by the fact that BP had poisoned the Gulf of Mexico when they demanded a renewal of the permitting process for deep water drilling because we were in such dire need of more crude...supposedly.  But as it turns out, we have been exporting gasoline from our refineries at the record rate of about 500,000 barrels per day according to the Energy Information Agency, a department of the federal government.  And while our oil companies do so, we import approximately 300,000 barrels per day from Europe here in the Northeast.  In fact, the refineries on the XL pipeline--you may remember the Republican bellowing about the Nebraska governor's and the Obama administration's reservations about the pipeline as an election issue too--export about 60% of the gasoline they produce while despoiling our gulf coast with refineries and pipes, all of this begging the question, what is the point of pursuing energy independence if we will just export what we produce in consequence of it anyway.  Demand for petroleum products has fallen by 9% in the United States since its peek in 2005 and production has risen to its highest level since 1988, but prices continue to rise even though we have done what we were told was necessary to reduce demand for foreign oil and oil company profits are at record levels.  With all that in mind, Republicans can't dwell on the issue without begging the question of whose side they are on--a question that arises whenever they talk about real issues like immigration, the national debt and deficit, and tax reform as well.  Naturally, they are looking for other ways to succeed at the polls.  And they always resort to the tactics they are using now because their supply-sider obsessions won't win them any votes with the American public.  So we can expect this head hunt at the IRS to be front page news for some time, and the hearings about Benghazi will be ceaseless for the foreseeable future.  Until the next mid-term election in 2014, the Republicans will be trying to point the finger at the other guy because they aren't saying anything they want the American voter to hear.  The question is--given the fact that they got away with it in 2010--will they get away with it again.  I mean, how long can they keep up this hyperbole about nothing without the voting public saying, "So what?"  I mean, all they have on Benghazi is that the CIA couldn't tell the administration who did it or why for a couple of days after the murders, so a UN diplomat made a public guess that was wrong.  So what?  And as to the IRS, they were looking for culprits, and where better to look than among the usual suspects.  So what?

Your friend,

Mike