Six Months Later, No White House Ties in IRS Probe

WASHINGTON, DC - JUNE 27:  Acting Internal Revenue Service (IRS) Commissioner Danny Werfel testifies during a hearing before the House Ways and Means Committee June 27, 2013 on Capitol Hill in Washington, DC. The committee held a hearing on the IRS review of taxpayer targeting practices.
National Journal
Shane Goldmacher
Oct. 23, 2013, 2 p.m.

It has been six months since the news broke that the In­tern­al Rev­en­ue Ser­vice was tar­get­ing tea-party groups for ex­tra scru­tiny last spring.

Since then, in­vest­ig­at­ors with the House Ways and Means Com­mit­tee have re­viewed more than 300,000 doc­u­ments and in­ter­viewed more than two dozen IRS of­fi­cials, some more than once. Law­makers from both parties say a clear por­trait has emerged of a troubled and un­ac­count­able agency that over­reached when it came to over­see­ing non­profits.

What they haven’t yet found is any dir­ect ties link­ing the White House to the scan­dal.

“I think there’s no ques­tion it’s a scan­dal based on gross mis­man­age­ment from the very top cir­cu­lat­ing all the way down the ranks,” said Rep. Charles Bous­tany, R-La., the chair­man of Ways and Means’ Over­sight Sub­com­mit­tee that is lead­ing the probe. “We have con­cerns about wheth­er there’s a polit­ic­al scan­dal. We haven’t veri­fied that yet.”

But pa­tience among Ways and Means Demo­crats, es­pe­cially rank­ing mem­ber Sander Lev­in of Michigan, is wear­ing thin. Since the scan­dal first broke, it has emerged that it wasn’t just tea-party groups that were on the agency’s con­tro­ver­sial “be on the lookout” lists. Some left-lean­ing or­gan­iz­a­tions were on there, too.

Lev­in has said the pan­el’s Re­pub­lic­ans have been so fo­cused on mak­ing polit­ic­al hay of the scan­dal that they have fo­cused in­suf­fi­ciently on mend­ing the mis­man­aged tax agency. And he notes that their fo­cus on link­ing the scan­dal to the White House hasn’t turned any­thing up.

Bous­tany re­sponds that he and his col­leagues are simply do­ing due di­li­gence by look­ing in­to a broken bur­eau­cracy and try­ing to fer­ret out wheth­er the ad­min­is­tra­tion ex­er­ted any un­due in­flu­ence. “If we hit a wall and we can’t prove that, then so be it, if that’s what the facts tell us — but we have to get to that point,” he said. “Suf­fice it to say the in­vest­ig­a­tion is not nearly com­plete.”

The probe didn’t start out so par­tis­an and con­tro­ver­sial. In fact, back in May, com­mit­tee Chair­man Dave Camp, R-Mich., and Lev­in is­sued a joint state­ment call­ing for the IRS to turn over doc­u­ments, and to­geth­er they ex­ped­ited the cal­en­dar to sched­ule a hear­ing.

But the good­will began to evap­or­ate by the end of Camp’s open­ing re­marks, when he de­clared of the Obama ad­min­is­tra­tion, “This ap­pears to be just the latest ex­ample of a cul­ture of cov­er-ups.”

Lev­in was taken aback. The probe had barely be­gun, and Camp was talk­ing about a cov­er-up. Lev­in quickly changed his pre­pared state­ment to re­spond to the charge.

“We star­ted on a bi­par­tis­an basis, but it went down­hill and they have tried to use the IRS for purely polit­ic­al pur­poses,” Lev­in said in an in­ter­view earli­er this month.

The tax-writ­ing com­mit­tees of Con­gress have been one of the last refuges of bi­par­tis­an­ship on Cap­it­ol Hill. Camp, Lev­in, and their coun­ter­parts in the Sen­ate — Fin­ance Com­mit­tee Chair­man Max Baucus, D-Mont., and rank­ing mem­ber Or­rin Hatch, R-Utah — con­tin­ue to push ahead on the first com­pre­hens­ive re­write of the na­tion’s tax code in a quarter cen­tury.

But the IRS probe has sapped man-hours and strained some of the re­la­tion­ships key to mov­ing for­ward on tax re­form. “Dave Camp has been very much in­flu­enced by, and of­ten guided by, the rad­ic­al­iz­a­tion of the Re­pub­lic­an Party,” Lev­in said.

The Ways and Means in­vest­ig­a­tion is one of three sim­ul­tan­eous con­gres­sion­al in­vest­ig­a­tions in­to the IRS; oth­er probes are by the Sen­ate Fin­ance Com­mit­tee and the House Over­sight pan­el, chaired by Rep. Dar­rell Issa, R-Cal­if. While Issa, an ag­gress­ive and me­dia-hungry in­quis­it­or, has grabbed many of the head­lines in re­cent months, only the Ways and Means Com­mit­tee’s in­vest­ig­at­ors are al­lowed to peek at priv­ileged tax­pay­er in­form­a­tion, giv­ing them the clearest view in­side the tax agency’s op­er­a­tions.

More in­ter­views are sched­uled and more doc­u­ment dumps from the IRS are ex­pec­ted in the com­ing months. Bous­tany said that the probe, which began by fo­cus­ing on the IRS’s Cin­cin­nati of­fice, has now be­gun ex­plor­ing evid­ence of sys­tem­at­ic tar­get­ing in the Dal­las branch. Even­tu­ally, he said, he wants to work his way to Wash­ing­ton and the IRS’s chief coun­sel, one of only two ad­min­is­tra­tion ap­point­ments at the agency.

“We need to work “¦ all the way up to the seni­or lead­er­ship,” Bous­tany said. “We wanted to get the facts from the bot­tom first, which I think would make for a much more thor­ough in­vest­ig­a­tion”¦. You get one crack at these guys when you do these in­ter­views, and we want to know what ques­tions to ask.”

Stacy Kaper contributed to this article.
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