Free Markets, Free People

IRS


What is the IRS scandal if not political?

Peggy Noonan makes this statement today:

What happened at the IRS is the government’s essential business. The IRS case deserves and calls out for an independent counsel, fully armed with all that position’s powers. Only then will stables that badly need to be cleaned, be cleaned. Everyone involved in this abuse of power should pay a price, because if they don’t, the politicization of the IRS will continue—forever. If it is not stopped now, it will never stop. And if it isn’t stopped, no one will ever respect or have even minimal faith in the revenue-gathering arm of the U.S. government again.

And it would be shameful and shallow for any Republican operative or operator to make this scandal into a commercial and turn it into a mere partisan arguing point and part of the game. It’s not part of the game. This is not about the usual partisan slugfest. This is about the integrity of our system of government and our ability to trust, which is to say our ability to function.

First paragraph … agree, for the most part.  Where I don’t agree is that there is a “minimal faith” in the revenue gathering arm of the US government.  There’s been little faith in it since it’s inception.  Most people understand that the gun is pointed at them and the prison cell is open and waiting.  They don’t pay taxes because of any “faith” or respect for the IRS or government.  They do it out of fear.

As for the second paragraph, that’s total horse hockey.  Total.

The entire point of the scandal was it targeted “political” organizations.  How does one not politicize it?  It took place under a Democratic administration and the opponents of that party were the target of the IRS.

Hello?

And what do we get from Noonan? “Hey, let’s take a knife to a gun fight”.

Noonan’s advice is, by far, the stupidest advice one could give.

Yes, this is about the integrity of the system. And, like it or not, that is directly linked to those who administer and govern.

Ms. Noonan, who is that right now? And how, if they were doing an effective job, would this have been going on for two years. Oh, and speaking of trust, how are you with the whole AP scandal? My guess is you’re wanting some heads over that.

Well, I want some heads of this. And Benghazi. And Fast and Furious.

Instead we get shrinking violets like you advising everyone to back off and not make this “political”.

BS.

~McQ


Is anyone in our government in charge?

So Ed Morrissey points out that the IRS thing has been going on since 2011 and it’s just a “couple of agents” in a single per the official line.  Well, maybe four.

Except the agents in question are claiming only to have done what their bosses wanted.  And their bosses?  We don’t know.  We don’t know who they are.  After all, it was only a couple of letters to a couple of right of center organizations.

But again, per Morrissey, these two – or four – agents were busy little people in that one office.

Did I say 300 organizations? According to the report, Reps. Jim Jordan and Darrell Issa now put that number closer to 500.  If it was just these four agents, they’d have to have been rather, er, productive.

Yeah.  And they did it all over the US and all by themselves for two years.

Is anyone in charge up there?  Does anyone even know what’s going on?  And, if someone is in charge, are we ever going to hold them accountable?

Trust in government?

What trust?

~McQ


So is the media finally being forced to pay attention to this administration’s scandals?

I found this to be very interesting.  From ABC News (email):

THE ROUNDTABLE

ABC’s JEFF ZELENY: The troubles are mounting for the White House – Benghazi, IRS, AP phone records – leading one administration official to ask yesterday: “Is it really still only Monday?” It’s safe to say all three topics are moving into scandal territory, but it’s a mistake to view them together. Of all of the controversies, the IRS seems to be the most troubling because it further erodes trust in government and institutions – from a point that is already distressingly low. At least three Congressional committees are digging in. Even though the president said he didn’t know about the IRS matter until the news broke last week, it happened on his watch. Democrats could have a hard time winning this one. It bolsters the case for Republicans, just in time for the midterm campaign to begin.

ABC’s RICK KLEIN: It comes fast and intense in a second term. And the confluence of events – Benghazi talking points, the IRS scandal, sweeping subpoenas of Associated Press records – leave plenty of reasons to mistrust the government President Obama is leading. Knowing that Congress can’t walk and chew gum very well – it can’t walk all that well without the gum, and this flavor is particularly tasty to the president’s opponents – this is a recipe for stalling and worse for just about anything the White House wants to do. The president’s powers of public persuasion, meanwhile, could ebb in the whiff of scandals. If there’s a White House strategy to turn this all around, we’re not seeing signs of it, not yet.

ABC’s DEVIN DWYER: The talking points coming out of the State Department on Monday were astonishing for their attempted revisionism. Spokeswoman Jen Psaki repeated four times in four minutes that the Obama administration’s early public characterization of the 2012 Benghazi terror attack was dictated by the CIA. “These were CIA points. They were CIA edited. They were CIA finalized,” she said. Nevermind that trove of emails, obtained by ABC News, that shows it was in fact the State Department that sought to edit out the CIA’s references to al Qaeda and to security warnings in Benghazi prior to the attack. “These started and ended as CIA talking points,” Psaki said. Technically, maybe so. But it would be disingenuous to ignore or deny the apparent influence of State during the talking-point sausage-making that occurred in between.

ABC’s SHUSHANNAH WALSHE: The Tea Party groups who say they were unfairly targeted by the IRS showed ABC News questionnaires and documents received from the Internal Revenue Service. They had to answer questions about their donors, views on issues, and one member said she was even asked to show her personal Facebook account, all they say, because of their political views. The agency apologized last week, but these groups don’t feel like they were directly apologized to. All want an investigation, but for Jennifer Stefano who was trying to set up a group called The Loyal Opposition, but finally gave up, she compares this scandal to Watergate: “It became very frightening, the IRS has the power to target the political opposition of a sitting president.”

It’s amazing it has taken these events and this long for these people to actually do their jobs.  And there’s no guarantee they will.  But it can’t be denied any longer — it is on “the” radar screen.  Benghazi, IRS, AP, you name it.  Even the sycophants credulity is being tested.

Maybe it took this administration’s messing with AP to finally make them figure out that for the most part they’ve simply been the media arm of the administration and the administration feels some “ownership” rights.  Thus it was checking on them … or something.

It’ll be interesting to watch this all unfold — or disappear.

~McQ


Observations: The QandO Podcast for 12 May 13

This week, Michael and Dale discuss Benghazi, the IRs and loony David Kokesh.

The direct link to the podcast can be found here.

Observations

As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here.


Is the IRS overstepping its authority in ObamaCare enforcement?

This should be interesting to watch:

A group of small business owners (and individuals) in six states today are suing the federal government over an IRS regulation imposed under the Affordable Care Act (Obamacare), which will force them to pay exorbitant fines, cut back employees’ hours, or severely burden their businesses. Complaint can be viewed here.

The Affordable Care Act authorizes health insurance subsidies to qualifying individuals in states that created their own healthcare exchanges. Those subsidies trigger the employer mandate (a $2,000/employee penalty) and expose more people to the individual mandate.  But last spring, without authorization from Congress, the IRS vastly expanded those subsidies to cover states that refused to set up such exchanges.  Under the Act, businesses in these nonparticipating states should be free of the employer mandate, and the scope of the individual mandate should be reduced as well.  But because of the IRS rule, both mandates will be greatly enlarged in scope, depriving states of the power to protect their residents.

Michael Carvinpartner at Jones Day, who co-argued the Supreme Court Obamacare cases in March, 2012 and who represents the plaintiffs in this lawsuit, stated: “The IRS rule we are challenging is at war with the Act’s plain language and completely rewrites the deal that Congress made with the states on running these insurance exchanges.”

33 states have refused to set up these exchanges.  The IRS, per the complaint, is ignoring that ability given by the states by the law and proceeding as if it didn’t exist.  The argument is the IRS is overstepping it’s authority.

“Agencies are bound by the laws enacted by Congress,” said Sam Kazmangeneral counsel of the Competitive Enterprise Institute (CEI).  “Obamacare is already an incredibly massive program.  For the IRS to expand it even more, without congressional authorization and in a manner aimed at undercutting state choice, is flagrantly illegal.”  CEI is coordinating the lawsuit.

We’ll see.  Given the way the law is interpreted anymore, I wouldn’t at all be surprised to see the IRS upheld (or the suits be dismissed out of hand).  Such is the lack of respect and confidence I hold for our “legal system” anymore.

~McQ


IRS sent 5 billion, with a “B”, to identity thieves

If you’re not very confident in government competence to begin with, this story should add fuel to that fire:

Investigators say the Internal Revenue Service may have delivered more than $5 billion in refund checks to identity thieves who filed fraudulent tax returns for 2011.

They estimate that another $21 billion could make its way to ID thieves’ pockets over the next five years.

$5 billion.  $21 billion in 5 years if the ID thieves can’t be rooted out prior to sending the checks. 

Surely they have a way of doing that.  There have to be simple checks like, oh, I don’t know, an address getting more than one return hoisting a red flag maybe?   Or maybe a single bank account receiving more than one return?

For example, investigators found one single address in Michigan that was used to file 2,137 separate tax returns seeking a total of more $3.3 million in refunds. In other cases, hundreds of refunds were deposited into the same bank account.

Guess not.  Guess these new fangled computers and programming security checks are just beyond them (such a system would likely cost much less than $5 billion, huh?).

IRS incompetence costs you $5 billion.   Add that to the $60 billion a year in Medicare waste, fraud and abuse, and we’re talking real money.  And then just imagine all the other waste, fraud and abuse throughout the rest of the federal government and it isn’t at all difficult to understand why we constantly find ourselves in a deficit situation.  Or why government, in the form of the Obama administration is raising taxes on everyone (see ObamaCare and the new Medicare tax) and wanting to raise them on the “rich” segment of the society.

So it can give it away to ID thieves and Medicare fraudsters, among other grifters.

[HT: Jamie Dodge]

~McQ

Twitter: @McQandO


US Olympic medal winners face a taxing experience

Are you watching the Olympics?  Did you enjoy the gold medal performances of the US women’s gymnastics team?

It was nice to see them bask in the glory of the fruition of all those years of hard work and sacrifice.  They reached the peak of accomplishment.  They took the gold.  The stories of the athletes were as interesting as the victory.  Years of monetary sacrifice, hard work, dedication and practice.  Families, who moved to avail their daughter of coaching,  who lived from paycheck to paycheck to ensure money was available for their daughter’s training, the hundreds of meets and competitions, etc.

But hey, we all know they “didn’t build that” themselves.  They traveled on roads to their practice sites and meets, used other common infrastructure improvements and now they get to pay the piper.

It’s time for them to pay up for winning those gold medals, and the IRS will ensure they do.

At today’s commodity prices, the value of a gold medal is about $675 according to Americans for Tax Reform.  And the gold medal brings with it $25,000 in prize money.  The IRS will tax them at 35%. 

So for all those years of hard work, sacrifice and performance, our gold medalists will pay the IRS $8,986 for each gold medal they win.  The silver will cost them $5,385 ($15,000 prize money, and $385 for the medal) and bronze $3,502 ($10,000 prize money, $5 for the medal).

Of course they’ll be about the only athletes in the world so treated because you see, the US is one of the few countries in the world that takes it upon itself to tax the world wide earnings of its citizens.

Because, you know, that infrastructure is everywhere and it’s expensive. </sarc>

But I’m sure we’ll hear from our usual apologists for intrusive government trying to spin these taxes as something both necessary and proper.

Just a note to them – most Americans don’t at all agree with the sentiment that they didn’t build what they now have.   But you have to hope the Democrats keep trying to sell that.    Our Olympians and their tax experience make as good a case against that as any I can imagine.

~McQ

Twitter: @McQandO


ObamaCare: It just gets better and better

And, of course, I say that facetiously.   As it stands now, it has fostered more government regulation, more bureaucrats and more intrusion in epic proportion:

"There’s already 13,000 pages of regulations, and they’re not even done yet," Rehberg said.

"It’s a delegation of extensive authority from Congress to the Department of Health and Human Services and a lot of boards and commissions and bureaus throughout the bureaucracy," Matt Spalding of the Heritage Foundation said. "We counted about 180 or so."

So, minimally (we all know they’re not nearly done) 13,000 new pages of regulation, 180+ boards, commissions and bureaus and, of course, scads of bureaucrats to fill them.

Then there are the new broad powers granted HHS and the IRS.

Yes, friends, that’s right, this is how you make health care less expensive and better, not to mention making government less intrusive.

Probably the funniest thing, in a sad and ironic way, is the fact that there are still millions of people out there who believe the propaganda that sold this crap sandwich to the public.    Someone among them I’m sure will someday be able to explain how adding costly regulations and layers upon layers of bureaucracy somehow helps reduce the cost of health care delivery.  

According to James Capretta of the Ethics and Public Policy Center, federal powers will include designing insurance plans, telling people where they can go for coverage and how much insurers are allowed to charge.

"Really, how doctors and hospitals are supposed to practice medicine," he said.

Wait, wasn’t one of the primary problems with the old system, per the Democrats, a problem of insurance companies telling doctors how to practice medicine?

See, solved by government, right?

In fact, one master has been replaced by another one, the newest master being the most inept, inefficient and corrupt of the two.  And, of course, no one has yet explained how all of this is going to ensure people have better access to a doctor.  Why?  Because, quite simply, having insurance doesn’t guarantee care.  And with the disincentives provided by massive increases in regulation (and the increase that will cost for compliance) and oversight via these board, commissions and bureaus, my guess is there will be fewer doctors in the future.

So prepare to enjoy the dawning of the age of ObamaCare and the attendant disappointment, shock and anger it will eventually engender among the public.  There are some things that one shouldn’t mess with, and people’s health care is one of them.

Forward.

~McQ

Twitter: @McQandO


Happy Dependence Day!

My how things change over the course of 200+ years.

Back at the beginning of this experiment, people rejected a large and intrusive government.  They’d been the victims of one and threw off that yoke.  They acclaimed freedom as their goal and chose liberty as their battle cry.

When they finally got around to forming their own government, they carefully wrote a document which I’m sure they figured was an iron-clad guarantee that this country’s future would never see the same sort of tyranny they’d suffered under.

I just wonder what they’d think of this sprawling, debt ridden and intrusive mess we have now?  I wonder what they’d think of over half the population getting some sort of compensation from government. 

I wonder what they’d think of a Supreme Court Chief Justice more worried about what they’ll say about him and the court on the cocktail circuit and in the media than he is about upholding the Constitution, his sworn duty.  I think I know.

And I’m pretty sure I know what they’d think of this:

Our nation’s current debt, nearing $16 trillion, and our annual budget deficit of $1.2 trillion, indicate that our government’s addiction to spending is nowhere near its limit.

Of that $16 trillion debt, the U.S. owes more than $5 trillion to foreign nations, an all-time high. So much for independence. We’re now a debtor nation, and unless we get our fiscal house in order, that debt will endanger our nation’s prospects for long-term growth.

If that sounds alarmist, consider this: In August 2011, Vice President Joe Biden visited China. This wasn’t just any diplomatic visit — it was the supplication of a debtor, in which Biden undertook to reassure our Chinese debtors that their investment is sound.

Biden assured his hosts that they had "nothing to worry about" when it comes to the U.S. honoring its obligations. It wasn’t the first time a high-ranking U.S. official has had to offer soothing words to our creditors, and at this rate it won’t be the last.

Let’s be clear.  This administration isn’t the cause of all that debt.  It’s just the latest (and the worst) to add to it, to the point that our debt now stands at more than our GDP.  We are indeed a debtor nation.

That’s not at all how this began is it?  Nor was that ever the plan.

I’m also pretty sure I know how they’d feel about the level of intrusion government now routinely practices (and increases) in this country.  For example:

IRS officials on background tell FOX Business the U.S. Supreme Court ruling on health reform gives the IRS even more powers than previously understood.

The IRS now gets to know about a small business’s entire payroll, the level of their insurance coverage — and it gets to know the income of not just the primary breadwinner in your house, but your entire family’s income, in order to assess/collect the mandated tax.

Plus, it gets to share your personal info with all sorts of government agencies, insurance companies and employers.

And that’s just the tip of the iceberg. "We expect even more lien and levy powers," an IRS official says. Even the Taxpayer Advocate is deeply concerned.

As government takes more and more control of your lives, it intrudes deeper and deeper into them:

The TAO [Taxpayer Advocate Office] says that the “IRS will need to determine a taxpayer’s compliance with the individual [insurance] mandate and assess a penalty if coverage is inadequate.”

However, the penalty isn’t based on just your personal net income. The penalty will be based on an entirely different number that is more than just your paycheck earnings — your ‘household income.’

“This determination is based on a concept of ‘household income,’” TAO has said, adding, “this may differ from the income reported on the taxpayer’s return, because it is a composite of all of the income reported by members of a taxpayer’s household — information that may not be readily accessible to the IRS."

If the IRS finds you have fallen short of the law, it would hit you with a penalty tied to your household income (which may be that of an individual or several family members).

Under the new health law, the IRS penalty would be based on “modified adjusted gross income,” not adjusted gross income that you normally report at the bottom of the first page of your tax form 1040, before you take deductions or personal exemptions.

The modifications add back in things like non-taxable interest and excluded foreign income to this number.

Meaning:

Health reform’s insurance mandate says if you do not have “adequate” insurance, you’ll have to pay a fine as part of your tax return. If your business doesn’t provide “affordable” coverage,  that business may have to pay a fine to the IRS, too, as part of its tax return filings.

The TAO has noted Americans must now tell the IRS under the new law:

    *Insurance plan information, including who is covered under the plan and the dates of coverage;
    *The costs of your family’s health insurance plans;
    *Whether a taxpayer had an offer of employer-sponsored health insurance;
    *The cost of employer-sponsored insurance;
    *Whether a taxpayer received a premium tax credit; and
    *Whether a taxpayer has an exemption from the individual responsibility requirement.

The TAO has warned: “This is different from the type of information the IRS typically deals with, and some taxpayers may feel uncomfortable about sharing it with the IRS.”

In fact, it is incumbent upon you to prove to the IRS that you have “adequate coverage”, whatever that ends up meaning. And:

The TAO has also reported that “obtaining this new information will require the IRS to communicate with entities and government agencies that it may not deal with now,” including:

    *New state-run insurance exchanges;
    *Employers;
    *Insurance companies; and
    *Government insurance programs.

But remember the sales pitch – government will make health care simpler, more cost effective and better.

Congratulations to all the simpletons out there who bought into this scam and ended up foisting this intrusive monstrosity on the rest of us.  In fact, thanks to all, who through out the 200 years it has taken us to to get to this point, worked so hard to achieve it “for the common good”.  </sarc>  Nice mess you’ve given us.

As for the rest of you, happy Dependence day!

Forward.

~McQ

Twitter: @McQandO


IRS to have power to confiscate passport?

Iguess we’ve moved into the realm of “guilty until you prove yourself innocent”:

The Republican House of Representatives may soon follow the Democratic Senate and give the IRS the power to confiscate your passport on mere suspicion of owing taxes. There’s no place like home, comrade.

‘America, Love It Or Leave It" might be an obsolete slogan if the "bipartisan transportation bill" that just passed the Senate is approved by the House and becomes law. Contained within the suspiciously titled "Moving Ahead for Progress in the 21st Century Act," or "MAP 21," is a provision that gives the Internal Revenue Service the power to keep U.S. citizens from leaving the country if it finds that they owe $50,000 or more in unpaid taxes — no court ruling necessary.

Note … “mere suspicion”.  Like the IRS screws up its audit and thinks you owe more than you do (and at least $50k), your passport is yanked without going to court.

Let freedom ring, eh?

And, as the lede points out, it isn’t just the Democrats.  Another attempt by both parties to shred the Constitution.

This is not the sort of power an unaccountable agency should be given.  Any idea of how many people will suddenly find themselves on the wrong end of a suspicion they owe $50k or more in taxes?  Whether true or not, with the power to grab your passport and only a suspicion needed (no court order), the IRS will likely “suspect” many people owe at least that much.

That’s certainly consistent with the history of such granted power. Go to the extreme quickly – there’s no reason not too.  No penalty for them, certainly.  Oh, you don’t owe $50k?  Here’s your passport. 

“Moving Ahead for Progress in the 21st Century”?

Since when is changing the IRS to a form of the KGB a “move ahead?”

~McQ

Twitter: @McQandO