STAFF NEWS & ANALYSIS
Huffington Post: The IRS Was Right
By Staff News & Analysis - May 16, 2013

The IRS Was Dead Right To Scrutinize Tea Party … Lost in the latest political scandal is a simple fact: The Internal Revenue Service was acting in the public interest when it opted to train its auditing power on the Tea Party and affiliated groups. In castigating government as the root of all evil while portraying taxation as a form of tyranny, the Tea Party is no less than a mass celebration of the evasion of the basic responsibilities of American citizenship. Common sense alone tells you that people drawn to its ranks may feel extra temptation to find ways to limit what they surrender to the rogue federal bureaucrats who have supposedly seized the nation. – Huffington Post

Dominant Social Theme: If you advocate fewer taxes it is only right and proper that you are subject to extra scrutiny.

Free-Market Analysis: This is something of a novel concept. The IRS was correct to scrutinize Tea Party and conservative nonprofit applications more closely because these entities were anti-tax.

According to this article, the basis of the IRS scandal is that officials lied about the policy rather than explaining it properly. Here's more:

The cover-up is the bad part here, as in nearly all Washington scandals. It's not the act itself that delivered the real trouble — in this case, a campaign unleashed in the Cincinnati offices of the IRS to scrutinize with particular rigor the applications for tax-exempt status submitted by Tea Party-affiliated groups. Rather, it was what happened afterwards that poses the problem: Officials at the IRS lied to members of Congress about what was actually going on.

That's how we got here, to this full-blown scandal with all the usual rituals — an event that lends validation to seemingly every crackpot idea a conservative group has ever leveled at the Obama administration. (The fact that the Justice Department simultaneously got caught on an overreach of its own, seizing a trove of correspondence from journalists, hardly helps the administration deflect the well-earned wrath of critics.)

But let's get back to the primary act at issue here: The IRS — an agency loved by no one and responsible for stocking the Treasury with federal tax proceeds, due under the law — appears to have devoted unique effort to making sure that Tea Party organizations were not fudging the paperwork in their bids to secure tax exemption.

Good for the IRS.

Like any institution, the agency has limited resources at its disposal. The notion that everyone ought to be treated the same, with auditing powers sprayed around like a lawn sprinkler, is ridiculous. Cops concentrate patrols in high-crime areas. And while we properly decry racial profiling and odious tactics like New York City's Stop and Frisk campaign — through which people are subject to police pat-downs for no other reason than their being black and male — no one would criticize the police for keeping an eye on people who are openly encouraging criminal behavior.

Which gets us back to the Tea Party. Here is a group that has made no effort to hide its contempt for the very institution of taxation. This is what it says on the website of the Cincinnati Tea Party: "Individuals need to have a direct connection between their efforts and the fruits of their labor. This is the magical spark that has led the United States from a loosely conglomerated political experiment into the most exceptional, strongest and most powerful nation on earth. Too many taxes and regulations ultimately serve to snuff out that spark."

We are living in a time of startling inequality, long-term joblessness, entrenched poverty and the breakdown of middle-class opportunity. Our classrooms are crumbling. Whole cities are consumed by neglect and deterioration, while suburban communities now contend with foreclosure, homelessness and despair. Government alone cannot fix any of these problems, but government clearly has a role to play. Government must boost investment in education and spur innovation through support for research. Government must maintain a safety net for people in need. All of this costs money.

The Tea Party stands for many things, but a big part of its message is that sending money to Washington amounts to the perpetuation of a dangerous welfare state that's intent on turning America into a helpless land where our lone skill is filling out the forms to go on the dole.

Isn't it reasonable to assume that people who hold such beliefs might feel additional motivation to pursue grey areas and loopholes at tax time? Wouldn't the people who oversee federal coffers have been derelict had they not at least had a good look?

There is something doubtful and even dangerous about this argument, in our humble view. It amounts to a kind of justification of "pre-crime." Making an argument against what one considers to be excessive taxation ought not to bring the wrath of the government down on one's head, certainly not in a society that values free speech.

The argument being made here seems to be logical fallacy. You can have your free speech, but be prepared to undergo heightened government scrutiny if you aim your comments in the wrong direction.

Surely this was not what the founders had in mind when they wrote the Constitution. In fact, the Constitution does not even include a provision for progressive taxation of the sort demanded by the income tax.

The founders believed everyone ought to be taxed equally as a matter of fairness and the fairest tax was a kind of sales tax. It was only during the Civil War that this changed.

This article seems to get one other thing wrong, as well. It mentions the current state of US disrepair but doesn't explain that the cause is likely a monetary one. Because money is controlled and issued by a monopoly central bank, the kinds of results seen in the US today are perfectly predictable.

One cannot declare a government monopoly of money stuff and expect the economy to operate efficiently. The inevitable result will be vast booms and busts and corrosive centralization of businesses following extensive bankruptcies.

The article doesn't explain operative difficulty facing the US and thus, the conclusion that paying one's "fair share" is necessary to fix the US economy is highly doubtful. The conclusion that criticizing modern taxation and its high rates should justifiably bring one a measure of extraordinary scrutiny seems a kind of logical fallacy.

And the idea that paying ever-higher taxes will fix what is broken about Western societies seems to us to be an equivalent logical fallacy.

After Thoughts

A monetary solution is necessary, not a fiscal one.

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