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Tea party investigation: Is the problem the IRS or the tax code? (+video)

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The president vowed that the White House would work “hand-in-hand” with members of Congress investigating the IRS and that Treasury Secretary Jacob Lew would immediately begin implementing recommendations from an inspector general’s report chronicling the fact that IRS agents gave special scrutiny to tea party groups in 2011 and 2012, actions the president called “inexcusable.”

Attorney General Eric Holder told a congressional panel earlier in the day that the Department of Justice is continuing a criminal investigation of IRS officers involved in the matter.

While Obama had previously hedged his statements on the IRS’s bad behavior in the careful tones of someone waiting for all the facts, the release of the inspector general’s report Tuesday evening gave way to an angrier, more direct approach.

“The misconduct that it uncovered is inexcusable, and Americans are right to be angry about it, and I am angry about it,” he said. “I will not tolerate this behavior in any agency but especially at the IRS, given the power that it has and the reach that it has in all of our lives.”

That angry disposition certainly matches the attitude on Capitol Hill, where House Speaker John Boehner (R) of Ohio said that jail time, not resignations, would be the true measure of accountability.

But the IRS, despite its troubling performance in the matter at hand, is otherwise playing a losing hand.

First is an issue of dollars.

“The tax code has become unmanageably large, and there hasn’t even been an attempt to keep the IRS paced with that,” in regard to funding, says Lloyd Mayer, a professor of law at Notre Dame University in South Bend, Ind.

For that reason, Nina Olsen, the nation’s taxpayer advocate, argued in congressional testimony last week that since her tenure began with the IRS in 2001 she has “never been more concerned” about its ability to advise taxpayers and accurately collect taxes.

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