'A Law Unto Itself: Power, Politics, and the IRS'

This book review was originally published on Wednesday, March 28, 1990, in the New York City Tribune.



RICHARD SINCERE
Fanaticism of IRS Seen as Proof That Absolute Power Corrupts Absolutely


A Law Unto Itself: Power, Politics, and the IRS, by David Burnham, Random House, $22.50, 420 pp.

Investigative reporter David Burnham is worried about cynicism in America. He worries, he told a gathering at the Cato Institute in Washington, because cynicism is destructive and it leads to corruption. Cynicism, he said, is particularly destructive of the Congress, the Internal Revenue Service, and the American taxpayer.

During this tax-paying season, it is obvious that Americans direct an enormous amount of cynicism toward the IRS. Burnham’s complaint is that there is too much cynicism and not enough skepticism. Webster’s defines a “cynic” as “one who believes that human conduct is motivated wholly by self-interest” and a “skeptic” as one who has “an attitude of doubt or a disposition to incredulity either in general or toward a particular object.”

If too many people believe that human activity is fundamentally selfish, few are willing to act selflessly; leading inexorably to corruption. Healthy skepticism, on the other hand, leads to the questioning of corruption and corrupt institutions.

Burnham has found that even among the media, there is not enough skepticism regarding the Internal Revenue Service, which as an investigative bureaucracy is five times bigger than the FBI and twice as large as the CIA. The IRS, Burnham warns, is hugely powerful and its power is hugely corrupting.

The institutions that should be watchdogs of the IRS -— the press, the courts, and the Congress — simply do not do the jobs. No major newspaper, Burnham says, has assigned a reporter to a full-time IRS beat. Ne notes that when the Washington Post asked a reporter to cover one of the rare IRS oversight hearings on Capitol Hill, she decided not to go simply because the IRS commissioner himself was not testifying. If the information does not come from the top, her inaction seemed to say, it is not worth pursuing.

Judging from Burnham’s new book, A Law Unto Itself: Power, Politics, and the IRS, there is a lot worth pursuing. The book is a catalogue of abuses, corruption, attacks on average citizens and prominent politicians, and simple incompetence that seems endemic in a government agency that touches the lives of everyone. The IRS has powers that no other police agency in the country can claim. And hardly anyone is willing to stand up to the IRS.

IRS agents distrust the American people. Burnham writes that one of the fundamental attitudes that motivates IRS agents is this: “Taxpayers suspected of not complying with the tax laws are considered guilty until they, the taxpayers, prove themselves innocent.”

This can be an expensive proposition. One Pennsylvania businessman who was unjustly accused of owing back taxes paid $75,000 in legal fees to prove his innocence; his girlfriend, whose assets were wrongly seized by the IRS during the course of the investigation, paid an additional $30,000. Because of the energy and expense used in proving his case, the businessman told the Senate Finance Committee, “I am now broke, I have no job, no insurance policies, and no car. We did nothing wrong, nothing illegal. We are the victims of an IRS mentality that believes all taxpayers are criminals who should be punished.”

This is no isolated incident. An IRS collections agent in a southwestern state told Burnham “the single word we often use when referring to the public. That word is ‘slime.’”

The IRS has also been used as a political tool. Although the political use of the IRS is most often associated with the Watergate scandal during the Nixon Administration, Burnham argues that every president has used it. Franklin Roosevelt was worse than Nixon, he says, but abuses came about during the Kennedy and Johnson Administration as well.

For instance, the Johnson IRS began a 10-year, time-consuming and expensive investigation into the National Council of Churches because of the ecumenical organization’s “open political involvement in the battles to end racial segregation and the Vietnam War.” During the 1950s, the IRS seized the assets of the Communist Party of the USA, forcing that party — which was and is a perfectly legal political party — to operate on a cash basis. The IRS’s argument was that the Communist Party had not paid taxes in a number of years, even though the Republicans and Democrats had also paid no taxes during the same period of time, and were not required to do so.

Conservative groups have also been targets of IRS attempts to curb unwanted political beliefs. President Kennedy himself ordered investigations of mainstream conservative and far-right groups, including the Christian Anti-Communist Crusade, the Conservative Society of America, and the John Birch Society. Burnham writes: “According to a 1963 report by [IRS Commissioner Mortimer Caplin], the agency recommended revoking the exempt status of H.L. Hunt’s LifeLine Foundation and of Dr. Fred Schwarz’s Christian Anti-Communist Crusade. Similar action was not recommended for the John Birch Society because it did not claim tax exemption. But Caplin informed the White House that the IRS investigations had discovered that some taxpayers contributing to the John Birch Society had improperly claimed business deductions for their subscriptions to American Opinion magazine, the society’s publication.”

Given the IRS’s power, it is easy to understand why politicians would be shy about criticizing the agency. Burnham gives three basic reasons: (1) Congressmen want to send money to their districts, and they worry that if they try to mess with the IRS, they might upset the money machine; (2) Congressmen personally fear the IRS; through public audits and false accusations, the IRS can and does destroy political careers; (3) Burnham calls this “subtle and infuriating.” Every tax reform measure brings in campaign contributions for congressmen and senators — after all, businesses benefit from such reform — but each tax reform increases the power of the IRS, which alone can interpret the new rules without fear of retribution or oversight.

It seems clear that more investigative reporters like David Burnham should be piercing the IRS, looking for corruption and abuse. Any American can be the target of misplaced IRS ire. All Americans should be concerned about this “law unto itself.”

Richard Sincere is a Washington-based issues analyst and writer.