OTHER VOICES
Sen. Orrin Hatch, R-Utah, has it right. “Sending the IRS on a politically motivated witch hunt,” he said Friday, “is simply unacceptable and could have a chilling impact on the constitutionally protected right to free speech.”
Therefore, the IRS must scrupulously avoid any taint of political favoritism as it aggressively pursues investigations of possible tax code abuses by political advocacy groups. It must disregard the groups’ liberal or conservative leanings, and, if it finds abuse, it must come down hard on the violators.
To be fair, that’s not exactly what Hatch had in mind. The senior Republican on the Senate Finance Committee was trying to discourage the IRS from conducting such investigations, which he suspected were an attempt by Democrats to get the agency to impede fundraising and electoral spending activities by groups with conservative agendas.
Even so, the investigations should proceed — and with some urgency — as a tsunami of campaign cash threatens to drown this year’s elections, much of it flowing from corporations, labor organizations and business associations that take pains to hide their identities and their self-interests.
This newspaper decries the obscene amounts of money that now drive and distort the American political process. The U.S. Supreme Court aggravated the problem with its 2010 Citizens United decision, abolishing limits on how much corporations, business groups and organized labor can contribute to political campaigns. Congress could require disclosure, the court reasoned, and public knowledge of who and what gave how much to whom would reduce the risk of corruption.
But ingenious political operatives quickly discovered a way around disclosure: Certain kinds of IRS-authorized non-profit groups are entitled to keep their donors’ names secret. So some political advocacy committees started spinning off so-called 501(c)4 “social welfare” groups and funneling contributions through them.
But IRS rules say that if a social welfare organization becomes primarily engaged in political activity, it no longer qualifies as a 501c group. Given the millions of dollars some of these groups are spending on political advocacy, the IRS has an obligation to see if they still are entitled to their status and the privileges that come with it.
The IRS also needs to find out if the groups’ corporate and special-interest donors are treating these political contributions as tax-deductible business expenses.
Hatch’s concerns about possible political motives might stem from the fact that Republican and right-tilting advocacy groups outnumber Democratic and left-tilting ones by two to one.
There are super PACs, 527s and 501(c)4s. Of the 138 such groups charted by the non-partisan Center for Responsive Politics as of Monday, 81 are conservative and 42 are liberal with the balance independent or not affiliated.
Thirty-seven of the 138 are 501(c)4 groups, 23 of them conservative and 14 liberal. And while some of these groups voluntarily disclose the names of donors, many do not. Hiding donor information neither inspires confidence nor, as the Supreme Court naively hoped, thwarts corruption.
The predominance of conservative groups is not the IRS’ fault, and it’s not the IRS’ problem. The agency’s job is to see if these groups are acting as they should, and it needs to get to it without delay — without fear of or favor to any party.