Issa committee is still wasting time and taxpayer money on the IRS non-scandal

Darrell Issa

Still wasting time and taxpayers money on the IRS non-scandal, Darrel Issa is attempting to redefine the fifth amendment for one last chance to find something to pin on someone.

On June 28th, the House Committee on Oversight and Government Reform met to hold a markup session of a resolution that Lois Lerner waived her Fifth Amendment privilege against self-incrimination when she made a voluntary opening statement at the May 22, 2013 full Committee hearing entitled "The IRS: Targeting Americans for Their Political Beliefs"

Just as an aside, doesn't the committee hearing's name give you the idea that Issa and his gang of numb-skulls have a pre-formed prejudicial view of the IRS that they are trying to impose on the rest of America?  I can't say that they are jumping to conclusions, but Republicans really have a knack for making our government appear to be the enemy.

Be it resolved then, that the Committee on Oversight and Government Reform have hereby found new interpretations to the intent of the Fifth Amendment.  I guess they read between the lines of the text of the amendment.

Let's see if you can find the same interpretation by reading the actual text of the amendment that follows.

"No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation."

There are many rights stated in the amendment.  Did you find the hidden meaning that the Committee found?  If you did, then "taking the fifth" may mean something entirely different to you and may have more to do with imbibing a certain size of alcoholic spirits than constitutional law.

There is nothing in the amendment that indicates a person forfeits their fifth amendment right protecting them from being compelled to be a witness against themselves if they say anything in defense of themselves first.  

The simple truth is that Issa, frustrated that this attempt at a Republican generated conspiracy theory did not lead directly to the President's door, is trying to find some way of making his Committee's efforts appear something more than a waste of time.  

But they have been nothing more. 

The real scandal isn't at the IRS

The IRS is tasked with the responsibility to review applications for tax exemption.  In what is known as the 501(c) process, organizations can apply for tax exemption by providing information which proves to the satisfaction of the IRS, that they are non-political, social welfare type organizations whose primary function is not to advance a political agenda.

The IRS has recently come under attack by Republicans in Congress who claim that the IRS over-stepped their authority when it came to reviewing tax exemption applications from Tea Party type organizations.  The outrage of Republicans is evident  in the chambers of Congress where Republicans led by Darrel Issa, chair of the special investigative committee, have sworn to get to the bottom of the connection of IRS wrong-doing with the White House and more importantly with President Obama.

Perhaps because Republicans are blinded by the rush that getting a chance to implicate the President of wrong-doing elicits, they are missing some of the important facts which could, and by all rights should, turn the tide of wrong-doing onto their constituents.

First, to even refer to an organization as a Republican group implicates them as being political.  This violates the meaning of a 501(c)3 and 501(c)4 and should not entitle them to tax exemption.  Even so, the IRS approved applications for many obviously Republican political groups such as the "Tea Party Patriots" the "American Patriots Against Government Excess", "National Tea Party Group" and "Tea Party Radio."  If you have any doubt that these organizations are primarily politically focused, all you have to do is go to their web sites to see it for yourself.

So why did the IRS approve these applications?  If they followed their own guidelines, they should have known that these organizations were primarily involved in politics.  So what did they base their  decisions on?  Despite what the right wing media and Republicans in Congress are attempting to convey, the IRS did not make their decisions based on the names representing these organizations.  They could not have, otherwise they would not have approved the applications.  They made their decisions based on the information that the organizations provided.  

It appears a safe bet that the information provided to the IRS by the applicants was insufficient to implicate the organizations as political action committees.  If this was done by the applicants to  intentionally mislead the IRS review, then it is a crime which is punishable by fines and/or imprisonment.  That is the real scandal here.  These organizations might have knowingly hidden information from the IRS in order to get unfair and undeserved tax advantages.  That sounds familiar.  Where have we seen this before?  Oh yeah, Romney was pretty good at that.

Lindsey Graham

Now in a relentless pursuit to find something bad to pin on the President, Senator Lindsey Graham (R- SC) is calling for a special prosecutor to investigate the entire IRS "scandal".  This could be the best thing that ever happened for the IRS and the worst thing for the Tea Party Patriots and their Republican leadership.

If a special prosecutor is called who is impartial, then I predict that the IRS and the President will be cleared of any wrong-doing.  Furthermore, some unhappy Tea Party organizations will be paying for their arrogance and deception when the real scandal is revealed.  Perhaps clearer Republican heads will prevail and convince Graham to drop the idea before the truth can be known.

That would be a pity.

A Republican to English dictionary

Although born and raised in the United States, my father, who passed away in his old age a few years ago, was not really good with the English language.  Sometimes he used words that he made up in conversation that sounded like words that they really weren't.  My kids were often confused by their "Papa", as they used to call him, and I would joke with them that maybe we needed to get a Papa- to-English dictionary.

Because of their support for policies which Republicans stand for, most of which go against their best interest, middle-class Republicans may be well served if they had a Republican-to-English dictionary.  Perhaps that way they could better understand that their welfare is not of concern when it comes to modern Republican politics.

Here are a few examples of statements we have heard our Republican leaders talk about.  I have given some assistance to the American voter by attempting to identify the true meaning of these words in plain English.

"Jobs, Jobs Jobs": Cheap foreign labor for America's Corporations.  

"Support for our troops": Increasing government funding of defense contractors.

"Reducing the deficit":  Protecting the 1% by taking revenue off the table, increasing military budgets to protect defense contractors and only calling for government spending reductions in programs for the poor, women, children, the elderly, students, the handicapped, military veterans and the unemployed.

"Smaller Government": 1. Eliminating government protections of it citizens in regards to regulations on business so that big business can operate with a free hand to decrease costs involved with making a safe product, protecting the environment, giving fair wages, creating a safe work environment, treating workers fairly and otherwise operating responsibly.  2. Reducing government spending by eliminating public service jobs such as teachers, police, fire-fighters and government workers and rejecting the American Jobs Act that would have improved the infrastructure of roads, bridges, schools, etc. 

"2nd Amendment rights": Returning the favor for NRA lobbyist money and preserving the market and demand for weapon manufacturers regardless of the wishes of the majority of Americans for stronger gun laws.

"Obama-Care": Originally a Republican introduced derogatory term for the Affordable Care Act which later became adopted as a catch-phrase by President Obama.  Republican intent is to put fear into American citizens and protect big insurance corporations from the effects of treating American citizens with fairer insurance rules and charging costs that would benefit the citizen.  Most of the effort of the Republicans in the 113th Congress has been in attempting to repeal Obama-Care law 37 times as of this date.

"Sequester": A Republican plan since 2010 to reduce the size of government in a way that would protect the wealthy and would otherwise never be possible by normal legislative proceedings.

"Filibuster": The cornerstone of Republican obstructionism used to prevent problem resolution, slow down progress on legislation and block President Obama's appointees and ideas that support middle-class Americans.

"Balanced Budget": A financial plan that reduces spending on useful government programs such as medicare, medicaid, the social safety net and social security which must not be balanced by any increase in revenue, especially by increased taxes on the wealthy or corporations. 

"501(c)4": Republican worked loophole in the IRS regulations that permits a political action committee to receive donations that are exempt from federal taxes and then to complain when the IRS workers request information that may prove they are political action committees.  The 501(c)4 is supposed to be for non-political social organizations.

"Stimulus package": Another name for the American Recovery and Reinvestment Act.  An act carried out by the Democrats and President Obama that saved the country from financial collapse.  Republicans voted against the stimulus package.

"Voter ID": An attempt to reduce access to voting by members of the citizenry who would not vote Republican in elections.  This action as well as closing down voting precincts and voting hours were used by Republican state legislatures as a strategy in the 2012 elections.

Republicans have proven that they do not represent the middle-class or the poor.  If you are in one of these groups and you vote Republican, I would be interested in knowing why you would vote that way.

If you have any other definitions, please feel free to add a comment.  I'll add the best one's to my collection.

TIGTA says no evidence leads to White House participation in IRS 501(c) scandal

TIGTA

So full of joy were Republicans when another so-called scandal looked like it could involve the upper levels of the Obama administration.  I'll call it the IRS501(c) scandal, even though calling it a scandal is a real stretch.  

Fox news contributors seriously reported that this IRS manipulation was being controlled by the White House so that Republicans would lose Ohio.  This had to be the case they believed, otherwise Obama would have lost the 2012 Presidential election.  People say ignorance is bliss but spreading that kind of misinformation is unforgivable. 

The Treasury Inspector General for Tax Administration (TIGTA) was notified by certain Republican members of Congress that they suspected wrongdoing at the IRS.  The TIGTA did an audit investigation of the situation at the IRS and published their findings.  They found no evidence that the White House was involved in any way.     

The incident took place during a time when Douglas H. Shulman was IRS Commissioner.  Mr. Shulman was a Republican and a George W. Bush appointee to the office.   Does anyone seriously think (other than Fox news and the radical right wing media) that President Obama could manipulate a Republican to target other Republicans for political gain?  Of course not.

George W. Bush

And what happened at the IRS exactly?  The IRS saw a dramatic increase in the number of applications by groups and individuals for 501(c)3 and 501(c)4 tax exempt status for their organization.  Per tax regulations 501(c)3 exempt organizations cannot have political ties at all and must receive IRS approval.  The 501(c)4 organizations may only have limited and not primary focus on political issues.  It is the job of the IRS to investigate these applications to ensure that they meet the requirements.

The IRS receives nearly 70,000 tax exemption requests each year.  All of the applications for tax exemption are sent to the IRS office in Cincinnati, Ohio where less than 200 employees must review each one.  In order to facilitate this daunting task, some of the workers there used character searches to find those exemptions that may be 501(c)3 or 501(c)4 types.  Since the workers noticed a lot of the applications had words such as "Tea Party" and "Patriot" which implied to them that they may be 501(c) exemption requests , they used such words to help them filter out the applications.  

IRS indicates that these were not the only search terms used and that there was no political bias intended in any of their searches.   In fact only 70 of the 296 cases reviewed contained the words "Tea Party".   However, IRS management realizes that this method is "inappropriate"  and vows to change the process.   They note that even if the search process was not used, information in the application would still have targeted these same groups for follow-up (or as IRS calls it "centralization".)   There are currently 470 cases that are centralized.

The TIGTA found that the IRS used inappropriate criteria that identified for review Tea Party and other organizations applying for tax‑exempt status based upon their names or policy positions instead of indications of potential political campaign intervention.

They identified that ineffective IRS management:
1) allowed inappropriate criteria to be developed and stay in place for more than 18 months,
2) resulted in substantial delays in processing certain applications, and
3) allowed unnecessary information requests to be issued.

Although the processing of some applications with potential significant political campaign intervention was started soon after receipt, no work was completed on the majority of these applications for 13 months. This was due to delays in receiving assistance from the Exempt Organizations function Headquarters office.

For the 296 total political campaign intervention applications TIGTA reviewed as of December 17, 2012, 108 had been approved, 28 were withdrawn by the applicants, none had been denied, and 160 were open from 206 to 1,138 calendar days (some for more than three years and crossing two election cycles).

More than 20 months after the initial case was identified, processing the cases began in earnest. Many organizations received requests for additional information from the IRS that included unnecessary, burdensome questions (e.g., lists of past and future donors). The IRS later informed some organizations that they did not need to provide previously requested information. IRS officials stated that any donor information received in response to a request from its Determinations Unit was later destroyed.

Ultimately, this so-called scandal is really a few IRS employees innocently trying to expedite their work assignments by a process which coincidentally gives the perception of political bias to people so biased in their own beliefs and so quick to judgement that they were inclined to blow this out of proportion, especially in their attempts to link it to President Obama.

Barack Obama is the President of the United States.  It's time Republicans started treating him that way.

President Obama

Why the Republican Party is destined to become extinct

Extinct Dodo Bird

As certain as the extinction of the Dodo bird, so is the imminent extinction of the Republican Party.

"What!??" you say.  The Republican party has survived the test of time and is a powerful machine that can't be stopped.  How can the party be destined for extinction?

Glad you asked.

The decline of the Republican party popularity is obvious in the polls and related to their obstruction in Congress for the most part.

Although the radical right wing of the Republican party, called the "Tea Party" deserves much of the blame for the party's loss of popularity, the acceptance of that faction by the moderate Republican membership is being seen by outside observers as the new direction of the Republican party as a whole.

In many respects this is probably a correct perception since the Tea Party Caucus still exists and some members of Congress who have been members of the Tea Party Caucus hold powerful positions on some committees.  I don't think the majority of voters know who in the Republican party is a Tea Partier, yet a large number of Tea Partiers lost seats in the last election.   From the stand-point of the American voting public, the Tea Party and hence the Republican Party may be losing support.

A lot of the personality of the Republican party is still coming from Tea Party members.  The party is inflexible.  It is obstinate and over-reaching.  It does not keep promises.  It is deceitful.  It is bigoted.  It is self-serving.  It is anti-intellectual.  It is uncaring.  It is war-mongering.  It is misogynistic.

The party refuses to accept or pass most Democrat introduced legislation.  They have become famous for being the party of obstruction.  Their overall approval rating in most polls is devastatingly low and around 20% as of this writing.

If you are a politician and the people don't support you, then you should be worried about losing your job.  The fact that most are not worried and continue to act the same way could show how anti-intellectual they are, but because the Republican side of the House has gerrymandered state voting districts, they are fairly sure that their actions represent the majority of people in their districts and they will be re-elected.

The party is populated with leaders who constantly re-invent the wheel and make it a lot less round each time.  Republican political leaders have re-written the workings of the female reproductive system.  They refuse to accept any scientific findings about climate change.  They believe science manipulates data to derive their own self-serving facts.  Needless to say, an overwhelming number of scientists do not belong to the Republican Party.

Republican leaders like John Boehner have said the number one issue for Republicans is "jobs, jobs, jobs."  Yet republicans have done nothing to create jobs.  They stick to the claim that Corporate America would create jobs if we don't tax them, even though Corporate America has given away millions of jobs to third world nations and incoming third world nationals over the last thirty years.  This is deceitful and just another way that Republican leaders show that they do not really mean what they say.

Republican leaders have recently publicly announced bigoted remarks such as calling gays "filthy homosexuals" and calling immigrants "wetbacks."  The White Student Union recently attended the Conservative Action Council where it's leader supported segregation and slavery.

KKK emblem

Without even thinking about the number of Republicans in the KKK, Republican bigotry is becoming more obvious since President Obama has been elected.

The Republicans in Congress appear to hate the fact that a black man could be the President.  They met even before President Obama's inauguration in 2008 to agree to block all legislation he introduced to make him a "one term President."  Failing that, they have continued their obstructionist actions to deny the President any successes.  They are now attacking the Affordable Care Act by voting for a 37th time to repeal it and in the process wasting $55 million of taxpayer money that could have otherwise gone to other more fruitful uses.

Their obsession with causing harm to President Obama includes casting rumors and suspicions of his personal involvement with recent controversies concerning the Benghazi attacks, the IRS review of 501(c)4 tax exempt organizations and Department of Justice obtaining AP members telephone records.

The uncaring attitude of Republican leaders is aptly represented by the introduction of the Ryan Budget which slashes social programs in favor of tax advantages for the wealthy.  Mothers and children who have little to eat rank far below the Republicans favorite person, the wealthy Corporate CEO.  In order to save America with so-called jobs, Republicans will ensure that their favorite persons increase their wealth while much of America starves.  Meanwhile Corporate coffers have become overflowing with cash while jobs are nearly non-existent.

The Bush administration brought us the Iraq and Afghanistan wars.  Had Mitt Romney won the 2012 Presidential election, Iran may already have been invaded.  We saw the clamoring in Congress when it was suggested that Iran might already have or very soon acquire nuclear weapons.  Republicans see war as a means to benefit their wealthy supporters who happen to own and operate companies involved in the weapons of war.  This explains their anxious dialog about going to war and funding war, while their legislation prevents the American victims of war and the veterans of war from getting assistance in returning to civilian life.

Republican leaders, where they control state legislatures and governorships have shown their misogynist side.  Republicans in Congress have stood against the Violence against Women Act.  Other Congressional actions to obstruct or defeat certain social programs will have an impact on women and children.  Wisconsin has passed repeal of equal pay for women.  North Dakota's Governor and other state governors have signed bills which many consider unconstitutional, to reduce women's access to reproductive rights services.  Even though Roe v Wade is law, Republicans in Congress and in the States have managed to restrict the intention of the law.    

Many Republican policies can be explained by what they are against.  They are anti-middle-class in their favoritism to the wealthy at the expense of the middle class.

They are anti-women in their fights against women's rights.

They are anti-gay rights in their opposition to marriage equality legislation.

They are anti-student in their votes against funding Pell grants.

They are anti-urban voter in their fight to make voting more difficult with reducing voting hours and requiring voter ID cards.

They are anti-student voter in their legislation to prevent students from voting in the state where their college is located.

They are anti-labor by their fights against the national labor relations board membership.

They are anti-jobs by their activities to block President Obama's American Jobs Act.

They are anti-consumer by their blocking the Presidential appointment of a Director for the Consumer Financial Protection Bureau.

They are anti-Christian by insisting that social programs for the weakest of society be cut in favor of tax breaks for the wealthy.

They are anti-elderly by their demands for changing Medicare and Social Security which will hurt the elderly.

They are anti-poor people for fighting to repeal the Affordable Care Act which covers millions of formerly uninsured persons and improves patient treatment by insurance companies.

They are anti-veteran by preventing government aid to injured veterans and blocking assistance in finding jobs after serving their country.

They are anti-immigrant by failing to pass immigration reform.

They are anti-family by failing to protect children and families from gun violence by their actions to prevent improved background checks for firearms.

My guess is that the total number of people who Republicans are failing to represent amounts to nearly 98% of the country.  The reason they have not been voted out of office yet, I blame on the "one-issue" Republicans who continue to vote them in.  One-issue Republicans are those voters who dispel any other adverse effects of having a Republican represent them provided they cover their one major (usually social) issue of concern.

Remember Romney

The specific social issue may vary from voter to voter.   Republicans have done a good job in recognizing and appealing to those issues.  These issues include but are not limited to such things as gun rights, right to life, small government lie, no new taxes lie, the moochers syndrome and the job creators lie.

Convincing the voter that Republican policy will benefit them is greatly assisted by the Republican knack for lying to the public guiltlessly about anything that advances the Republican cause.  Fox news and other radical right wing talk show hosts contribute to this and may actually be hurting the Republican party more than it knows.  Lest you forget, remember the lies of the Romney campaign?  The same political infrastructure that led Romney is still leading the Republicans in Congress.  Romney lost the election but we are still being inundated by his policies...because they are Republican policies.

Ultimately, once the majority of one-issue Republican voters start to realize that it is in their best interest to evaluate all of the issues, the extinction of the Republican party will begin.  I think this process has already started and expect that we will see some of the results of this in the 2014 Congressional elections.

I'll bet you $10,000.  (Not really.  That's how I remember Romney ;-)

How to shelter $100,000,000 in an IRA

Recent controversy over Mitt Romney's tax returns has included questions over his IRA (individual retirement account) which is reported to contain well over $100,000,000.

For those of you who do not have an IRA, it is important to note that regulations impose a $5000 limit to the annual contribution that an individual can make to it and even less than this was allowed in the years before 2012.

If Mitt Romney worked at Bain Capital for 25 years, then at the current allowable deposit amount and excluding interest, Mitt's principal would grow to $125,000 in that time.  Yet Romney has nearly 1000 times that amount in his IRA.  So let's say that the investments made by the IRA gave Romney a 15% return each year.  After twenty-five years that IRA should contain about $1,600,000.  Still a far cry from $100,000,000.

So how could Romney's IRA contain so much more?  Allow me to speculate.

When Romney founded Bain Capital, it was created as a Private Corporation.  Legally, Private Corporations do not have the financial transparency that Public Corporations have.  The stock of the Private Corporation is not sold to the public and usually remains under the ownership of the partners of the Investment firm.

The United States Treasury Office began to see a phenomenon occurring with Private Corporations around year 2000.  In increasing numbers, Private Corporations began to find tax shelters to protect their profits from United States taxes.  Additionally, certain stock based compensation plans did not comply with what IRS called "deferred compensation" tax rules.  For example, certain individuals were given stock options with an exercise price that was less than the fair market value of the company's common stock.  To block this practice after year 2000, regulations were adopted to add an additional 20% tax on these transactions.  The idea was to discourage evading taxes by writing regulations that made it less profitable to do so.

In certain companies (Bain may be one of them), under-priced stocks were given to the owners and directly deposited into their IRA accounts.  So let's say the $5000 limit on the IRA deposit was achieved by under-pricing these stocks by a huge amount.  For example, let's speculate that the per share fair market value of the stock was $50.00 but the owners got shares deposited into their accounts at $0.10.  In that case, the number of shares at the fair market value is 100, but at the reduced price is 50,000.  For reporting to the IRS, the Individual Retirement Account meets the regulations and only $5000 is reported as being deposited.  Yet in reality, the true value of the number of shares is 50,000 shares x $50.00 per share = $2,500,000.  

Repeat this year after year and you will soon have $100,000,000.  Even if you do not reduce the price of the stock as much as in my example, you will still be there in no time.

If the individual has a Roth IRA, then the situation is even more favorable.  With a Roth IRA, the taxes are paid on the deposit amount and are not taxed upon withdrawal at retirement.  So in our example above, the Roth IRA owner would pay taxes on $5000 up front and not on the $2,500,000 withdrawn during retirement.

So if you want to shelter $100,000,000 in an IRA, open a Private Corporation, setup a Roth IRA and give yourself stock options at a seriously reduced price.  Pay taxes on $5000 and enjoy the tax-free high life at retirement.