The Intimidation Game

by Kimberley Strassel

  In the Senate, Max Baucus wasn’t the only Democrat who had written to demand that the IRS take action against (c)(4) groups, but who now claimed to be outraged that it had done so. There was Oregon’s Jeff Merkley, who insisted that “what the IRS did was wrong” and that those “responsible” must be “punished.” There was New Hampshire’s Jeanne Shaheen, who claimed that the IRS actions were “completely unacceptable.” And there was New York’s Chuck Schumer, who maintained that “heads should roll at the agency.”

  Democrats in red and purple states, many of them up for reelection in eighteen months, nearly climbed over each other to produce appropriate levels of outrage. North Carolina’s Kay Hagan couldn’t believe how “disturbing and troubling” was the news. Arkansas’s Mark Pryor took to Twitter, promising he’d “get to the bottom of this so we can fire those responsible & ensure this never happens again.”

  And the administration at least put on the appearance of a swift response. Four days after the Lerner event, the Justice Department unveiled a criminal investigation. Five days after the event, the IRS announced that Miller was on his way out as acting commissioner. Six days after the event, Obama appointed Office of Management and Budget controller Danny Werfel to lead the IRS, promising he’d “restore confidence and trust.” Thirteen days after the event, Lerner was placed on administrative leave, having refused to testify before Congress or retire.

  And yet it was all a sham.

  Democrats created the environment that pressured the IRS to act. The Justice Department investigation never went far. Werfel delayed the congressional probe, and instituted policies designed to further hamper nonprofit activity. Lerner was never fired, prosecuted, or even reprimanded.

  Instead, from the moment the scandal broke, the IRS and White House were spinning a yarn—setting a false narrative and minimizing the misdeeds. That yarn started only seven days after the Lerner admission, when Democratic operatives began to spread the story that the IRS had identified two “rogue” Cincinnati employees as the source of the entire problem. The entire Democratic establishment continued to weave what the National Review’s Rich Lowry would come to term the “Cincinnati Lie.”

  Just one week after Lerner’s confession, Washington Democratic representative Jim McDermott used his opening statement at a Ways and Means hearing to declare, “There is a difference between stupid mistakes and malicious mistakes,” and all that had happened at the IRS was that a “small group of people in the Cincinnati office screwed up.” Press Secretary Jay Carney ten days after the scandal broke marked it all down to “line employees at the IRS who improperly targeted conservative groups.” James Carville, the go-to Democratic defender on cable TV, wrote the affair off as just “some people in the Cincinnati office.” Of course, even this Democratic telling of the scandal should have caused alarm. The idea that some “rogue” agents in Cincinnati could silence the speech of tens of thousands of Americans—and nobody noticed—is a damning criticism in and of itself.

  This early slant would nonetheless prove remarkably effective. Millions of Americans would come to believe the following: that the United States has confusing tax-exempt laws (not true); that a flood of social-welfare and charitable applications overwhelmed that system (not true); that “low-level” and “rogue” agents had stepped out of bounds (not true); and that even liberal groups had been swept up in the harassment (definitely not true). It would take Jordan and other congressional investigators close to two years to unravel what had really happened. By then, not a lot of Americans were paying attention anymore.

  * * *

  Ask Jordan how much time he’s spent on the IRS investigation and he laughs out loud—a lot of time. House Oversight chairman Darrell Issa officially walked point on the IRS investigation, but much of the real work came from Jordan, who chaired the Subcommittee on Government Operations. He wasn’t the only one digging deep into the IRS mess. Michigan representative Dave Camp’s Ways and Means Committee did yeoman’s work, as did Utah senator Orrin Hatch. (Oregon senator Ron Wyden, who worked with Hatch on the Senate report, was one of the few Democrats who showed an interest in finding the truth.) But Jordan felt a personal connection to this outrage and personally spearheaded the probe.

  That’s unusual for a congressman, as even his staff will admit. Jordan is gracious, and continuously gives credit to a dutiful team that diligently pieced together the IRS intimidation game. It ultimately reviewed more than 1.3 million pages of documents from the IRS, Treasury, Justice, the FEC, the IRS Oversight Board, and TIGTA. It sat through close to fifty-five interviews and did the legwork for endless public hearings. “These guys worked their tails off,” says Jordan, noting that a lot of what he’d learn came from telephone briefings with this team.

  But his staff in turn love to point out that Jordan was intimately involved—absorbing the information, running down questions, even personally sitting in on interviews to grill witnesses. “These are daylong affairs,” says one of Jordan’s aides. “And he’d be there the whole day, asking questions, picking up inconsistencies, going back on points. It’s really rare to have a congressman do that. He ran this thing.”

  Jordan’s memory burned with the meeting his staff had conducted with Lerner just following the February mailout of the IRS letters. “We had a copy of the questions the IRS had sent, and we asked her, ‘Is this standard operating procedure?’” he recalls. “She lied to these guys. She said, ‘This is the normal back-and-forth.’”

  Prior to Lerner’s announcement, the IRS had been just one thing on Jordan’s to-do list; after, it became Jordan’s morning, noon, and night focus. His team started from the bottom up. “We began by interviewing the guy who collects the paper in Cincinnati and opens the mail—and we went all the way up to the commissioner. And then on to people at Justice and the Federal Election Commission,” remembers Jordan. He would sit at a desk in the middle of his staff office, one or another member of his group blaring on speakerphone, as the team gamed out areas of inquiry, sorted through inconsistencies, and worked out questions for interviews or hearings.

  Jordan’s team managed to get in a few weeks of productive work before the barriers started going up.

  * * *

  It took Democrats less than a month to drop all their feigned outrage over the IRS scandal and to move swiftly to accusing Republicans of playing political games. As the days ticked on, the fear they felt over getting blamed for the targeting scandal paled by comparison to that they felt about losing the Senate in the 2014 midterms—or the presidency. They remained as intent as ever on shutting up conservative groups.

  Two short weeks after Lerner’s admission, senior Senate Democrat Dick Durbin found himself on Fox News Sunday being grilled by host Chris Wallace over the letter he’d sent the prior October to the IRS demanding an investigation of conservative groups. Durbin was unapologetic, and suggested that groups deserved the scrutiny. He complained that conservatives like “Karl Rove” at Crossroads were “boasting” about “how much money they were going to raise and beat Democrats.” Durbin couldn’t help admitting what he had been trying to accomplish—a culture of fear: “I knew that if they went to investigate this group, every other group would be put on notice.”

  Then there was Elijah Cummings, Darrell Issa’s Democratic counterpart, the ranking member on the Oversight Committee. Cummings at the first hearing in May expressed his concern over the scandal and his hope for a “bipartisan and thorough investigation.” “Thorough” in Cummings’s mind was the space of one month. That’s how long it took before he went on national television, in an interview with CNN’s Candy Crowley, to declare the case “solved” (it was Cincinnati’s fault) and to claim that “if it were me, I would wrap this case up and move on.” At the time of that interview, Congress had interviewed all of five IRS employees.

  When Republicans didn’t take his advice, Cummings attempted to sabotage the probe. He at one point released a full transcript of one IRS employee interview, giving futur
e witnesses a guide as to what they’d be asked in their own examinations, and allowing them to coordinate testimony. One IRS employee would later admit that prior to his own meeting with Congress, he’d been told by a supervisor to review the transcript Cummings had released.

  Then again, Cummings had good reason to make this go away. The investigation would later find that his staff had been in contact with the IRS throughout the targeting scandal, going so far as to leak it information about upcoming congressional actions. In March 2012, soon after Congress started taking an interest in the IRS’s actions, one IRS employee wrote to his superiors, “I got some intelligence from a senior Democratic staff member on House Oversight and Government Reform.…[A] hearing in May or June on 501 c 4s may be in the works.”

  * * *

  The biggest “tell” of Democrats’ role in the IRS scandal may in fact be their involvement in the elaborate cover-up that followed. The left realized that Republicans very early on were beginning to blow holes in the Cincinnati lie, and Democrats wanted desperately to shut down the discussion.

  Mitchell was one of the first to expose the Cincinnati scam, when she supplied to a reporter the letter she’d penned to the IRS back in October 2011—the one in which she’d asked the Cincinnati agent to forward the correspondence to the “task force” in Washington he’d mentioned. Mitchell’s information ended up on the front page of the Washington Post five days after Lerner’s Cincinnati lie.

  A favorite Democratic way of undermining the probe was to claim that Republicans who wanted answers were engaged in partisan politics. Starting about the time of his Crowley interview, Cummings rarely referred to the IRS investigation without including the words “witch hunt.” Liberal groups and media outlets picked up the cry, arguing that the GOP was belaboring the probe (now a whole month old) in order to gain political advantage in the next election.

  The White House also took up the line, if more subtly and slowly. Obama got the ball rolling at the end of July. At an economic address at Knox College in Illinois, he accused the GOP of engaging in an “endless parade of distractions, political posturing, and phony scandals.” Obama didn’t specify what scandal he meant, but it was a clear reference to the tax agency uproar. Fox’s Chris Wallace clarified it a few days later, asking Treasury Secretary Jack Lew if he thought the IRS targeting was just a “phony scandal.” Lew’s response: “There’s no evidence of any political decision maker who was involved in any of those decisions. And I think the attempt to try to keep finding that evidence is creating the kind of sense of a phony scandal that was being referred to there.” So, yes, the president was saying—two months after the news broke—that the whole IRS thing was just a “phony scandal.”

  December came, and Obama decided enough time had passed to mark the entire affair down to a government bumble. “If…you’ve got an office in Cincinnati, in the IRS office that—I think, for bureaucratic reasons—is trying to streamline what is a difficult law to interpret about whether a nonprofit is actually a political organization, deserves a tax-exempt agency. And they’ve got a list, and suddenly everybody’s outraged,” he told MSNBC host Chris Matthews. Obama’s own initial outrage was clearly gone. He’d moved on to trying to reset the entire debate. His interview words suggested it was the IRS’s job to weed politics out of nonprofits—which simply isn’t true. And he suggested that the problem was a confusing law. In fact nothing had changed about the law in 2010; the provision governing nonprofits had been easily and fairly enforced for fifty years. The only thing that had changed was a new administration, with a new view of the role of the IRS.

  Obama would in later years go much further, telling Fox’s Bill O’Reilly that there was “not even a smidgeon of corruption” in the events at the IRS. Rather, said the president, the only problems were some “bone-headed decisions.”

  The entire White House mobilized against the congressional probes. White House counsel Kathryn Ruemmler in November 2013 flat-out refused to assist Jordan and Issa in questions they had about the White House’s interaction with the IRS. Specifically, the White House wouldn’t let the committee interview Jennifer O’Connor, who had worked as the top lawyer to the IRS commissioner, and had helped lead the agency’s response to congressional hearings. The committee ultimately had to subpoena O’Connor (who’d been promoted to a deputy White House counsel), and she stonewalled her way through a hearing.

  Obama’s other clever stall strategy: that Justice Department “investigation.” The probe was never real, but it allowed the White House to claim that something was being done, and to later declare that no crime had taken place.

  Jordan grew worried about that probe early on, when FBI director Robert Mueller appeared before Congress. Mueller was flummoxed by even the most straightforward questions about the status of his so-called investigation. He didn’t know how many people had been interviewed. He didn’t know how many agents were working the case. He didn’t know who was the lead investigator. He admitted he hadn’t even been briefed on the status of an investigation into one of the biggest scandals in Washington. “Mueller’s reaction; that set the tone,” says Jordan. “It was pretty clear there’d be no help there.”

  Issa and Jordan would twice in 2013 write to the new FBI director, James Comey, for updates. The law enforcement agency steadfastly refused to give information, steadfastly refused to brief Congress, steadfastly made clear that it had little or no interest in pursuing the subject. Mueller’s confusion notwithstanding, the committee found out that the lead investigator was Barbara Bosserman, an Obama donor and DOJ civil rights attorney.

  Mitchell vividly remembers her own interaction with Justice “investigators” as one of the more “bizarre” conversations of her life. In February 2014, Mitchell testified in front of Congress, blasting the Justice Department probe as a “sham” and a “nonexistent investigation.” Her proof was that eight months into the probe not one of her clients had been interviewed. Not a single one of Sekulow’s had been interviewed either. South Carolina’s Trey Gowdy, a former federal prosecutor who knows something about conducting investigations, asked at the hearing how it was that the president could declare that there had been not a smidgeon of corruption when the FBI had yet to even interview anyone targeted.

  Just a few days later, Mitchell got a call from an FBI agent inviting her and Engelbrecht in for an interview. “I remember saying, ‘Gee, it’s been a while. I’ve been wondering where you are. You are probably aware that I was recently a bit critical that it had taken you so long to consider my clients.’ And he admitted, ‘Yes we are aware,’” says Mitchell. The attorney decided to attend that first meeting on her own. Bosserman was present, and Mitchell remembers that she said almost nothing the entire time Mitchell spoke. Only when Mitchell started talking about the national conference calls conservative groups had arranged right after the first letters hit did Bosserman pipe up. “She suddenly looks up and says, ‘Were there any progressive groups on that call?’ And I said, ‘Why on earth would there have been any progressive groups on that call? Nothing happened to progressive groups!’ What the hell kind of question is that?”

  By early 2014, the administration had already leaked to the Wall Street Journal that the FBI planned no prosecutions in the probe. To this day, Congress has never received information about the administration’s “investigation” into the IRS scandal. Jordan believes this to be as big a threat to the freedom of the country as the targeting itself. “When you have a Justice Department more focused on politics than justice, the country is in trouble. And there is no denying that is where we are.”

  * * *

  Nobody knew nothing. The IRS was a stone wall from the moment Congress started its inquiry.

  Doug Shulman, who’d been commissioner until the end of 2012, declared after the scandal broke that he didn’t “accept responsibility.” He’d known about the backlog, known the IRS had asked for donor information, and yet had never informed Congress.

  Jonathan Davis, ch
ief of staff to Shulman, would tell investigators that he didn’t really have “a background in tax law” and so it just wasn’t “something I was involved with.” At one point in the questioning, Davis was asked if there was anything he might have done to prevent this issue from happening. He responded, “I would leave that to the people who know a lot more about this than I do.” To which the congressional questioner responded, “Sir, you were the chief of staff to the Commissioner of the IRS.”

  Steven Miller, deputy commissioner throughout much of the targeting, and the man who replaced Shulman, at one point considered whether he should use an upcoming hearing in 2012 to tell Congress what was going on. He decided against it. He sat on the information for another year, and then helped craft the strategy for Lerner’s apology. Yet he too now claimed he didn’t really understand that this was “targeting.”

  Nikole Flax, Miller’s chief of staff, used the TIGTA investigation as her own excuse for why she felt her boss shouldn’t tell Congress anything.

  Then there is the elusive William Wilkins, a man who has always deserved far more attention in this scandal. The IRS—to keep up the façade that it is a “neutral” agency—has only two political appointees. One is the commissioner, the other the chief counsel. Wilkins was appointed by Obama in 2009. He’d been a counsel for the Democratic Senate Finance Committee, and then a registered lobbyist at a left-leaning law firm, WilmerHale, from which he donated to Democratic candidates. He also had another close tie to Obama: He’d led the defense team for Reverend Jeremiah Wright’s Trinity United Church of Christ in Chicago when it was under investigation by (as it happens) the IRS.