Koskinen would meanwhile insist, in sworn testimony, that the IRS had exhausted every means of tracking down Lerner’s documents, but that all backups and copies had been destroyed. Jordan and Congress had by this point gone beyond trusting any words coming out of his mouth, and instantly asked TIGTA to look into the affair. Sure enough, “two weeks after Koskinen says he lost them all and forever, TIGTA gets in a car and in a matter of days tracks down all these tapes the IRS claims it no longer had,” recounts Jordan. (The discovery would ultimately prove disappointing, as the tapes contained but a small fraction of what Lerner likely stored on her hard drive.)
Government employees do experience hard drive failures, just like private citizens. And Democrats like to claim that Republicans who bang on about the missing Lerner e-mails are engaged in wild conspiracy theories. And it is also generally the case that government bureaucrats are too incompetent to pull off intricate schemes.
Yet if ever there were a government scandal that rose to conspiracy levels, it’s the IRS epidemic of hard drive crashes. TIGTA would later report that as many as eight custodians involved in the IRS scandal experienced a hard drive crash. Most were close to Lerner or closely involved in the affair. They included Judy Kindell (one of Lerner’s top advisers); Justin Lowe (who briefed Lerner on aspects of the nonprofit cases); Ronald Shoemaker (who oversaw the cases that came to Washington); Nikole Flax (chief of staff to the IRS commissioner); and several determination specialists in Cincinnati. TIGTA would also later interview computer specialists who said that the method by which Lerner’s hard drive had failed was “uncommon.” A technician noted the presence of concentric scoring of the hard drive platters on her drive, which an expert told TIGTA would “most likely” be caused by an “impact” to the hard drive or laptop. (Lerner, in her own interview with TIGTA, “denied hitting or damaging the hard drive intentionally.”)
We also know that the IRS for years was loosey-goosey in its e-mail policy, allowing Lerner to use two private e-mail addresses to conduct work, and making use of an instant-messaging system that was (in direct contravention of federal rules) never archived. Lerner in 2013 would in fact send an e-mail warning her colleagues to be “cautious” about what they put in electronic mail (because of congressional inquiries) and then asked if the agency’s instant-messaging system was searchable. When told it was not, she responded, “Perfect.”
The IRS’s decision to hide the crash from Congress meanwhile resulted in the destruction of Lerner documents. The IRS knew in February 2014 that Lerner’s hard drive had crashed. TIGTA would find out that in March 2014, IRS employees had magnetically erased 422 tapes believed to contain Lerner’s correspondence. The destruction of those tapes is suspicious, given that the IRS’s chief technology officer had the previous year—in response to Congress’s investigation—issued an IRS-wide directive ordering the agency was to retain all backup tapes. No more erasing. The CTO, Terry Milholland, would later tell TIGTA that he was “blown away” to discover those tapes had been erased, and that he believed the destruction “more significant than the loss of Lerner’s hard drive.” The bigger point is that had Koskinen’s office properly alerted Washington to Lerner’s hard drive crash when it first discovered the fact—a month before the erasure—those tapes might have been saved.
Congress still has yet to see a fraction of Lerner’s e-mail—and it may never. Koskinen spent his early months at the IRS worried about internal “morale” and telling Congress it needed to give his agency more funding. His appearances in front of Congress all follow the same arc: Dodge questions, jab at investigators, excuse his agency for its misdeeds. He at one point declared that the IRS hadn’t even engaged in “targeting.” By July 2014—just six months on the job—he’d transitioned fully from reformer to partisan, joining Democrats in claiming that the Republicans calling for a special prosecutor were doing so for political reasons. “There are some people who don’t want a straight story,” he sniped, after Republicans called for an independent probe. “I’m not sure if people really want a special prosecutor,” he claimed, since Republicans preferred to hold “all these fun hearings every week or two.”
Fitton notes that the e-mail games continue to today. The IRS at the outset created its own set of search terms for what it believed was responsive to Congress’s request, and put all those e-mails in a separate database. “That database is all they’ve ever looked at in terms of our Freedom of Information requests,” says Fitton. “They refuse to go back to the original IRS system to fulfill our requests. Who knows what they are sitting on?” The watchdog chief says the IRS acknowledged in court that yet other officials “lost” their e-mail, but have refused to say who those individuals were, claiming that “people might criticize the agents in question. And apparently those government agents must be protected, no matter what happened to the Americans who employ them,” says Fitton. Koskinen has so doggedly sat on records that in August 2015 a federal court threatened to hold him personally in contempt if he didn’t comply with document requests.
On the whole, Fitton says, “in terms of gamesmanship and dishonesty, there is nothing comparable.” This comes from a man whose group has sued pretty much every agency in government innumerable times.
Why? “What they were doing was unlawful, they knew it was unlawful, and they don’t want anyone now to know the depth of their lawlessness—at least until enough time has passed to make it irrelevant,” says Fitton. “That’s what the pushback is about. Making time pass. Allowing people to forget their outrage.”
* * *
Yes, Republicans still gripe that we don’t know what happened at the IRS. Yes, they have a bit of a point: Lerner wouldn’t testify; the IRS lost key e-mails; the White House covered things up. But that does a disservice to the investigations, which pieced together some origins of this story, and demolished some lies.
Among the first falsehood to go was the “Cincinnati did it” line. Jordan’s team interviewed those employees. One dismissed the idea of rogue agents as “ridiculous.” Another agreed, “Rogue employees means doing their own acting. I don’t think anybody in our team, including myself, did their own thing out of the command of chain.” Hofacre, the Cincinnati employee so frustrated with the review process that she requested a transfer, told Congress that she believed the public had been purposely misled to focus on Cincinnati.
Jordan also put the lie to the administration’s claim that it hadn’t really known about any of this until TIGTA readied his report. The IRS commissioner and general counsel, remember, are appointed by the president. The IRS is also a branch of the Treasury Department. And the Treasury Department reports directly to the president. All the evidence shows that both the presidential appointees to the IRS and the senior political appointees at Treasury knew about the targeting of conservative groups before the 2012 presidential election, and sat on that information.
Doug Shulman admitted to the Senate Finance Committee that he knew something was wrong in the spring of 2012, during the election—and yet said nothing. He’d later plead that he did not know all the facts until the TIGTA report. But he knew enough to have stopped things, if he’d chosen to.
We know that the highest officials at the Treasury Department were aware something rotten was going on at the IRS in the spring of 2012. Russell George, TIGTA, told Congress that in the spring of 2012 he advised the general counsel for Treasury, Christopher Meade, that he was “conducting an audit of the IRS’s processing of applications for tax-exempt status, and I may have advised him that we were looking at allegations that the IRS was using names such as ‘tea party’ to identify tax-exempt applications for review.” Documents back up TIGTA’s recollection. Meade would nonetheless later claim that TIGTA hadn’t told him much. Similarly, TIGTA told Oversight that he’d briefed the Treasury Department’s chief of staff, Mark Patterson, about the audit and the “tea party” phrase in September 2012. Patterson would later claim that he didn’t even remember meeting with George that fall. Wh
en Jordan pressed him to try to remember the conversation, Patterson got testy. “All I can tell you is what I remember, okay?” he shot back. Jordan’s reply: “All I know is that Russell George remembers it differently.”
Connect these dots. Assuming the inspector general for the Treasury Department isn’t lying to the nation (and why would he?), both the top lawyer and the chief of staff to Treasury Secretary Tim Geithner knew about the targeting of conservative groups months prior to the presidential election. Does anyone truly think this information wasn’t relayed up the chain?
One possible answer came on May 16, 2013, when Bloomberg News’s Julianna Goldman asked President Obama a few pointed questions. Obama offered a careful response:
Goldman: Mr. President, I want to ask you about the IRS. Can you assure the American people that nobody in the White House knew about the agency’s actions before your Counsel’s Office found out on April 22nd?
Obama: [L]et me make sure that I answer your specific question. I can assure you that I certainly did not know anything about the IG report before the IG report had been leaked through the press.
Obama didn’t say that he was unaware of targeting. He didn’t say he was unaware of BOLO lists or Lerner or donor questions. He said he didn’t know about the IG report. That’s a little different.
Some in Treasury and the White House knew about the TIGTA report an entire month before Lerner’s bombshell, and in fact coordinated with the IRS to craft the manufactured Lerner admission. As early as April 16, Treasury’s deputy general counsel informed a White House attorney about the inspector general’s findings, telling him (at the very least) that the “IG had identified some problems or concerns with the application process as it related to conservative organizations.” Miller, the IRS head at the time, ran nearly every detail of the Lerner apology—to the time and date and circumstances—past Treasury, which in turn informed the White House deputy chief of staff about the plan. This was done, said a Treasury official, “so that the White House wouldn’t be surprised by the news.” Some of the frantic calls in those last days also included yet another White House lawyer and a press official. And yet Obama to this day insists he learned about the entire affair through the news.
The more Jordan, Orrin Hatch, and groups like Judicial Watch dug, the more they uncovered evidence that Democrats drove the IRS targeting from day one. From the moment Obama won the 2008 election through early 2013, the tax agency fielded no fewer than thirty-five formal congressional requests for investigations into, or new rules covering, tax-exempt organizations. Many went express to the IRS commissioner’s office. Investigators also found e-mails showing IRS staffers assisting Democratic members with their own probes into conservative groups, and in turn getting “heads-up” tips about that congressional work. Miller would later admit that it was all this pressure that forced the internal IRS debate about how to handle (c)(4)s: “I mean, I think we were—we had, you know, [Michigan senator Carl] Levin complaining bitterly to us about—Senator Levin complaining bitterly about our [regulation].…And, you know, we were being asked to take a look at that. And so we were thinking about what things could be done,” Miller confessed.
The press put a lot of emphasis on Baucus and Durbin and other senators who’d written letters to the IRS with specific demands. Levin’s own role was far more integral and direct, effectively raising him to the level of conspirator. Levin, too, signed on to those IRS letters demanding probes of conservative groups. But he was far more aggressive in his demands, handing the IRS specific target lists in the run-up to the 2012 election. In a July 2012 letter, he listed twelve groups he wanted investigated for political activity. Eleven of those were conservative organizations (he tossed in one liberal group for good form). In September, he demanded that the IRS provide him political spending figures for a list of conservative players. Miller wrote back that “as discussed” in two earlier responses to Levin (the IRS and Levin communicated a lot), the agency wasn’t legally allowed to tell him whether the organizations on his list had even applied for tax-exempt status. Levin kept up the pressure, complaining that the IRS “misinterprets” the law. He at one point called the agency’s failure to prosecute conservative groups “unacceptable.” He also told the New York Times (incorrectly) that “tax-exempt 501(c)(4)s are not supposed to be engaged in politics,” and vowed that “we’re going to go after them.” Levin in May 2013 scheduled his Senate Permanent Subcommittee on Investigations to hold hearings into the IRS’s failure to “enforce the law” on nonprofits engaged in “partisan politics.” He canceled it when Lerner dropped her bombshell.
What no one found out until after that fallout is that Levin’s subcommittee had spent the entire year of 2012 dragging IRS officials in front of it, putting the screws to them over nonprofits. One of the officials attending those frequent meetings was Lois Lerner. Also attending was staff from ranking member John McCain’s office.
Interestingly, Levin himself revealed these facts. As the IRS scandal exploded, the Michigan Democrat clearly sensed how bad it would look for Republicans to uncover these meetings, so he decided to get out ahead of the news. He released the information in an extraordinary joint letter (with McCain) to Danny Werfel a few weeks after Lerner’s announcement. The letter began as a full-throated call to suspend Lerner from the IRS. Levin and McCain explained that among the reasons for why this should happen was that Lerner had failed to disclose the targeting to them in the course of their own “investigation” into nonprofits and the “statute.” That’s how Levin and McCain cleverly slipped out the news that they’d conducted “a year’s worth of correspondence between the Subcommittee and the IRS, as well as document productions and repeated consultations with IRS staff.” The letter was carefully worded, designed to reveal yet minimize the committee’s pressure on the IRS. McCain undoubtedly had the Keating scandal in his mind. Twenty-five years earlier he’d got rapped for pressuring a regulator in the banking sector. He didn’t now want to be accused of bullying the IRS. (It didn’t help. McCain would later be accused by conservative groups of taking part in the targeting, an accusation he reacted to with a furious press release, calling it “demonstrably untrue.”)
It was Judicial Watch, again, that obtained papers documenting Lerner’s attendance at one of those Levin meetings. “We don’t know exactly what happened at that meet-up,” notes Fitton. “But suddenly you have these two senators—after the sugar hits the fan—claiming to be outraged by the IRS’s actions. And doing so in a letter designed to exonerate them from their own roles.”
Investigators also quickly demolished what had become a favorite Democratic claim: that liberal groups had also been targeted. TIGTA himself had undercut this baloney in his report, simply listing the numbers. The IRS targeted 292 conservative groups, and all 292 were put under review. It subjected 6 liberal groups to review. And while it’s true that the term “progressive” was later found on the infamous BOLO list, it was in a section of that spreadsheet that ultimately wasn’t used by screeners to isolate targets. Only one side got the IRS treatment.
Chapter 11
The Fix Is In
Jim Jordan, Orrin Hatch, Dave Camp, Russell George, dozens of staffers, and Judicial Watch toiled along, unraveling the affair bit by bit. They were joined by yet one more powerful force in the sleuthing. The targeted Tea Party groups might have been molested by the IRS, but they refused to surrender to a victim’s mentality.
The targets spent three years in turmoil—first in suspended animation, then confusion, then fear. The consequences were very real. Democrats wanted the IRS to shut these groups down, and at a crucial time—the elections of 2010 and 2012. They got their wish.
Fitton notes that it wasn’t as clear-cut a victory as some on the left would have liked, but it worked all the same. “Lerner had been at the FEC. She knew the law inside out. And she knew that any formal action would likely get slapped down by the courts. So rather than reject applications, she did the next best thing. She
kept them in limbo, so that the groups couldn’t fully operate.” He throws in an additional irony: The only reason why Lerner could do this was because conservative groups were trying to do the right thing. “The truth is, the law doesn’t require you to immediately file an application to get (c)(4) status. The smart groups on the left sure weren’t doing it. It was just the poor suckers in the Tea Party, who, because they tried to cross the T’s and dot the I’s, the whole movement was shut down.”
Lerner hadn’t hit full operational speed by the 2010 midterms, and the “shellacking” that Obama received in that election was in no small part due to Tea Party groups spreading the words on issues and getting out the vote. By the estimates of one study, the Tea Party pushed an additional 5.8 million additional Republican voters to the polls in 2010. But the IRS muzzling took its toll on the movement in the two years that followed. Grover Norquist, president of the influential Americans for Tax Reform, makes a compelling argument in his own book on the IRS, End the IRS Before It Ends Us, that Obama’s siccing of the agency on conservative groups saved his presidency. He intimidated them out of the game.
Many groups pulled their applications, tired of the hassle. Others couldn’t get funding from donors and dwindled away. Some got hit by a weird fillip in the law that subjected them to an automatic revocation of their application if it dragged on too long—an issue that Lerner was aware of, and made use of. Some, wary of the delays, and the stories they were hearing, and the questions they received, pulled back on their activities and toned down their work. “They couldn’t handle the onslaught,” says Jordan. “These were people doing this in their garage. Or part-time. Or in the spare minutes, away from their real job, when they had a moment to send out an e-mail. And that’s the part that most bothers me. I despise the bully picking on the weak kids in the playground. This is the sophisticated, powerful IRS going after folks hand-painting signs in their backyard.”
The Intimidation Game Page 17
