The worst offense in this IRS scandal hasnít been the manner in which conservative organizations were targeted for review and blocked from participating in two election cycles. No, disenfranchisement of conservative nonprofits wasnít the IRSís biggest sin; it was the ďoutingĒ of conservative donors who were promised anonymity
, and whose anonymity is protected by an important Supreme Court case.
Back in the 1950s, the NAACP was working hard to desegregate the South, and it was starting to gain traction in this effort. Thatís when some Alabama government hacks hatched a scheme: Why not compel the NAACP to reveal its donor lists? Alabama tried it, and the NAACP declined. Alabama then turned around and hit the NAACP with a civil contempt charge, issuing a $100,000 fine for refusing to comply with state orders. Alabamaís intent was clear: to chill further donations and cut off the NAACPís money supply. And money is the lifeblood of any corporation, even a nonprofit one.
Donors to the NAACP had good reason for wanting to remain anonymous. They feared personal reprisals and worried their businesses might be punished, or worse, especially if they were white Southern donors.
The Supreme Court saw right through Alabamaís attack on the First Amendment rights of free association and free speech. Alabama lost, the NAACP was vindicated, and the Court set an important precedent.
Flash forward 55 years and we have an out-of-control IRS that is illegally disclosing the identities of people who donate to organizations that support limited government and traditional marriage. And the IRS outed these individuals for the same reasons that the segregationists in Alabama wanted to out the NAACPís donors. The IRS then took things one step further and actually targeted some of those donors with IRS audits.
Thatís about as bad as bad can be.
And when the IRS goes after you, itís worse than when a prosecutor goes after you for committing a crime. Youíre not innocent until proven guilty; youíre guilty until proven innocent. The fines start. And the penalties. And the interest. And soon, your lawyer and your accountant are pleading with you to pay some money just to make the IRS meter stop running, even if you were guilty of nothing.
But for businesses across America ó in industries such as energy, health care, pharmaceuticals, and automobiles ó the administrative state is a force of nature they must deal with every day. The big federal agencies that regulate their part of the market are their IRS. And all across America, general counsels of companies that do business with the EPA, DOJ, FDA, and others are at the mercy of bureaucrats who can grind their businesses to a halt, fine them, accuse them of misdeeds, and make a general mess of their day-to-day operations.
Sometimes, the corporations deserve the scrutiny. But just as often, they donít. The calculation innocent companies must make is this: Is fighting the bureaucrats who rule over your business every day, and who hold sway over your reputation, worth the legal battles? Is the loss of money and time ó and the potential damage to your reputation ó worth it?
To many general counsels of American companies, the answer is a resounding no. So they agree to settlements even when their clients are innocent. And they do it because itís easier, cheaper, and more practical than facing the uncertainty of a prolonged, expensive legal battle.
Thatís power the Mafia wishes it had, the kind of fear a Tony Soprano wishes he could instill.
Too many bureaucrats have too much power over the day-to-day lives of ordinary, law-abiding citizens. When the administrative state comes knocking at your door, it is the worst day of your life. And it is because you know ó and the bureaucrats know, too ó that they have the power to make your life miserable. They can make you an offer you canít refuse.
Out of expediency and plain old common sense, too many Americans reluctantly submit to that power. So they pay ó only to live the next day a little poorer, a lot more timid, and much more cynical about government and its ability to tyrannize its own people.
That is the real story behind the IRS scandal: the power faceless bureaucrats have to ruin the lives of ordinary Americans, and with little oversight or accountability.
Americans have every right to ask some fundamental questions about this sad state of affairs: Who polices this administrative police state that David Axelrod described as so vast as to be unmanageable? And who punishes it when it commits crimes against its own citizens?
Where are the new Woodward and Bernstein valiantly digging to expose this kind of story? Where are 60 Minutes and Frontline? And the rest of the fourth estate? Where is the Innocence Project? Will John Grisham write a novel about the silent victims of the ever-growing and ever-more-powerful administrative state?
It would make for a great piece of fiction. If only it werenít so real.
ó Lee Habeeb is the vice president of content at Salem Radio Network. Mike Leven is president and COO of the Las Vegas Sands.