Power Line

Posted on May 20, 2013 by Paul Mirengoff in IRS, Obama Administration Scandals

GOP’s emerging IRS scandal narrative isn’t compelling

Eliana Johnson correctly identifies the emerging GOP narrative about President Obama’s relationship to the IRS scandal. The president, we are told, has fostered a “culture of intimidation” that encourages the vilification of one’s political opponents, thus inducing bureaucrats to target those whom the president has demonized.

I understand why the GOP is pressing this line. So far, it lacks evidence of White House involvement in the scandal, but wants to blame Obama anyway. And Obama has tended to vilify his political opponents.

Unfortunately, however, the “culture of intimidation” narrative strikes me as weak and whiney — the kind of thing I’d expect from Democrats. In fact, it’s similar to attempts to blame violence such as the Arizona shooting of Rep. Giffords and others on the “demonizing” rhetoric of conservatives.

Politicians are responsible for their words, for the actions they advocate, and for the actions they take. But they are not responsible when/if a third party is motivated by their words to take actions they haven’t advocated. To argue otherwise is to discourage forceful advocacy. Politicians’ words can affect listeners in a wide variety of ways. They shouldn’t worry about how extremists will be affected.

I happen to agree that some of the rhetoric and tactics Obama has employed against his critics, including the Tea Party, is unpresidential at best. Eliana’s piece provides examples. George W. Bush, and indeed most of Obama’s predecessors, absorbed harsh attacks without responding in kind. Richard Nixon is the main exception, and this fact supports comparisons between Nixon and Obama.

Obama therefore deserves criticism for the way he deals with political opponents. But that criticism is independent of the wrongdoing of overzealous partisans within the civil service. Obama’s rhetoric would be just as offensive if the IRS had not acted improperly and is not made more offensive because the IRS has done.

I also believe that Obama has little appreciation for the democratic process, including the right to dissent from his agenda without suffering for it. In my view, he regards democracy and dissent as hindrances to the march of history he fancies himself leading.

But to make this indictment stick, we must point to concrete evidence, such as that mentioned in Eliana’s piece. Speculation that bureaucrats acted improperly because of Obama’s rhetoric doesn’t meet that standard.

Having observed the federal bureaucracy up-close for 45 years, I can testify that many bureaucrats don’t need presidential rhetoric to advance left-liberalism through improper and/or abusive action. In fact, they do so even when the president is a non-liberal.

But this isn’t really my point. Whatever may be true of federal bureaucrats, trying to link their misconduct to general presidential rhetoric is a lazy man’s game. It smacks of whining and is unlikely to resonate except among those who already dislike Obama.

There are two valid takeaways from the IRS scandal. First, it confirms that big government, whose power Obama is bent on expanding, cannot be trusted to behave properly. Second, it calls for further investigation to determine how high up the chain the wrongdoing extends and whether the administration acted promptly to stop the targeting once it learned of that activity.

Posted on by Paul Mirengoff in Benghazigate

Connecting the dots on the video

As Scott discussed earlier today, the absence of any reference in the Benghazi talking points to the Muhammad video has raised a new set of questions about the scandal. Among the questions are: (1) why isn’t the video mentioned in the talking points and (2) how, given the video’s absence therein, did it become the centerpiece of subsequent explanations of the attack, including Susan Rice’s.

As to the first question, Mike Morrell, the Deputy Director of the CIA, says he drafted the final version of the talking points. Morrell’s mission was not to state the CIA’s view — the original CIA talking points did that. Rather, he was tasked with coming up with a version that reflected the “equities” and concerns of those who had objected to the original talking points, notably the Department of State.

In performing this function, Morrell was willing to scrub the talking points of all content that the State Department and the White House disliked. That meant the removal of references to terrorism and to prior warnings that attacks might occur.

But Morrell did not include any mention of the video. Why? There are two possibilities. First, the video didn’t come up in any of the discussions in which Morrell participated. Second, the video came up, but Morrell was unwilling to mention it because he doubted its relevance. In this scenario, Morrell was willing to scrub the talking points, but not to convert them into a piece of misdirection.

Which of these possibilities is the more likely? The video doesn’t come up in the email traffic released by the White House until it is referenced in the subject line of a Saturday afternoon email from “USUN” to “Susan Rice, USUN” (page 92 of the documents). Specifically, the subject line reads “SBU/Closehold: 0800 STVS on Movie Protests/Violence.”

Thus, the video, and its alleged relation to the violence on 9/11/12, apparently was discussed during a conference (on the “Secure Video Teleconferencing System”) that occurred early Saturday morning. But I cannot tell who participated in that conference. The memo about the conference has been completely redacted. And I couldn’t find any other email that specifically discusses this conference.

Was the “0800 STVS on Movie Protests/Violence” the main Saturday morning conference during which the concerns of the State Department were thrashed out. Or was this a different conference? Morrell, of course, was at the main conference. But if there was a side conference, he might not have participated.

In any case, by around 11:00 on Saturday morning, Morrell had re-drafted the talking points into something very close to their final form, based on the main conference that took place earlier that morning. And the talking points did not mention the video. Most likely, the video had been, at most, a footnote in the Saturday morning conference with Morrell at which the State Department advanced its “equities.”

It was on Saturday afternoon, after the talking points had been finalized, that the video began its ascent from (at best) an omitted footnote to the core explanation of the Benghazi attacks. Unfortunately, the only email (or the only one that has been released) that might shed light on this ascent is completely redacted.

It seems likely, though, that on Saturday morning (if not earlier) the video was percolating in the minds of White House and/or State Department officials as something they wished to inject into the narrative. However, these minds realized that, with Congress pushing hard to receive the talking points and the CIA involved in the process, it was not feasible to weave the video into the talking points.

In other words, the best that could be done with the talking points was damage control — the elimination of “harmful” information. The insertion of the video would have to occur “off-line,” after the CIA was out of the loop but before Rice went on the Sunday talk shows.

But who actually decided that the talking points would be the centerpiece of Rice’s appearances? Karl Rove suspects the White House via Ben Rhodes and Tommy Vietor. I suspect the State Department with clearance from the White House.

But the bottom line is, we don’t know. Additional hearings are required. Susan Rice should be a star witness.

Posted on by Scott Johnson in Constitution, Obama administration

Live from the Upper Midwest Employment Law Institute

I’m attending the two-day Upper Midwest Employment Law Institute in St. Paul this year. It’s a great program that attracts leading practitioners from all around the country. I have attended several times in years past, but this year I’m here because I need the continuing legal education credits (including Minnesota’s offensive get-your-mind right elimination-of-bias requirement) before June 30. The institute program draws a large audience which begins with plenary sessions for a couple of hours each morning followed up by breakout sessions in specialized areas.

It didn’t occur to me that anything of general interest might be happening here, but one of the speakers is NLRB acting general counsel Lafe Solomon. At the plenary session an hour ago Solomon addressed the legal limbo in which the NLRB now finds itself as a result of the D.C. Circuit’s ruling on the unconstitutionality of Obama’s recess appointments to the board. More generally, he described the board as under assault politically, legislatively and judicially.

Solomon reported that the Third Circuit issued a decision last week in harmony with the D.C. Circuit ruling. Solomon is optimistic that the Court will vindicate Obama’s recess appointments in the end, but the Court hasn’t yet taken the case and a ruling would not be issued before somewhere near the end of the Court’s term next year. (See this handy recess appointments litigation resource page for details and developments.)

Solomon conveyed a mournful angst and subliminal anger about the situation in which the board finds itself. Perhaps it is the bureaucratic equivalent of combat fatigue.

At the moment I am in a breakout session with Solomon in which he is providing an in-depth update on board issues. Despite his funereal affect in the plenary session this morning, he perked up when I asked if I could snap a photograph (above left) on my iPhone for this post, to which he graciously consented.

Posted on by Steven Hayward in Economy, Taxes

The Other Tax Hearing to Watch This Week

I’ve expressed my puzzlement and disappointment here before about how Apple, like so much of Silicon Valley, is reflexively liberal in its politics. So it is with some curiosity that I note the story out last week about how Apple CEO Tim Cook was trying to “get out ahead” on the story of his appearance before a Senate committee tomorrow in Washington where he will essentially be called unpatriotic—by both parties unfortunately—because Apple doesn’t engage in the sadomasochism of bringing home to America the roughly $100 billion in profits it has earned overseas—and is keeping there to avoid America’s punitively high corporate income tax rates.

From all appearances Cook is going to grovel and apologize. According to one story:

In an interview with The Washington Post, Cook says he plans to present specific proposals at the Senate hearing to overhaul the U.S. corporate tax system.

“If you look at it today, to repatriate cash to the U.S., you need to pay 35 percent of that cash. And that is a very high number,” Cook said in an interview Thursday. “We are not proposing that it be zero. I know many of our peers believe that. But I don’t view that. But I think it has to be reasonable.”

Cook also pointed out that if state and federal taxes are combined, Apple pays roughly $1 million per hour in taxes, possibly making Apple the largest corporate taxpayer in the country.

He shouldn’t be defensive. Rather, he should take a page from Intel from about 20 years ago. Back in the early 1990s, when California’s fiscal situation was similar to today (in other words, deeply under water), Gov. Pete Wilson proposed abolishing the sales tax on capital equipment purchases by manufacturers. While Nordstrom or Home Depot have to locate where consumers are, manufacturers can locate anywhere, and the sales tax on capital equipment was a huge disincentive to expanding or building new plants in CA. Intel figured this tax added as much as $60 million to the cost of a new plant.

Democrats naturally opposed abolishing the tax because “we need the revenue,” oblivious as always to incentive effects. So Intel’s tax manager appeared before the State Senate finance committee and explained the facts of life, as Intel was in the midst of deciding whether to build a new billion-dollar chip plant in California or New Mexico, which didn’t have a sales tax on capital equipment. As I recall, his point to the committee went something like this:

You’re not going to collect this sales tax on capital equipment from Intel. There are two ways you’re not going to collect this tax. You won’t collect this tax if we build our new plant in New Mexico. And you’re not going to collect this tax if we build our new plant in California. Get it?

Of course the Democrats didn’t get it at the hearing. Their economic illiteracy would be comical if it didn’t have such baleful consequences. Gov. Wilson stuck to his guns, and the tax was eventually abolished, I believe.

So I wish tomorrow morning that Tim Cook would look senators directly and say this:

There are two ways you’re not going to exact America’s highest-in-the-world corporate income tax on Apple. You’re not going to collect it if we keep the money overseas, as is our right under the tax code that you people wrote into law; and you’re not going to collect it if we bring the money home. Get it?

I can certainly imagine Steve Jobs putting is this way.

Now back to the IRS scandal.

Posted on by Scott Johnson in IRS, Obama Administration Scandals

Where was Obama?

The Wall Street Journal reports that the White House counsel was advised of the Inspector General’s audit findings weeks ago. Doug Ross has compiled a useful IRS scandal timeline into which this latest tidbit fits.

A friend with substantial experience as a chief executive officer looks back on what we have learned to date about the IRS harassment of Obama administration political opponents. He raises the issue of executive responsibility:

Someone needs to call out Obama on the phony claim that he was precluded from being alerted in 2012 because of the investigation. They are hiding behind the existence of the investigation to justify his failure to act. His staff has an obligation to bring to his attention any improper and illegal activities and he has the authority and obligation to act upon hearing of them. Once alerted, and the activities halted, the investigation could proceed unhindered. If Obama’s logic prevailed, the mere initiation of an IG investigation gives you a hall pass to do anything you want until it leaks.

In this case, there is no evidence that the targeting activities were stopped once the IG office began its inquiries. They got the best of all worlds — unhindered political malfeasance in an election year and claims they were powerless to do anything about it. We, of course, know they didn’t want the activities to stop, which explains why they are taking the position that it was “out of their hands.”

UPDATE: My friend writes to specify that he was referring to the June 2012 alert given by the IG to senior Treasury department officials:

Upon hearing of such potential improper activity, the administration had an obligation both to alert his superior and to take immediate action to get it stopped. A simple memo could have been written to halt the activity immediately: “We are concerned improper targeting may be taking place. Please alert us if you are aware of any activity like this occurring. If you have initiated such activity, halt it immediately.”

By neglecting to take action to halt the activity immediately, the administration is guilty of suborning it. Any business executive that caught a whiff of something in his or her business such as bribery, insider trading, or out-of-compliance quality, and delayed halting it, would face legal sanctions.

On a related note, a reader points out the dog that didn’t bark in Doug Ross’s timeline: “One obvious omission from the table of events is a stopped the targeting event, which is one key….Congress does not ask the critical question.”

Posted on by Steven Hayward in Barack Obama, Race and racial bias

Bill Cosby, Vindicated . . . By the Obamas?

Cast your mind back about ten years or so to a series of speeches that got Bill Cosby in a lot of trouble, especially his 2004 speech to the NAACP Awards dinner. The Cos took aim at dysfunctions in the black community . . . and he was slammed for “blaming the victim” and taking focus away from white racism. Here’s an extended excerpt:

Ladies and gentlemen, I really have to ask you to seriously consider what you’ve heard, and now this is the end of the evening so to speak. I heard a prize fight manager say to his fellow who was losing badly, “David, listen to me. It’s not what’s he’s doing to you. It’s what you’re not doing. (laughter).

Ladies and gentlemen, these people set, they opened the doors, they gave us the right, and today, ladies and gentlemen, in our cities and public schools we have fifty percent drop out. In our own neighborhood, we have men in prison. No longer is a person embarrassed because they’re pregnant without a husband. (clapping) No longer is a boy considered an embarrassment if he tries to run away from being the father of the unmarried child.

Ladies and gentlemen, the lower economic and lower middle economic people are not holding their end in this deal. In the neighborhood that most of us grew up in, parenting is not going on. In the old days, you couldn’t hooky school because every drawn shade was an eye. And before your mother got off the bus and to the house, she knew exactly where you had gone, who had gone into the house, and where you got on whatever you had one and where you got it from. Parents don’t know that today.

I’m talking about these people who cry when their son is standing there in an orange suit. Where were you when he was two? Where were you when he was twelve? Where were you when he was eighteen, and how come you don’t know he had a pistol? And where is his father, and why don’t you know where he is? And why doesn’t the father show up to talk to this boy?

The Atlanticsummed up the backlash:

The playwright August Wilson commented, “A billionaire attacking poor people for being poor. Bill Cosby is a clown. What do you expect?” One of the gala’s hosts, Ted Shaw, the director-counsel of the NAACP Legal Defense and Education Fund, called his comments “a harsh attack on poor black people in particular.” Dubbing Cosby an “Afristocrat in Winter,” the Georgetown University professor Michael Eric Dyson came out with a book, Is Bill Cosby Right? Or Has the Black Middle Class Lost Its Mind?, that took issue with Cosby’s bleak assessment of black progress and belittled his transformation from vanilla humorist to social critic and moral arbiter. “While Cosby took full advantage of the civil rights struggle,” argued Dyson, “he resolutely denied it a seat at his artistic table.”

Cosby dutifully shut up after this. So it is with considerable irony that I note both Obamas, in commencement speeches over the weekend, gingerly revisited some of the themes Cosby endorsed. Here’s Michelle Obama at Bowie State on Saturday:

And as my husband has said often, please stand up and reject the slander that says a black child with a book is trying to act white. Reject that.

Actually I’m not sure how often her husband does say that, but I know that early on in Obama’s presidency I and many others suggested that if he really wanted to make a mark as president, he and Michelle would engage a sustained campaign, along the lines of Nancy Reagan’s “just say no” campaign, to affect the status of the black family in America. President Obama came close to Cosby territory in his commencement speech yesterdayat Morehouse College, Martin Luther King Jr’s alma mater. A lot of the speech was boilerplate liberal rot as you’d expect, but there was this:

We know that too many young men in our community continue to make bad choices. And I have to say, growing up, I made quite a few myself. Sometimes I wrote off my own failings as just another example of the world trying to keep a black man down. I had a tendency sometimes to make excuses for me not doing the right thing. . .

Nobody cares how tough your upbringing was. Nobody cares if you suffered some discrimination. And moreover, you have to remember that whatever you’ve gone through, it pales in comparison to the hardships previous generations endured — and they overcame them. And if they overcame them, you can overcome them, too.

You now hail from a lineage and legacy of immeasurably strong men — men who bore tremendous burdens and still laid the stones for the path on which we now walk. You wear the mantle of Frederick Douglass and Booker T. Washington, and Ralph Bunche and Langston Hughes, and George Washington Carver and Ralph Abernathy and Thurgood Marshall, and, yes, Dr. Martin Luther King, Jr.

These men were many things to many people. And they knew full well the role that racism played in their lives. But when it came to their own accomplishments and sense of purpose, they had no time for excuses.

I wonder whether Frederick Douglass and Booker T. Washington are really taught well at Morehouse (or at any university these days), and I wish Obama would do more of this kind of thing. But this is a good start.