I was on my way to a meeting in Houston yesterday and was listening to the Ways and Means IRS hearings on Sirius (while fighting through Houston traffic) and I heard an exchange between a Democratic member of the committee and Steve Miller, former acting head of the IRS, about the appropriateness of having Sarah Hall Ingram as the head of the IRS’ Obamcare enforcement arm. It was an attempt to deflect the concerns that were raised by the Republican members that if the wisdom of putting a person in charge of hundreds of millions of health care records was a little suspect when this was the very same person who was in charge of the group that singled out conservative organizations applying for tax-exempt status for intense scrutiny and delays while allowing any liberal-leaning applications to sail through the process.
Miller assured the committee members that the IRS having access to these personal records was just not possible, that the only role of the IRS was to look at who was eligible for a government subsidy to buy insurance and who wasn’t.
But how credible is this? Would you not have to look deeper into the reasons why? What if someone was claiming eligibility who was not actually eligible? Would the IRS not have to dig deeper into the reasons?
The Democrats tried to excuse the scandal away by saying that to do the job of vetting the applicants for tax-exempt status, they IRS examiners had to dig through massive amounts of data.
Why would the same not be true to determine eligibility? Will they not have to match financial records to health records to make this determination?
The protection that Steve Miller offered was that it was simply against the law for them to dig into personal information.
But individuals and groups within government have proven time and again that they are not interested in the law when motivated by any of a number of different stimuli.
- There is an ongoing lawsuit in California for the IRS illegally accessing the health records of over 10 million American citizens.
- Remember when State Department employees illegally accessed the passport records of BHO, Hill and John McCain?
- Or that time that the EPA released all that personal data on private citizen farmers?
- Or that time the Florida state government made $49 million selling your data?
Nah. Not to worry. Move along, nothing to see here…but for a minute, let’s forget about the access they will have if Obamacare is not stopped and focus on the operation of the IRS.
This is an organization that reportedly demanded access to the back end of Tea Party group websites (i.e. comments, emails, subscription lists), wanted to know about relatives of the organizations, wanted to know about affiliation between the groups and some private citizens and even wanted to know the total content of flyers, reading lists and even prayers.
And yet even with this degree of specificity on and scrutiny of the Tea Party organizations applying for tax-exempt status, they paid out over $11 billion dollars in what the Washington Post calls “improper payments” through just one program, the Earned Income Tax Credit:
The Internal Revenue Service issued more than $11 billion in faulty refunds through its Earned Income Tax Credit last year, according to an inspector general’s report released this week.
Treasury Department Deputy Inspector General Michael McKenney found that the IRS has failed for the past two years to comply with a federal law requiring agencies to reduce payment errors to a rate of less than 10 percent. President Obama signed the statute in 2010.
Note that this was $11.6 billion dollars in one year.
The WaPo goes on to say:
The IRS estimates that at least 21 percent of its EITC payments in 2012 were faulty. That rate represented a decline compared with the previous nine years, but the total value for improper payments increased about 22 percent over that same period to at least $11.6 billion in 2012, according to the inspector general’s report.
The Earned Income Tax Credit awards tax refunds to low-income working individuals and families, especially those with children. The report said the IRS uses unreliable processes to assess the risk of improper payments through the program.
21%. That is getting it wrong 1 out of every 5 times…and this was not in the total population of returns, it was only in the subset of returns that claimed the EITC. It is nice to know that even though they can’t get this right, they sure can find the 0.73% error that I made, one that cost me an additional $7,600 in taxes and that the check I sent them is being wisely utilized by making billions of dollars in improper payments.
As the chart below from the February 25, 2013 Treasury Inspector General for Tax Affairs audit report shows, this is the best they have done over the last 10 years.
In reality, when you read to the end of the report the fact that they overpaid by $11.6 billion in a year (or even the 110.8 billion over the last 10 years) isn’t even the scary part – the scary part is that they don’t even know what the proper payments should be:
In addition, the IRS improper payment rate still does not include an estimate of EITC underpayments. The IPERA states that reported improper payment estimates should include instances of underpayments, i.e., the recipients received less than they were entitled to receive, as well as overpayments, i.e., the recipients received more than they were entitled to receive. In response to our previous report evaluating the IRS’s compliance with Executive Order 13520, the IRS agreed to assess the impact of EITC underpayments on the improper payment rate. The IRS indicated in its Fiscal Year 2012 IPERA reporting that EITC underpayments “do not appear with sufficient frequency in the statistically valid test data to have a measurable effect on the estimate.”
Not a freaking clue – and yet they want to know what prayers are being said at a suburban Tea Party meeting.
I know that Americans tend to be able to focus only on the shiny objects (kind of explains Kim Kardashian and Paris Hilton) and that the magnifying glass is currently being held over this scandal but this isn’t the sum total of the scandal because this isn’t just the IRS – what about a federal government program that already has access to private health records – Medicare?
“In fiscal year 2011, Medicaid had the second-highest estimated improper payments of any federal program at $21.9 billion. GAO’s work outlined steps necessary to make the error rate more timely and meaningful,” said Ranking Member Coburn. “As they note, capturing an accurate reading currently takes three years-worth of data. While Congress has a responsibility to ensure the soundness of the program, bureaucrats in Washington can’t micromanage Medicaid and fix all of its problems. Improper payments are best reduced when accountability is strong, incentives are aligned, and states are leaders. I look forward to working with my colleagues to put Medicaid on a more sustainable path.”
Twice the improper payments of the IRS’ EITC program.
There are simply too many layers of political insulation for these individuals to be held accountable – even the main players in the Fast and Furious gunwalking scandal were only reassigned, nobody got fired. Obama asked Steve Miller to “resign” even though he was leaving in June anyway. He did “fire” a guy who had been on the job for two weeks – but the woman responsible, Sarah Ingram, got a promotion.
Nothing to worry about there, huh?
No, the real scandal isn’t the IRS denying Tea Party groups tax-exempt status on the basis of political beliefs, the real scandal is that there even exists a government agency that has the power to do that. The real scandal is that we are even talking about turning over any more of our liberty to a central government with the power, the reach and the potential for political corruption that is possible with the entrenched bureaucracy that exists today.
The “don’t listen to the voices who claim government tyranny and just trust us” solution of the Obama administration and the Democrats rings hollow when faced with the facts.