The IRS scandal has been a major point of conservative criticism during the last several years of the Obama Administration. When the tax-collecting agency specifically targeted groups whose descriptions included keywords and phrases such as “Tea Party,” “patriot,” and “teaching about the Constitution” for extra scrutiny in their applications for tax-exempt status, many said it was an unacceptable instance of political discrimination and chilling of free speech rights. (For more information, CCP’s interactive timeline of the scandal can be found here, and a PDF version is available here.)
While conservatives were outraged by the lack of accountability for high-level officials like IRS Director Lois Lerner, the scandal had ultimately faded into the background in the years since its revelation in May of 2013. The Obama Justice Department investigated Lerner’s actions for two-and-a-half years and ultimately declared there was no evidence of intentional, criminal behavior. Rather, it claimed that the abuses merely stemmed from bad management.
Despite the DOJ’s judgment, the federal courts have recently revived attempts to hold the IRS accountable for its harassment of Tea Party groups. The DC Circuit Court of Appeals unanimously ordered the reinstatement of part of a lawsuit against the IRS by two conservative groups who were seeking a court order against future abuse by the IRS. While the IRS had argued that the lawsuit had become moot since it had “voluntarily” ceased its discriminatory practices, the court expressed skepticism that this remedy had even been fully applied.
As Judge David B. Sentelle of the DC Circuit noted, “A violation of right that is ‘suspended until further notice’ has not become the subject of voluntary cessation, with no reasonable expectation of resumption… Rather, it has at most advised the victim of the violation – ‘you’re alright for now, but there may be another shoe falling.’” The fact that there are still some organizations that have been awaiting approval of their tax-exempt status for years further suggests that the exact issues that led to the Tea Party targeting scandal are far from fixed at the IRS.
This has crucial implications for free speech for a few reasons.
First, it is clear that in the particular case of the IRS, the tax code already allows a great deal of regulatory leeway that can lead to arbitrary, selective, and biased enforcement. This creates an environment of uncertainty for tax-exempt organizations, and could chill their speech in areas where they are legally justified in participating in public debate. Indeed, some lawmakers have suggested this controversy is an opportunity to further restrict social welfare organizations from engaging in issue advocacy.
Furthermore, skepticism of the IRS’s inclination to restrain itself can and should be applied to other federal agencies. There is reason to suspect that others would also try to actively stretch their authority within and perhaps even beyond existing law by claiming more regulatory powers.
Thus, supporters of political speech regulation are mistaken in trying to lavish even more authority to regulate campaign finance law to agencies besides the Federal Election Commission, which is an appropriate regulator in this area, despite its flaws. Over the years, pro-regulation activists and some politicians have pressured non-expert agencies like the IRS, Securities and Exchange Commission, and the Federal Communications Commission to regulate political speech. Agencies like these that are not expert in campaign finance law may be susceptible to the same direct or indirect political biases that were evident in the IRS (and already exist within the FEC), making these agencies susceptible to scandals of their own.
The IRS scandal is instructive of the notion that regulators and bureaucrats are, at the very least, fallible. It is incredibly risky to expose First Amendment speech rights to an even broader group of potential violators. As CCP has argued, the IRS (and other non-expert agencies) have no business acting as the speech police.