IT WASN’T JUST THE PRESS that sensed dynamite ahead in the recent Senate hearings on the Internal Revenue Service. The Clinton administration was alarmed at the prospect of testimony from IRS agents indignant over abuses of power by their own agency. A senior Treasury official even pressured an aide to Finance Committee chairman William Roth to reveal the agents’ identities, arguing their testimony could provoke anti-government terrorism.
Roth’s aide refused to be bullied, and the hearings did indeed embarrass the administration: Seven IRS agents testified, six anonymously, and they painted a bleak portrait of the agency. They described a vindictive, heartless place whose managers encourage the reckless mistreatment of taxpayers. CNN, C-SPAN, MSNBC, and the Fox News Channel carried portions of the hearings live. The networks, newspapers across the country, and Sunday talk shows like This Week and Face the Nation prominently featured the IRS abuses. The public flooded the Finance Committee with phone calls, faxes, e-mails, and letters — more than 2,500 so far.
The three days of hearings were a windfall for the GOP They elevated the party’s issue — taxes — to the top of the national agenda, and when the spotlight is on taxes, Republicans gain. Not only that, but last week the president and Treasury secretary Robert Rubin were in the uncomfortable position of speaking out against proposals to reform the IRS.
The success of Roth’s IRS hearings stands in stark contrast to the dubious results of Fred Thompson’s hearings on fund-raising misdeeds. The Thompson hearings have been plagued by uncooperative witnesses, GOP turf wars, Democratic stonewalling, a complicated story line, a bloated staff, and an incompetent investigation — while Roth’s boasted humble citizens mistreated by government, near-total cooperation between the committee’s Democrats and Republicans, and a simple story to tell. In fairness to Thompson, IRS misdeeds have broader shock value than fundraising high jinks. Yet Thompson’s staffers could learn from those who did the preparatory work for Roth — notably chief investigator Eric Thorson.
Roth launched his inquiry in late January after hearing complaints from his Delaware constituents of reckless IRS investigations. Shortly thereafter, the front-page “Tax Report” column of the Wall Street Journal mentioned the investigation, and soon the Finance Committee was being contacted by people with stories of IRS abuse. Each of the reports — and eventually there were over 1,000 — was methodically scrutinized by Thorson and his three-person staff, who finally settled on the four individuals with the most compelling and credible stories to tell about the hardships they had suffered at the hands of the IRS.
Compelling they were. There were tales of harassment, fabricated evidence, perjury, retaliation, and cover-ups. Female witnesses cried and men described physical suffering. The hearings were capped by testimony from the acting IRS commissioner, Michael Dolan, who gave a half-baked defense of the agency, but conceded it had handled these particular cases “very badly,” for which he was “extraordinarily sorry.”
Dolan portrayed the IRS as a friendly, service-oriented place where employees are encouraged to come forward if they see any wrong-doing around them. Yet without even looking, Roth’s investigators found an agency where many employees said they lived in fear of management: Every aggrieved agent who spoke with Thorson came forward unsolicited. The agents called or wrote with stories of IRS malfeasance and usually gave their home telephone numbers, as they feared talking to Senate investigators from their workplace. When a story sounded particularly persuasive, investigators asked whether the agent would be willing to testify. Of those who said they were, only one was willing to reveal her identity publicly. Six others delivered their testimony from behind a screen and had their voices altered. Nearly all of the spadework was conducted over the phone; each of the IRS agents who testified gave at least 15 pre-hearing phone interviews to Thorson and his team.
This diligence was demanded by Chairman Roth, who may seem an unlikely figure to lead a highoctane investigation and to chair three days of boffo hearings. Roth is a genial 76-year-old with a passion for tax reform; he was the Senate sponsor of Jack Kemp’s tax cut enacted in 1981. Otherwise he leaves few footprints on Capitol Hill. After nearly 27 years in the Senate, however, he knows how to run a hearing. And after two years chairing an investigations sub-committee, he knew he could trust Thorson.
One of the most important reasons for Roth’s success is the cooperation he received from Senate Democrats. From the beginning, the chairman conveyed that this was not a partisan undertaking; it helped that Thorson had spent five years working for the House Government Operations Committee when the Democrats controlled it. Finance Committee Democrats supported Roth’s effort from the outset, and at the hearings, not even liberals like Sen. Carol Moseley-Braun were sympathetic to the IRS.
The question now is whether congressional Republicans can replicate the success of Roth’s hearings in other areas. Oversight can be a remarkably effective way to bolster public support for one’s agenda — remember when Rep. Henry Waxman had tobacco executives testify about the link between smoking and lung cancer?but Republicans have neglected it (with the notable exceptions of Reps. David Mcintosh and Charles Canady). Indeed, these were the first oversight hearings ever held by the Senate Finance Committee.
House majority leader Dick Armey, for example, could be spending his spare time highlighting the destructive hand of government. Instead, he’s traveling the country with one of his Republican colleagues, Rep. Billy Tauzin, debating the relative merits of a fiat tax and a national sales tax. Armey, Tauzin, and the other Republican tax-reformers have missed something: Americans may think their taxes are too high, and they may think tax collectors are imperious, but polls show they are not prepared to scrap the tax code or abolish the IRS.
Roth’s hearings may have begun to change that, and he’s planning to keep up the drumbeat. He told me he won’t be satisfied “until all law-abiding citizens feel they can go to the IRS and get a fair hearing.” It’s a tall order, but, as the recent hearings demonstrated, one that’s worth pursuing.
Matthew Rees is a staff writer at THE WEEKLY STANDARD.
