How the IRS Scandal Threatens Obamacare


Photo credit: OECD / Foter.com / CC BY-NC-ND

Obamacare is not merely a massive overhaul of the health care system. It is also a substantial expansion of the Internal Revenue Service. That's because the law relies on the tax collection agency to both enforce its individual mandate and administer the tax credits the law offers to subsidize the purchase of health insurance. Following recent revelations that agents in multiple IRS offices, including tax officials in Washington, targeted conservative groups for extra scrutiny, a number of former and current Republican legislators are already counseling caution about the agency's role in administering the law.

Concerns about the agency's oversight of the health law are well-founded—and not only because of general concerns about the agency's judgment.

For one thing, the IRS appears to have specifically targeted groups that opposed the health care law. According to The Washington Post, "although some of the groups were explicitly labeled 'tea party' or 'patriot,' others that came under intense scrutiny were focused on challenging the Affordable Care Act — known by many as Obamacare — or the integrity of federal elections."

In other words, the agency has singled out Obamacare opponents for unusual treatment. That does not speak well of the agency's ability to fairly carry out its duties under the law.

Perhaps more importantly, however, the agency has already launched an attempt to subvert the health law's clear statutory language. As I noted earlier today, the text of the legislation specifies that the law's tax credits for private insurance are available in exchanges created by states. It does not provide for those subsidies to be available in exchanges run by the federal government. Yet the IRS rule regarding the tax credits essentially ignored this, and allowed for the subsidies to be available in both state and federally run exchanges.

What this means is that the IRS is already taking creative liberties with the administrative duties it is assigned under the health law. It's already attempting to use its power to expand Obamacare beyond the specifics of its statute. It's already ignoring the text of the law when doing so suits its purposes. 

And it has done so with the explicit support of the same top official who claimed that there was "absolutely no targeting" of conservative groups going on at the IRS.

As the Cato Institute's Michael Cannon noted last week, former IRS Commissioner Douglas Shulman insisted in a 2012 congressional subcommittee hearing that the IRS was in no way singling out groups based on political outlook. We now know that to be false.

A year prior, Shulman insisted that the IRS rule regarding premium subsidies in federally run exchanges was "consistent with the language, purpose, and structure" of Obamacare. Tellingly, he did not point to a statute authorizing the IRS interpretation. Admittedly, that would have been difficult, because there isn't one. As the Congressional Research Service noted in its analysis of the law, a "strictly textual analysis of the plain meaning of the provision would likely lead to the conclusion that the IRS' authority to issue the premium tax credits is limited only to situations in which the taxpayer is enrolled in a state-established exchange." [Emphasis added.]

The IRS has already demonstrated dubious political and legal judgment regarding its role in the administration of Obamacare. More officials should question its judgment in matters related to the law. 

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  1. Because fuck you, that’s why. HAHAHAHAHAHAHA!


    1. This comment on reddit is pure, delicious LibertarianPorn. (A progtard is surprised and has The Sads b/c Obamacare made his premium spike.

      1. “I was sure that the hikes would only affect those evil RICH FOLK!”

  2. Don’t you mean “How the IRS Scandal, Fast and Furious, Benghazi, AP Phone Tampering, EPA Double Standards, Solyndra and Surely Another One Due Soon Threatens Obamacare The Entire Obama Administration?

  3. I hate to pro-actively OT the comments but: http://www.cnn.com/2013/05/14/…..index.html

    The NTSB is recommending that the 0.08 standard for blood alcohol level be lowered to 0.05.

    1. Of course they are.

    2. They won’t stop until any detectable amount is a crime.

    3. One reason I love Fred Thompson and wish he was still politically active, is that he was the only Senator to vote against lowering the limit from 0.10 yo .08. He thought it should be left up to the states.

      1. I wish he was still doing Law and Order: SVU.

    4. …What will be our legacy 30 years from now?” Hersman asked.

      The legacy will be, “NTSB recommended policy changes that resulted in the imprisonment of 70% of the US population”.

      Way to go!

    5. Already there in Ontario, Canada.

      1. Although it is not the full DUI charge until you reach 0.08

        1. Then what the fuck is the point? Oh, wait…CONTROL.

    6. They just gotta have that last 2% that gets off. I’ve seen intoxylizer experts successfully argue errors of up to .06 due to improper procedure.

  4. It’s already ignoring the text of the law when doing so suits its purposes.

    You mean laws mean what they say, not what people want them to mean?

    Next you’re going to say “shall not be infringed” doesn’t mean “reasonable restrictions,” right? Crazy talk! That’s crazy talk!

  5. So, no medical services for known libertarians, then?

  6. “IRS chief: Agency lacked sensitivity in screenings”
    Yeah, sensitivity, that’s what was wrong! Not dishonesty, oh no!

  7. IRS Commissioner Douglas Shulman insisted in a 2012 congressional subcommittee hearing that the IRS was in no way singling out groups based on political outlook. We now know that to be false.

    So, perjury charges are forthcoming?

    1. “So, perjury charges are forthcoming?”
      As soon as they find a whipping boy; can’t have a bureaucrat facing punishment.

      1. “The Commissioner based his statements on the best assessment he had at the time.”

  8. Gotta love those bought and paid for politicians.


  9. John Stewart shits a brick


    1. That was a good segment.

      Stewart is generally a liberal shill, but when they do fuck up, he’ll call them on it.

      1. He still downplays Benghazi though, which is annoying.

        1. He just helps to deflect from Monica .. oopss Weiner’s weiner .. ooops Benghazi..

  10. Goddam I wish more Americans would realize that fucking income taxes – and by extension, IRS – is evil and in no way should be tolerated in a free society. Instead of carving out exceptions to civil rights in order to properly administer the income tax laws, we should be carving out exceptions to the list of acceptable types of taxes in light of sacrosanct and immutable civil rights.

    So many people just act like it’s just a law of the universe to pay income taxes and be harassed by the government.

    Similarly, I wish people would be less scandalized that an authoritarian agency acted in a tyrannical partisan manner and just be scandalized that such an authoritarian agency exists at all.

    1. FairTax.org gives everyone freedom and only folks who sell new stuff will have minimal oversight.

  11. I’m sure all this hub-bub about the IRS is overblown. They can be trusted with our sensitive medical records. They’re the government, for goodness sakes! They have to be merely diligent, disinterested agents working to improve the lives of Americans and to faithfully execute their charter.

    1. They’re UNION employees.. Why the heck have the civil service?

  12. “A little overweight? High cholesterol? Eat red meat? Not enough veggies? Don’t exercise enough? Too much salt? Too much sugar? Drive one of them gas guzzling big, fast cars? Have a gun in your house? Read some of those “controversial” news sites?

    Those are all pretty risky behaviors there, Mr. Taxpayer. Until you fix those problems your taxes will be going up and you won’t be able to see a doctor for that heart problem. See you in 6 months.”

    … says the IRS agent reviewing your tax return.

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