There was a time, really not so long ago, that Tiger Woods was so utterly dominant in golf that any golf tournament he entered would start a discussion on sports talk radio: “Who do you have this weekend? Tiger or the field?” He was playing at such a higher level than any of his competition, that it was seen as a 50/50 proposition that either he would win that weekend, or one of 120+ others would win. 120+ of the best golfers in the world… not chumps from your after work golf league. He was just THAT much better than everyone around.
No one is having this conversation about the current number one ranked golfer in the world, Scottie Scheffler. Everyone would take the field.
Well, in 2019 and prior, we had just as dominant an entity in the US Government. A behemoth SO despised amongst the population that we all bonded in a common hatred of it. No one on the right really liked it. No one on the left really liked it. No one in the middle really liked it. Heck, no one that cared little about politics at all really liked it.
The Internal Revenue Service
If you were to poll Americans before 2019 about which government agency that they disliked or distrusted the most, the IRS would win HANDS DOWN. Nearly every time. It was generally a battle for second place.
Well, things have changed since 2020. The FDA, CDC, EPA, Department of Education, Department Of Labor, Congress, Courts, Presidency, etc have all been really eating into that lead that the IRS had. Not that anyone has fallen in love with the IRS (they haven’t). But, wow, we’ve been paying a lot more attention to the general ineptitude of the others in the past few years. And I think that’s about to change. The IRS is ready for its great comeback.
Thanks to the entirety of the Democratic Party, the IRS is about to add a few more agents. I’m sure you’ve heard the number. Just a tad under 87,000! About double their current size.
YYou have to hand it to the Democratic Party… They truly know what the people want… More Audits!
Well, in their defense(?) they have a base of voters that is obsessed with making people pay their “fair share” of taxes. This makes for a great bumper sticker for people that don't want to think about complex subjects. And this is apparently a core constituency of the democrats. So, under this guise of making people pay their "fair share" they can pass any tax action they want. They just have to sell it as "sticking it to the rich." Whether it actually "sticks it to the rich" or actually sticks it to their own voters is of little concern.
Ask yourself this question… how many of Bernie Sander’s famed “millionaires and billionaires” did you see on the news in the past few weeks decrying how they were being unfairly targeted by this new legislation? Any? Bueller? Bueller?
Yeah, they aren't complaining because they know they'll be able to get around any new "taxes" that are levied against them. And even if they aren't, they know that they will serve to hurt their competition more than they hurt the big guys. It is impressive how easily democrats are hoodwinked! The fact of the matter is the newly hired auditors are going to go primarily after the lower and middle classes. Because they always do. Without fail. And anyone with two brain cells to rub together (and who takes the time to do so) will figure out why.
The middle class and the poor do not have the resources that the “millionaires and billionaires” do. That means they can’t fight back against the IRS effectively when they come knocking at their door. Next thing you know, they’re in no-more-annual-tax-refund city. And catching a bunch of small, easy to catch fish will always be preferable to going after a small number of big, hard to catch fish. Especially when those big fish have high-priced lawyers and accountants protecting them!
So, the IRS is (with twice the work force) going to work its way back up to most hated status. So that’s pretty cool! Nature is healing itself.
And none of this would be possible without the help of Joey Manchin. It’s good to know that he’s just as easily fooled as his democratic constituents (sorry democrats, you brought this on yourself). He attempted to act like the reasonable middleman in the Build Back Better debate, stating that all of this excess government spending during a period of 8-9% inflation was insane. Behind closed doors, he and Chuck Schumer hammered out a deal. They would scale back the Build Back Better plan (turning it into a "Green New Deal Lite") and then supersize the IRS. This was intended to make the bill "budget neutral" or “fully paid for.” Yay, we’re gonna save the planet and get those horrible, no good “millionaires and billionaires” to pay their fair share at the same time!!!
Here’s where it gets fun (well, not for West Virginian’s… but they voted for this boob!). Since the Senate is divided 50-50, they were going to have to pass this bill under reconciliation rules. Basically, under reconciliation, only bills that are directly related to the budget can be passed with a simple majority of votes. So all the Democrats vote for the bill, all the Republicans vote against the bill, and then Kamala Harris breaks the tie in favor of the bill. Easy!
Well, the Senate has a non-partisan parliamentarian that decides what in the proposed bill is and is not allowable under reconciliation rules. Luckily for Manchin, his fellow senator from West Virginia, Shelly Capito, brought up a provision to the bill that would have gutted West Virginia’s coal industry. The provision would have allowed the EPA broad authority to regulate the coal industry in the state. This was deemed to not be directly tied to the budget and was therefore removed from the bill that was voted on.
I suspect, but have no proof, that there was some backroom dealing between Manchin and Capito such that she could save him from this disastrous provision of the law he had solely crafted with Schumer. West Virginia had literally just won a Supreme Court case arguing that the EPA could not unilaterally put in place regulations on the coal industry without explicit congressional authorization (WV vs EPA)… and Manchin very nearly gave them that authorization. Wow!
Seriously, who wants this?
Now we are left with a supersized IRS (and a bill that will do little to help the environment, but plenty to help "green" industries). An IRS that will undoubtedly target the lower and middle classes. It has always been this way, and shall always be this way. Furthermore, it does not seem to be unheard of to suspect that this IRS will target political opponents of the regime. A quick search on the actions of the IRS under Lois Lerner will provide ample evidence on how the IRS can, and is, used to go after politically disfavored groups. Want to question the regime? Enjoy your audit. You’ll learn eventually.
Is there something positive that could arise from this? I hope so. If I were to play it out, here’s what I could see happening in the best case scenario…. Mind you, it doesn’t start out good:
The “Inflation Reduction Act” is signed into law and it is the abomination many on the right suspect it will be. A lot of green boondoggles, incentives that don’t work, continuing inflationary pressures on the economy… and the IRS becomes a de facto agency of the Democratic Party, attempting to punish those that disagree with them using audits. The IRS regains its Tiger Woods-esque dominance in the “most hated federal agency” field. Tax receipts end up coming nowhere near projections that justified the bill as the rich will find ways around and there will be little to squeeze from the lower and middle classes. Furthermore, the ensuing recession (or depression) will severely hamper any taxes that the federal government can collect. Remember, I told you didn’t start out good.
This will enable candidates to successfully run on meaningful tax code change. The current tax code is roughly 7,000 pages and if you include all of the official instructions and guidance, this grows to 70,000+ pages. The IRS will be the opponent of the Republican Party. The IRS will essentially become a proxy opponent standing in for the Democrat Party. This becomes a common enemy that the right and center rally around. Many lower class Democratic voters that want something to rally around yet may distrust politicians that go after the Democrat Party directly will vote for these candidates as well.
With majority power, and a true mandate from the people, the tax code has significant work done to simplify it. Many existing loopholes are closed. We're probably not into flat tax territory, that’s too much to ask for. What we do get is a complete revision of the code and more importantly one that allows the IRS much less audit capacity. The IRS will stay the same overwhelming size as Republicans, like the Democrats, will never vote to cut jobs. But the power of the IRS would be greatly reduced. Meaningful laws would be put in place that would punish those that attempted to abuse the tax system for political purposes.
That’s the best I can see possibly coming from this. But there would be pain getting there.
The bad news is I think it is much more likely that the IRS expansion takes place and there is little done to prevent it from abusing its auditing capabilities. There may be talk of "oversight," but that will amount to little more than senators and congressmen grandstanding while IRS commissioners are brought in front of them for questioning.
Well that was a bummer. I'll try and write something a little shinier and happier next week!