The Intimidation Game (15 page)

Mitchell was one of the first to expose the Cincinnati scam, when she supplied to a reporter the letter she'd penned to the IRS back in October 2011—the one in which she'd asked the Cincinnati agent to forward the correspondence to the “task force” in Washington he'd mentioned. Mitchell's information ended up on the front page of the
Washington Post
five days after Lerner's Cincinnati lie.

A favorite Democratic way of undermining the probe was to claim that Republicans who wanted answers were engaged in partisan politics. Starting about the time of his Crowley interview, Cummings rarely referred to the IRS investigation without including the words “witch hunt.” Liberal groups and media outlets picked up the cry, arguing that the GOP was belaboring the probe (now a whole month old) in order to gain political advantage in the next election.

The White House also took up the line, if more subtly and slowly. Obama got the ball rolling at the end of July. At an economic address at Knox College in Illinois, he accused the GOP of engaging in an “endless parade of distractions, political posturing, and phony scandals.” Obama didn't specify what scandal he meant, but it was a clear reference to the tax agency uproar. Fox's Chris Wallace clarified it a few days later, asking Treasury Secretary Jack Lew if he thought the IRS targeting was just a “phony scandal.” Lew's response: “There's no evidence of any political decision maker who was involved in any of those decisions. And I think the attempt to try to keep finding that evidence is creating the kind of sense of a phony scandal that was being referred to there.” So, yes, the president was saying—two months after the news broke—that the whole IRS thing was just a “phony scandal.”

December came, and Obama decided enough time had passed to mark the entire affair down to a government bumble. “If…you've got an office in Cincinnati, in the IRS office that—I think, for bureaucratic reasons—is trying to streamline what is a difficult law to interpret about whether a nonprofit is actually a political organization, deserves a tax-exempt agency. And they've got a list, and suddenly everybody's outraged,” he told MSNBC host Chris Matthews. Obama's own initial outrage was clearly gone. He'd moved on to trying to reset the entire debate. His interview words suggested it was the IRS's job to weed politics out of nonprofits—which simply isn't true. And he suggested that the problem was a confusing law. In fact nothing had changed about the law in 2010; the provision governing nonprofits had been easily and fairly enforced for fifty years. The only thing that had changed was a new administration, with a new view of the role of the IRS.

Obama would in later years go much further, telling Fox's Bill O'Reilly that there was “not even a smidgeon of corruption” in the events at the IRS. Rather, said the president, the only problems were some “bone-headed decisions.”

The entire White House mobilized against the congressional probes. White House counsel Kathryn Ruemmler in November 2013 flat-out refused to assist Jordan and Issa in questions they had about the White House's interaction with the IRS. Specifically, the White House wouldn't let the committee interview Jennifer O'Connor, who had worked as the top lawyer to the IRS commissioner, and had helped lead the agency's response to congressional hearings. The committee ultimately had to subpoena O'Connor (who'd been promoted to a deputy White House counsel), and she stonewalled her way through a hearing.

Obama's other clever stall strategy: that Justice Department “investigation.” The probe was never real, but it allowed the White House to claim that something was being done, and to later declare that no crime had taken place.

Jordan grew worried about that probe early on, when FBI director Robert Mueller appeared before Congress. Mueller was flummoxed by even the most straightforward questions about the status of his so-called investigation. He didn't know how many people had been interviewed. He didn't know how many agents were working the case. He didn't know who was the lead investigator. He admitted he hadn't even been briefed on the status of an investigation into one of the biggest scandals in Washington. “Mueller's reaction; that set the tone,” says Jordan. “It was pretty clear there'd be no help there.”

Issa and Jordan would twice in 2013 write to the new FBI director, James Comey, for updates. The law enforcement agency steadfastly refused to give information, steadfastly refused to brief Congress, steadfastly made clear that it had little or no interest in pursuing the subject. Mueller's confusion notwithstanding, the committee found out that the lead investigator was Barbara Bosserman, an Obama donor and DOJ civil rights attorney.

Mitchell vividly remembers her own interaction with Justice “investigators” as one of the more “bizarre” conversations of her life. In February 2014, Mitchell testified in front of Congress, blasting the Justice Department probe as a “sham” and a “nonexistent investigation.” Her proof was that eight months into the probe not one of her clients had been interviewed. Not a single one of Sekulow's had been interviewed either. South Carolina's Trey Gowdy, a former federal prosecutor who knows something about conducting investigations, asked at the hearing how it was that the president could declare that there had been not a smidgeon of corruption when the FBI had yet to even interview anyone targeted.

Just a few days later, Mitchell got a call from an FBI agent inviting her and Engelbrecht in for an interview. “I remember saying, ‘Gee, it's been a while. I've been wondering where you are. You are probably aware that I was recently a bit critical that it had taken you so long to consider my clients.' And he admitted, ‘Yes we are aware,'” says Mitchell. The attorney decided to attend that first meeting on her own. Bosserman was present, and Mitchell remembers that she said almost nothing the entire time Mitchell spoke. Only when Mitchell started talking about the national conference calls conservative groups had arranged right after the first letters hit did Bosserman pipe up. “She suddenly looks up and says, ‘Were there any progressive groups on that call?' And I said, ‘Why on earth would there have been any progressive groups on that call? Nothing happened to progressive groups!' What the hell kind of question is that?”

By early 2014, the administration had already leaked to the
Wall Street Journal
that the FBI planned no prosecutions in the probe. To this day, Congress has never received information about the administration's “investigation” into the IRS scandal. Jordan believes this to be as big a threat to the freedom of the country as the targeting itself. “When you have a Justice Department more focused on politics than justice, the country is in trouble. And there is no denying that is where we are.”

Nobody knew nothing. The IRS was a stone wall from the moment Congress started its inquiry.

Doug Shulman, who'd been commissioner until the end of 2012, declared after the scandal broke that he didn't “accept responsibility.” He'd known about the backlog, known the IRS had asked for donor information, and yet had never informed Congress.

Jonathan Davis, chief of staff to Shulman, would tell investigators that he didn't really have “a background in tax law” and so it just wasn't “something I was involved with.” At one point in the questioning, Davis was asked if there was anything he might have done to prevent this issue from happening. He responded, “I would leave that to the people who know a lot more about this than I do.” To which the congressional questioner responded, “Sir, you were the chief of staff to the Commissioner of the IRS.”

Steven Miller, deputy commissioner throughout much of the targeting, and the man who replaced Shulman, at one point considered whether he should use an upcoming hearing in 2012 to tell Congress what was going on. He decided against it. He sat on the information for another year, and then helped craft the strategy for Lerner's apology. Yet he too now claimed he didn't really understand that this was “targeting.”

Nikole Flax, Miller's chief of staff, used the TIGTA investigation as her own excuse for why she felt her boss shouldn't tell Congress anything.

Then there is the elusive William Wilkins, a man who has always deserved far more attention in this scandal. The IRS—to keep up the façade that it is a “neutral” agency—has only two political appointees. One is the commissioner, the other the chief counsel. Wilkins was appointed by Obama in 2009. He'd been a counsel for the Democratic Senate Finance Committee, and then a registered lobbyist at a left-leaning law firm, WilmerHale, from which he donated to Democratic candidates. He also had another close tie to Obama: He'd led the defense team for Reverend Jeremiah Wright's Trinity United Church of Christ in Chicago when it was under investigation by (as it happens) the IRS.

Wilkins's IRS office oversaw the review of test applications in 2011, and the guide sheet that screeners received in 2012 that led to all the interrogatories. Put another way, this was a Democratic appointee's office that was filtering conservative applications. Wilkins would claim in an interview that while he was aware of “complaints” about targeting, he didn't really know what had happened until he read the TIGTA report. That was one of his more fulsome answers. Wilkins would instead recite the phrase “I don't recall” more than eighty times during his congressional interview.

To this day, we still have no evidence if the White House was directly involved in the IRS scandal. But the closest link that exists is Wilkins. The Obama appointee was at the IRS from the minute it started suppressing, through the dark days of the questionnaires, through the Lerner admission, through the aftermath. Even as every other IRS leadership role changed hands, Wilkins didn't move from his office. He's still there today.

Within days of her admission and apology, Congress had invited Lerner to testify. Investigators had already realized that she was at the epicenter of the story, and Jordan knew she'd made misrepresentations to the committee. Perhaps for that reason, her attorney immediately informed Congress that she intended to assert her Fifth Amendment rights and asked that she be excused from appearing. Issa was having none of it, and compelled her to attend. What followed was a spectacle, as Lerner metaphorically flipped off the nation.

Lerner showed up on May 22 having made clear her intention to assert the Fifth. The committee was ready for it. Lerner instead responded to the committee's first inquiry with a long and combative statement. She recited a potted history of her government tenure and then launched into a defense. “I have not done anything wrong. I have not broken any laws. I have not violated any IRS rules or regulations, and I have not provided false information to this or any other congressional committee.” Only after this monologue did she plead the Fifth, steadfastly refusing to answer dozens of questions.

Republican Trey Gowdy, the former prosecutor, was incensed. “Mr. Issa, Mr. Cummings just said we should run this like a courtroom, and I agree with him. She just testified. She just waived her Fifth Amendment right to privilege. You don't get to tell your side of the story and then not be subjected to a cross-examination. That's not the way it works.” It worked for Lerner. She to this day has never answered a question for Congress. When the Oversight Committee recalled her a year later for another attempt at information, she repeated the same Fifth Amendment response to every question asked.

Lerner only took her right to remain silent so far. Congressional Republicans would later find out that she had agreed to submit to an interview with Justice investigators. She'd agreed to do this in the context of a “criminal” probe. She'd even agreed to it with no offer of legal immunity. Lerner clearly knew she had nothing to fear from the feds. She also talked to friendly media.

Lerner's congressional performance was so outrageous that the IRS could no longer pretend she wasn't a problem. It asked her to resign. In yet one more brassy move, she refused, forcing the agency to instead place her on “administrative leave.” In the regular world—outside of the federal government—this is known as paid vacation. When a review board prepared to recommend that she be removed from her position, the Obama higher-ups instead allowed her to retire with full pension and benefits.

Steven Miller was booted as IRS commissioner within a few days of Lerner's apology, and Obama tapped Danny Werfel to run the IRS on an interim basis. Werfel was serving as controller of the Office of Management and Budget, and had never worked at the IRS. But what made him attractive to the administration was that few Americans had heard of him, and to the extent they had, it was in the context of eye-glazing news stories about budgets. This allowed the Obama team to pass him off as a wonky nonpartisan, even as it installed one of its own (along with Wilkins) at the top of the agency.

Werfel immediately promised his full cooperation. His actual idea of working with Congress was noncooperation with a smile. Investigators had at the very start requested that the IRS provide them documents related to eighty-one different search terms. Mr. Werfel's team unilaterally chose to cut that to twelve, explaining that most of the terms (including vital ones such as “c3”) were too “generic.” The IRS kept ratcheting down the number of documents it claimed it needed to turn over. And it sat on even those documents it did admit it needed to provide, offering endless inane excuses (at one point claiming to be unable for weeks to get into a password-protected disk). Two months into the investigation, the IRS had turned over just 3 percent of the required documents, derailing congressional efforts to prepare for witness interviews.

But if Werfel was the partisan heading up the stonewall for the administration, his successor was something worse. John Koskinen, nominated in August, was so convincing in his initial vow to kick IRS ass and take names that it would be another six months before Congress realized he was fully on board with the broader Obama cover-up.