American Thinker: Could this be the biggest Obama administration scandal of all?


One lesson that Watergate teaches us is that nothing says “scandal” better than prison sentences. And prison sentences are on the table in a long-developing scandal involving the IRS, but apparently not Lois Lerner.  In the words of John Hinderaker of Powerline, “…there is strong reason to believe that one or more White House political appointees have illegally accessed private taxpayer information and used it for political gain.”

This is a serious crime, punishable with serious prison sentences. Bad though the abuses of the IRS tax-exempt section may be, they pale in comparison with the exploitation of confidential taxpayer information for political purposes. Hinderaker does an excellent job of covering a lot of ground and explaining the latest developments that could explode in the face of the Obama administration, so I recommend you read his article here. However, in sum, the incident started when:

[Chairman of Obama’s Council of Economic Advisers Austan] Goolsbee conducted a telephone press briefing in which, according to the Washington Post, he purported to reveal confidential taxpayer information:

So in this country we have partnerships, we have S corps, we have LLCs, we have a series of entities that do not pay corporate income tax. Some of which are really giant firms, you know Koch Industries is a multibillion dollar businesses. So that creates a narrower base because we’ve literally got something like 50 percent of the business income in the U.S. is going to businesses that don’t pay any corporate income tax.

There are three possibilities here: either Goolsbee just made up the claim that Koch Industries doesn’t pay corporate income taxes; or he learned Koch’s tax status from some proper, legal source; or else he illegally accessed Koch’s tax returns and used the information he learned for political purposes in a call with reporters.

Koch Industries is a privately-held corporation, one with 50 or fewer shareholders, and that means it does not publicly report its income. Very few large companies enjoy the substantial advantages of remaining private (the other notable example is Cargill, the grain trading and logistics giant), a status that not only enables them to keep competitors in the dark, it also enables them to escape the tyranny of quarterly earnings reports, and therefore plan and execute long term strategies that may involve temporary earnings declines in order to invest and grow promising businesses. The stunning growth of Koch Industries is an excellent indicator of the wisdom of remaining private, assuming capable management is in place. (Cargill is no slouch, either).

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