As soon as I saw the headlines 'IRS apologizes for targeting conservative groups' I knew we were going to be in GOP outrage mode once again, with the calls of tyranny and claims of chilling of free speech and intimidation. The horror of targeting groups simply because they have 'tea party' or 'patriot' in their names! At long last, President Obama, have you no decency?

But...

The truth is that there was really no need for the IRS to apologize for investigating these groups. In fact, as even young Ezra admits, the IRS should be investigating even more of these groups who claim to be non-profit (though he carefully couches it through the outrage meme of the moment):

If it discriminated against tea party groups that attempted to register as 501(c)4 social welfare organizations, then that’s a grave offense, and it needs to be investigated thoroughly and dealt with severely.

But the particular bias people are angry about is the opposite of the bias they should be angry about. The problem wasn’t that the IRS was skeptical of tea party groups registering as 501(c)4s. It’s that it hasn’t been skeptical of Organizing for America, Crossroads GPS, Priorities USA and Heritage Action Fund registering as 501(c)4s. The IRS should be treating all these groups equally and appropriately — which would mean much more harshly.

Instead, the IRS has permitted 501(c)4s to grow into something monstrous. And if they cower in the aftermath of this embarrassment, it might make matters even worse.

Ignoring for the moment that groups have been targetted in the past with nary the pearl clutch from either party or mention of impeachment, it was entirely appropriate for the IRS to look into these groups.

Tea party groups are inherently political in nature. They were founded as a political response and focused on making political impact via political activities. By all rights, they should have been formed as 527 organizations, which are described by the IRS as follows:

Political organizations include parties, committees, associations, funds or other entities
organized and operated “primarily for the purpose of directly or indirectly accepting contributions or
making expenditures.” Political organizations accept contributions and make expenditures for the
purpose of influencing the “selection, nomination, election, or appointment of any individual to
Federal, State, or local public office or office in a political organization, or the election of
Presidential electors.” Political organizations include political party committees, Federal, State and
local candidate committees and other political committees such as political action committees
(PACs).

Instead, the investigated groups were formed as 501(c)4s, which is a nifty little manipulation of the tax laws to prevent disclosure of their donors:

Social welfare nonprofits don’t fall under the Federal Election Commission’s standard definition of a political committee, which, under FEC guidelines, must disclose its donors. Because 501(c)(4)s say their primary purpose is social welfare, they can keep their donors secret. The only exception is if someone gives them money and specifically states the funds are for a political ad.

And unlike political committees, social welfare nonprofits have a legal right to keep their donors secret. That stems from the landmark 1958 Supreme Court case, NAACP v. Alabama, which held the NAACP didn’t have to identify its members because disclosure could lead to harassment.

Fast forward to the post-Citizens United world of campaign finance where outside groups can now spend unlimited amounts of money to influence elections so long as they are independent of candidates. Seeing the advantages offered by groups that can engage in political activity while keeping their donors secret, both Democrats and Republicans have seized onto this opening in the tax code.

That’s why in recent years, many new 501(c)(4)s have popped up right before the election season, focusing heavily on television advertising, usually attacking, though sometimes promoting, candidates running for office.

These nonprofits do have to report some of their activities to the FEC. When they run ads directly advocating for the election or defeat of a candidate, they have to tell regulators how much and what they spend money on — but not where the money comes from.

(c)4s were designed to be for charities, not political organizations. It is entirely legitimate to investigate whether these groups were not manipulating the tax code. There was no need to apologize. In fact, as young Ezra says, we should be expanding the investigations, making the IRS actually put some teeth into these designations, and looking at other organizations (may I suggest Michelle Rhee's StudentsFirst?). And while we're at it, maybe the IRS should take a closer look at politicking by churches as well.

But there's a reason that the conservatives are up in arms and crying foul: they're gaming the system. They've learned that loud, blustery yelling puts these essentially apolitical bureaucrats on the defensive (see the Dept. of Agriculture, Shirley Sherrod, NASA's Muslim outreach, President Obama's trip to India, ACORN, et al.). They know that these career civil servants will bend over backwards to not appear partisan and back off.

And that's what they're counting on. There is nothing at all wrong about investigating tea party organizations formed as 501(c)4s. But by suggesting a political targeting, these groups have ensured that their millions of dollars of astroturfed funding and donors will NEVER be checked as they little by little attempt to steal democracy away from the rest of us.