The latest story in the IRS exempt organizations scandal that has Paperwork Reduction Act implications is the release of the list of questions the IRS sent to one applicant allegedly targeted for unusually burdensome scrutiny. While some of these questions are legitimate, others clearly are not.
Category Archives: Treasury
The IRS Exempt Organizations Scandal
Part 2: The unapproved information collection sent to one applicant
On Friday, exempt organizations division chief Lois G. Lerner revealed to an American Bar Association conference that the Internal Revenue Service had targeted certain applicants for exempt status for heightened scrutiny based on their political views. This admission came after IRS Commissioner Doug Shulman testified before Congress in March 2012, “There’s absolutely no targeting” of conservative groups by the IRS. Over the weekend the story has become a major scandal; a Google search for Lerner’s name this morning yielded more than 150,000 hits.
Today we explore an unreported aspect of the case: Can those who were targeted by the IRS obtain any relief through the Paperwork Reduction Act?
Regulation without Enforcement Is No Regulation at All, Part 3:
New York, US, and UK regulators are not on the same page
The Wall Street Journal’s Liz Rappaport, Max Colchester, and Damian Paletta report (subscription) that federal regulators are trying to quickly come up with a unified position with respect to Standard Chartered Plc, the British bank that New York State regulators say engaged in a 10-year long conspiracy to hide transactions with the government of Iran.
The bank denies the charges and has been ordered to appear on August 15 to respond. According to the Journal reporters, the debate seems to be about how much money the bank must pay (and perhaps to whom) to settle the charges, not whether the charges are valid.
Regulation without Enforcement Is No Regulation at All, Part 2:
Standard Chartered plc denies wrongdoing, stock price partially recovers
We posted on August 6 about the order issued to Standard Chartered Bank by the New York State Department of Financial Services, alleging that its US subsidiary had “schemed with the Government of Iran and hid from regulators roughly 60,000 secret transactions, involving at least $250 billion, and reaping SCB hundreds of millions of dollars in fees.” In response, Standard Chartered “strongly rejects the position or the portrayal of facts as set out in the order.”
This statement is reprinted in full below. It contains highly relevant (and highly technical) information that the NYS Department of Financial Services did not mention.
On August 3, 2011, the Department of Health and Human Services published a revised interim final rule defining certain medical services as “preventive services” and specifying which employers would be entitled to utilize a religious objection exemption. The first interim final rule was issued on July 19, 2010.
In the ACA, Congress directed that certain highly charged policy choices be made by career government employees as if they were technical, scientific issues containing no moral content — what we call the scientization of policy. Scientization is popular among both government scientists (they get to set policy based on their personal views) and agency officials (they get to avoid taking responsibility for policy decisions by saying they are just following scientific recommendations). Congress also allowed the Department of Health and Human Services (HHS) to issue these rules in interim final form — that is, without prior publication of a proposed rule. This procedure tends to exacerbate controversy by short-circuiting normal public notice and comment.
The rule includes two provisions that seem assured of being highly controversial. First, it implicitly defines pregnancy as a disease for which the ACA’s “preventive services” mandate applies. Second, it includes a very limited exemption for employers who object to providing these services on moral or religious grounds. This exemption was not included in the 2010 interim final rule.
We’ve published a long series on the controversy over retentions bonuses paid by AIG and other firms. (To see the entire series, search for “The AIG Bonuses” using the Google search utility in the upper right corner.)
There are three general problems with executive pay restrictions. First, pay restrictions have no effect on those who were responsible for decisions that went south if they no longer work for the institutions in question.
Second, when imposed retroactively, pay restrictions impair legal contracts. This is both constitutionally suspect and creates serious economic and financial uncertainty. Markets perform poorly when parties cannot rely on the rule of law–including contract law.
Third, pay restrictions deter the recruitment and retention of the most qualified people. Some will be motivated by nonfinancial considerations such as a sense of duty or public spiritedness. However, these motivations are undermined when the public or its representatives treat them as if they were culpable for the problems they have agreed to serve, often without pay, to correct.
Today’s Wall Street Journal suggests that AIG now faces this government-induced dilemma.