House Committee Holds First Hearing on IRS Scandal

BY Terence Burlij  May 17, 2013 at 9:08 AM EDT

The House Ways and Means Committee will hold the first hearing on the IRS scandal. Watch a live stream of the hearing.

The Morning Line

The former acting commissioner of the Internal Revenue Service, Steven Miller, will take his place in the hot seat Friday morning when the House Ways and Means Committee holds the first hearing on the tax collection agency’s targeting of conservative groups.

Members of the panel are expected to spend hours grilling Miller about the IRS’ practice of zeroing in on groups with the words “Tea Party,” “Patriots” or “9/12″ in their names that had applied for tax-exempt status.

According to the report released Tuesday by the Treasury Department’s inspector general for tax administration, Miller first learned of the additional screening procedures in March 2012 but did not inform lawmakers, despite some having raised concerns that the IRS was singling out conservative groups. The timeline of events, and Miller’s decision to hold back information, will surely draw a good deal of scrutiny from committee members Friday.

The Ways and Means Committee will also hear testimony from J. Russell George, the inspector general for tax administration who conducted the review of the IRS’ practices.

The report found, “The IRS used inappropriate criteria that identified for review Tea Party and other organizations applying for tax-exempt status based upon their names or policy positions instead of indications of potential political campaign interventions.”

The inappropriate criteria remained in place for 18 months, according to the report, and “resulted in substantial delays” in processing the applications of certain groups. However, the audit also found that IRS employees said no parties outside the agency had any influence in developing the practices.

Friday’s session comes exactly one week after the conduct of IRS agents first became public and amid growing demands for answers and accountability across official Washington.

On Thursday, the IRS announced the departure of another top official, Joseph Grant, the commissioner of the agency’s tax-exempt and government entities division. He will retire next month.

Also Thursday, President Barack Obama appointed Daniel Werfel, an official with the Office of Management and Budget, as the new acting commissioner of the IRS to replace Miller.

“Throughout his career working in both Democratic and Republican administrations, Danny has proven an effective leader who serves with professionalism, integrity and skill,” Mr. Obama said in a statement. “The American people deserve to have the utmost confidence and trust in their government, and as we work to get to the bottom of what happened and restore confidence in the IRS, Danny has the experience and management ability necessary to lead the agency at this important time.”

The Washington Post’s Ed O’Keefe and Josh Hicks examine the reaction to Werfel’s selection. Among the new acting commissioner’s supporters is Joshua Bolten, who served as OMB director in the George W. Bush administration.

“I think he’s a smart choice because the IRS is clearly an agency that has been badly mismanaged, with the insertion of extremely inappropriate political considerations and gone badly awry,” Bolten told the Post. “He’s a guy who is a nonpartisan professional who has dealt with tough management situations and should rapidly earn the respect of career folks there.”

Earlier in the day, the president again reiterated his desire to “fully investigate” the IRS’ actions to “make sure that it doesn’t happen again.” Mr. Obama said that could involve looking at “some of the laws that create a bunch of ambiguity in which the IRS may not have enough guidance and not be clear about what exactly they need to be doing and doing it right.”

The president, however, said he did not see the need for a special prosecutor to handle the Justice Department investigation, noting that Attorney General Eric Holder had launched a criminal probe and lawmakers on Capitol Hill were also looking into the matter.

“Between those investigations, I think we’re going to be able to figure out exactly what happened, who was involved, what went wrong, and we’re going to be able to implement steps to fix it,” Mr. Obama said.

Watch the president’s full remarks from Thursday’s news conference here or below:

In addition to Friday’s Ways and Means session, two other committees have scheduled hearings on the IRS next week. That includes a House Oversight and Government Reform Committee meeting next Wednesday, where former IRS Commissioner Doug Shulman, who led the agency during most of the period when the screening practices took place, has agreed to appear. Shulman told lawmakers in March 2012 there was “absolutely no targeting” of conservative groups. His term as commissioner ended in November 2012.

The Huffington Post’s Jon Ward notes that Lois Lerner, who led the IRS unit responsible for overseeing tax-exempt applications, has not yet agreed to testify.

Judy Woodruff reported on Thursday’s developments with the IRS scandal, as well as the administration’s ongoing response to last year’s attacks on U.S. diplomatic facilities in Benghazi, Libya, and the Justice Department’s seizure of Associated Press phone records.

Then she spoke with White House communications director Jennifer Palmieri, who pushed back on those who have criticized Mr. Obama’s response to the IRS situation as too passive.

“I think you always want to respond quickly. And that is your first instinct. But the worst thing you can do is respond … before you have the facts or respond in a way that would get you into more trouble over the long term,” Palmieri said.

Watch Judy’s report and her interview with Palmieri here or below:

REFLECTING ON WATERGATE

Friday night’s NewsHour will deliver a special report looking back at the 40-year anniversary of the Senate Watergate hearings, which launched the birth of a new type of journalism and a partnership between Jim Lehrer and Robert MacNeil.

Jeffrey Brown talked to the NewsHour’s founding fathers about what struck them four decades ago, reprising memorable moments from the hearings that would eventually lead to the resignation of President Richard Nixon.

The piece, produced by Elizabeth Summers, is part of our ongoing coverage this year of the NewsHour’s evolution.

Tune in Friday, or watch the full piece online now. And check out our special Watergate page, which includes Meena Ganesan’s look at where major figures from the Watergate era are today. Ahead of the report, we also asked viewers to share their memories from the summer of 1973. We received hundreds of responses. Here are some of them.

LINE ITEMS

  • There was some good news for Mr. Obama on Thursday. By a vote of 97-0 the Senate confirmed Ernest Moniz as energy secretary.

  • Mr. Obama’s nominee to head the EPA, Gina McCarthy, advanced to consideration by the full Senate after a 10-8 party-line vote in the Environmental and Public Works Committee. Just last week, Republicans had boycotted a vote on McCarthy, but given the close vote in committee, her confirmation is less certain than Moniz’s.

  • And the Senate Judiciary Committee voted unanimously in favor of Sri Srinivasan, Mr. Obama’s nominee to the D.C. Circuit Court of Appeals — a court to which no one has been confirmed since 2006. His confirmation now goes to the full Senate.

  • By a vote of 229-195, the House voted to repeal “Obamacare” Thursday, marking the 37th time it has attempted to repeal the Affordable Care Act or parts of it. While the legislative fate of the repeal bill is certain to hit a dead end in the Senate, the GOP seized the opportunity to revive opposition to the bill.

  • Although specifics remain unknown, a bipartisan group in the House of Representatives reached a tentative deal Thursday night on immigration reform efforts in a “last-ditch effort to save the legislation.”

  • Mr. Obama named a few appointees Thursday night, including the wife of one of his top press aides. Natalie Wyeth Earnest, who is married to deputy press secretary Josh Earnest, was nominated to be assistant secretary for public affairs at the Treasury Department. He also named former Arizona Rep. Gabrielle Giffords as a member of the J. William Fulbright Foreign Scholarship Board.

  • In his first general election ad for the Massachusetts Senate contest, Republican Gabriel Gomez reprises an earlier ad from the primaries, reminding voters he’s a moderate Hispanic, while Democratic Rep. Ed Markey unleashes the first negative ad of the campaign, going after Gomez on gun control.

  • A top Democratic target in 2014, Rep. Michele Bachmann, R-Minn., was out in force Thursday, headlining a rally against IRS treatment of tea party groups and touting the House’s vote to repeal “Obamacare” in a new ad.

  • The Cook Political Report’s Amy Walter looks at Democrats’ political landscape heading into next year’s midterm elections.

  • Maryland Democratic Gov. Martin O’Malley signed into law Thursday strict new gun control measures, but the NRA has promised to challenge the law.

  • Roll Call’s David Drucker interviews Nevada GOP Gov. Brian Sandoval about his views on the health care law and immigration reform. Here is the second part of the interview.

  • The GOP field in Georgia thickens: Former Secretary of State Karen Handel has announced her candidacy for retiring GOP Sen. Saxby Chambliss’ seat just ahead of the state’s GOP convention.

  • The Washington Post provides an update on the FBI’s investigation into who may have smeared Sen. Bob Menendez, D-N.J., with charges of prostitution. Meanwhile, NBC.com’s editor instructed his staff not to pick up the story.

  • Roll Call’s Meredith Shiner has an interesting scoop: A video posted on the Politico website featuring Senate Minority Leader Mitch McConnell’s chief of staff has been taken down after the Kentucky Republican’s office objected to its placement on a page designed to solicit advertisers. The video, posted earlier this week under the “audience” tab of Politico’s advertising page, features Josh Holmes and identifies him with the title: “Chief of Staff, U.S. Sen. Mitch McConnell, KY.” Holmes spends the first half of the video explaining his job, with shots taken inside McConnell’s office, and the second half of the video explaining why he reads Politico. The video ends with the top staffer saying, “I’m Josh Holmes and I’m a Politico.”

  • Welcome back to Washington, Rep. “Mark Sanfrod”! Turns out, writing press releases is no easy walk on the Appalachian Trail.

  • It’s amazing what the Carolinas can do for comebacks. John Edwards has reactivated his law license and is preparing to make public speaking engagements.

NEWSHOUR ROUNDUP

  • For more perspective on how the Obama administration is responding to the series of crises this week, Jeffrey Brown talks with Democrat Tom Perriello, the president of the Center for American Progress Action Fund, and Republican strategist and author Ron Christie, who worked in the George W. Bush White House and on Capitol Hill.

  • After Mr. Obama’s meeting Thursday with Turkish Prime Minister Erdogan, Margaret Warner speaks with Henri Barkey of Lehigh University and Steve Heydemann of the United States Institute of Peace about international efforts to stop the violence in Syria.

  • Ray Suarez reports from Colorado on how evangelical groups are advocating for immigration reform as demographic shifts alter the composition of their parishes.

  • Jeffrey Brown talks with NPR’s Jeffrey Stein to explore the scientific and ethical dimensions of Oregon Health and Science University’s cloning of a human embryo to derive stem cells.

  • Jenny Marder posts Chris Hadfield’s reflections on four months in orbit.

TOP TWEETS

Christina Bellantoni, Meena Ganesan and desk assistant Simone Pathe contributed to this report.

For more political coverage, visit our politics page.

Sign up here to receive the Morning Line in your inbox every morning.

Questions or comments? Email Christina Bellantoni at cbellantoni-at-newshour-dot-org.

Follow the politics team on Twitter: