Notes on a Trumped Up Scandal The IRS fiasco shows that conservatives can be PC too

Democrats can’t say it; Barack Obama can’t say it; and the IRS certainly can’t say it, so here goes: The only real sin the IRS committed in its ostensible targeting of conservatives is the sin of political incorrectness—that is, of not pretending it needed to vet all the new groups that wanted tax-exempt status, even though it mostly just needed to vet right-wing groups.

How do we know this? Because, for one thing, the people submitting the questionable applications were overwhelmingly right-wingers. As others have pointed out, the early Obama era was a boom time for conservative activists, who were forming groups faster than NBC burns through “Today Show” hosts. This coincided with a series of court rulings that made it possible for these groups to claim tax-exempt status without disclosing their donors under section 501c4 of the tax code.1 As a result, there were suddenly way more non-disclosing political groups trying to claim tax-exempt status than there ever had been, and the vast majority were right-leaning. No surprise, then, that the IRS would focus on whether these groups actually qualified for that status—something that was questionable since the law said their primary activity needed to be “social welfare,” not politicking.

But, in fact, the IRS’s great conservative crackdown is even more innocent than that. It turns out that the applications the conservative groups submitted to the IRS—the ones the agency subsequently combed over, provoking nonstop howling—were unnecessary. The IRS doesn’t require so-called 501c4 organizations to apply for tax-exempt status. If anyone wants to start a social welfare group, they can just do it, then submit the corresponding tax return (form 990) at the end of the year. To be sure, the IRS certainly allows groups to apply for tax-exempt status if they want to make their status official. But the application is completely voluntary, making it a strange basis for an alleged witch hunt.

So why would so many Tea Party groups subject themselves to a lengthy and needless application process? Mostly it had to do with anxiety—the fear that they could run afoul of the law once they started raising and spending money. “Our business experience was that we had to pay taxes once there was money coming through here,” says Tom Zawistowski, the recent president of the Ohio Liberty Coalition, which tangled with the IRS over its tax status. “We felt we were under a microscope. … We were on pins and needles at all times.” In other words, the groups submitted their applications because they perceived themselves to be persecuted, not because they actually were.

The more information we learn about these "scandals" the less they seem like scandals.

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