Thursday, July 4, 2013

IRS and NSA Controversies

In recent months, the Obama administration has been plagued by several serious controversies, chief among them:
  • Charges of political profiling by the Internal Revenue Service (IRS) in delaying the approval of tax exemption under § 501 (c)(4) to some "patriotic" organizations, and

  • Large-scale domestic snooping by the National Security Agency (NSA) according to Top Secret documents leaked by Edward Snowden.
You may download my PowerPoint presentation (Philosophy Club, The Villages, FL, 5 July 2013) here: https://sites.google.com/site/bigira/philosophy-related-pps/Philo%20IRS%20NSA%20July%202013.pptx?attredirects=0&d=1

IRS POLITICAL PROFILING CONTROVERSY

According to the May 2013 report by the US Treasury Department Inspector General (IG) for Tax Administration (.pdf available here: http://www.washingtonpost.com/blogs/wonkblog/files/2013/05/201310053fr-revised-redacted-1.pdf ), starting in 2010 and continuing through 2012 and two election cycles, "inappropriate criteria were used to identify tax-exempt applications for review".

The IG Report identified some specific inappropriate criteria including "Patriots", "Tea Party", "Issues include government spending, government debt or taxes", "Education of the public by advocacy/lobbying 'to make America a better place to live'", and "Statement in the case file criticize how the country is being run". [exact quotes, including grammatical errors]

The result was that some applications submitted by Liberal groups were approved for § 501 (c)(4) while otherwise identical applications by Conservative groups were forwarded to a team of "specialists" and thus delayed for years.

According to the IG Report:
Organizations that applied for tax-exempt status and had their applications forwarded to the team
of specialists experienced substantial delays. As of December 17, 2012, many organizations had
not received an approval or denial letter for more than two years
after they submitted their

applications. Some cases have been open during two election cycles (2010 and 2012). [my bold]

On 13 May 2013, a day before the IG Report was issued, President Obama stated that the practice was "Outrageous, if true."

The next day, when it was clear that the charges were indeed true, Obama followed up stating:
"The IRS must apply the law in a fair and impartial way, and its employees must act with utmost integrity.
“This report shows that some [IRS] employees failed that test. I’ve directed Secretary Lew to hold those responsible for these failures accountable, … so that such conduct never happens again.
“But regardless of how this conduct was allowed to take place, the bottom line is, it was wrong."
The IG Report included a detailed list of some of the "unnecessary" questions asked of targeted organizations by the "specialists" to delay approval.
1 Requests the names of donors. 2 Requests a list of all issues that are important to the organization and asks that the organization indicate its position regarding such issues. 3 Requests 1) the roles and activities of the audience and participants other than members in the activity and 2) the type of conversations and discussions members and participants had during the activity. 4 Asks whether the officer, director, etc., has run or will run for public office. 5 Requests the political affiliation of the officer, director, speakers, candidates supported, etc., or otherwise refers to the relationship with identified political party–related organizations. 6 Requests information regarding employment, other than for the organization, including hours worked. 7 Requests information regarding activities of another organization – not just the relationship of the other organization to the applicant.
Were "Progressive" Organizations also Targeted?

The Democrats on the House Ways and Means Committee published what they said was evidence that "progressive" groups were also targeted (.pdf available here: http://democrats.waysandmeans.house.gov/sites/democrats.waysandmeans.house.gov/files/November%202010%20BOLO%20IRS0000001349-IRS0000001364.pdf).

Indeed, the term "Progressive" does appear on a spreadsheet utilized by the IRS reviewers, however, that line of the spreadsheet applies only to § 501 (c)(3) applications, which are very different from the 501 (c)(4) applications that are the main object of the IRS political profiling controversy.

As the IG Report makes clear, § 501 (c)(3) organizations may NOT "engage in political campaign intervention" while § 501 (c)(4) groups may do so up to 40% of their activities. Another difference is that contributions to § 501 (c)(3) groups ARE tax deductible by the donors while § 501 (c)(4) are NOT tax deductible by the donors.

The House Ways and Means Democrats include one example of a "Tea Party" group that appears on an IRS spreadsheet, but careful observation shows that that line applies to BOTH § 501 (c)(3) and § 501 (c)(4) groups. It should be obvious that tax exemption should not be allowed for donors for any "political campaign intervention", whether Liberal or Conservative.

Thus, there is no evidence that "Progressive" groups were subjected to any profiling related to § 501 (c)(4), while it is clear, even from the IRS spreadsheet example published by the Democrats, that such profiling was inappropriately applied to Conservative groups.

Should ANY "Political" Organizations Enjoy BOTH Tax-Exemption AND Anonymity for their Donors?

In reviewing this controversy, I wondered why the IRS allows MAJOR DONORS to make ANONYMOUS contributions to ANY tax-exempt organization that engages in any form of "political campaign intervention" (be it Liberal or Conservative) .

Well, it turns out that this strange rule dates from the 1958 Supreme Court decision regarding the NAACP vs Alabama (see http://en.wikipedia.org/wiki/NAACP_v._Alabama) where the Supremes ruled that disclosure of names could render private donors vulnerable to retaliation.

OK, if that is the Law of the Land, so be it, but it should be applied EQUALLY to both Liberal and Conservative groups. Don't you think?

In this case, IRS political profiling, targeting Conservative groups, over two election cycles (2010 and 2012), has almost certainly resulted in a net benefit for Liberal organizations in terms of fund-raising, because some donors will justifiably hesitate to contribute to any organization that has not been approved by the IRS for tax-exempt status.

Has this affected election results at the National level (House, Senate, Presidency), and/or local levels (Governors, State Legislators, etc.)? No one will ever know for sure, but I would think at least some close elections could have gone the other way absent IRS targeting of Conservative "political campaign intervention" groups.

NSA SNOOPING CONTROVERSY

Which brings us to the second part of this (admittedly long) topic posting.

The reason I have linked the IRS and NSA controversies should be painfully obvious:

If any Administration, whether Democrat or Republican, misuses an agency of the government for political profiling purposes, as the Democrats have clearly misused the IRS for two election cycles, how can we trust them not to similarly misuse the awesome snooping powers we now know have been entrusted to the NSA ?

We all know that Edward Snowden, an employee of an NSA contractor, went to Hong Kong (controlled by China) and released several TOP SECRET documents revealing that the NSA has engaged in large-scale domestic snooping. There is no doubt that all TOP SECRET materials contained on the laptop computers and other computer media he had with him have been downloaded by the Chinese and are now in their possession. Snowden subsequently went to Russia, and has been there long enough for the Russians to have downloaded all material he had with him. Also, there is no doubt that both the Chinese and Russians have interrogated Snowden thoroughly and extracted the critical TOP SECRET NSA information that he possessed.  

After the NSA leak was made public by Snowden, President Obama assured the American public:
“… nobody is listening to your telephone calls… 
“… you can't have 100 percent security, and also then have 100 percent privacy and zero inconvenience. We're going to have to make some choices as a society… 
"I don't welcome leaks … There's a reason these programs are classified." [my bold and italic]

Please note that I have bolded the President's word "Nobody". Does that mean no person is listening to our telephone calls (and that no person is reading our emails and other computer communications)?


For example, what if some automatic computer program was listening to our telephone calls (and emails) and searching for some combinations of words that might indicate criminal or terroristic intent? And, only if and when the computer program discovered some suspicious messages and identified the people involved, then the NSA went to the FISA court to get a warrant to have some person listen to phone calls (and emails) to and from the identified persons?

I have also bolded and italicized the word "is". As President Bill Clinton famously observed, "It depends upon what the meaning of the word 'is' is."

Is Obama assuring us that nobody is listening to our phone calls (and emails) right now? What if our phone calls (and emails) are being automatically recorded and stored away by the NSA for future use if and when subsequent analysis reveals that they may relate to suspicious activities and then the NSA gets a FISA warrant to have some person listen to them?

That said, I agree with Obama that we cannot expect "100 percent privacy and zero inconvenience" and maintain reasonable security against criminal and terrorist attacks. Like him, given this difficult choice, I come down on the side of security.

What do we know about NSA snooping?

Started as early as 2006 (under G.W. Bush), continued through present (2008-2013 under Obama).

Key members of Senate and Congress are aware of classified details of NSA programs and exercise oversight. Judicial oversight is exercised by FISA court.

MetaData is being collected on virtually ALL domestic home phone and cellphone calls (at least the Calling number, Called number, Date, Time, Duration, …) Internet data (VoIP, Emails, Chat, Photos, Videos, Files, Stored Data [“cloud”], Logins, SPECIAL REQUESTS, …)

What do I suspect about NSA snooping?

I’ve worked on classified military projects, but never NSA projects or any projects related to surveillance or data mining, so I am free to “speculate” without revealing classified information.

Based on my knowledge of electronics and computers and the Internet and “artificial intelligence” I never type anything into my computer that I would not mind seeing on the front page of tomorrow’s newspaper or TV news!

For many years I have suspected that NSA (not to mention Google :^) has metadata on all Internet activity and phone calls and that they utilize advanced data mining algorithms to associate Phone numbers, Email addresses, Blogs, Social networks, and so on.

It is also likely they use “artificial intelligence” and “key word analysis” computer techniques to “gist” voice phone calls, looking for languages and word combinations that may indicate criminal or terrorist activities as well as semantic analysis to identify individual writing styles. It is also likely they similarly “gist” Emails, Blogs, Photos and other Internet data and use facial recognition, voice prints, and other biometrics to associate multi-modal communications with particular groups of people and individuals.

Bottom Line

I (along with Obama) am appalled that Edward Snowden violated his pledge to protect classified government documents. Internal government processes (and specialized lawyers) exist for reporting abuses. Snowden should have used these before going to China and before revealing these Top Secret activities to the press. (Hong Kong is an “autonomous” region under the control of China.) We should assume China and Russia have all Snowden’s NSA data.

I generally SUPPORT all the known and most of my suspected NSA snooping activities, assuming proper oversight. As I’ve stated in presentations to The Villages Philosophy Club and my Novel and Blogs, advocates of “privacy” are fighting a phony and lost battle. If you have a home and a job and a credit card and a cellphone and a car – in other words if you are a “respectable” citizen – YOU HAVE NO “PRIVACY”. (The only person with real privacy is the guy using your stolen credit card to buy stuff!)

However, the IRS scandal has increased my distrust of the government. I worry that POLITICALLY-motivated NSA employees may abuse Phone and Internet data for partisan purposes (as some IRS employees have done).

Get the PowerPoint Presentation!

If you'd like more technical background on the "six degrees of separation" between (virtually) any two people on Earth and on the issue of privacy in the Internet age, please download the PowerPoint presentation I gave to the Philosophy Club of The Villages, FL.

Please download that PowerPoint here: https://sites.google.com/site/bigira/philosophy-related-pps/Philo%20IRS%20NSA%20July%202013.pptx?attredirects=0&d=1,

Feel free to express your opinions on this issue by posting a Comment to this Blog.


advTHANKSance


Ira Glickstein 




 


2 comments:

Ira Glickstein said...

[from Joe Bakel, posted with his permission]

Thanks for your usual excellent presentation. Interesting discussion.


In reflection I am surprised someone did not bring up the 4th amendment - right of privacy and arbitrary invasion. We seem to have given up our privacy rights to technology without a whimper. I 100% agree - privacy is an illusion, but am very uneasy that our government has taken advantage of it without disclosure and with 'stonewalling' when a leak occurs. Right to remain silent (5th)? In my opinion if we do not have these rights why should the government have the right of confidentiality? This whole thing is a can of worms (and quite possibly total chaos) and perhaps needs to be open to reasoned public debate and Supreme Court review. Hiding under the blanket of unverifiable "national security" may be the road to oppression. "Security" may be as much of an illusion as privacy?

Joe Bakel

Ira Glickstein said...

Joe, thanks for your kind words and your thoughtful comments.

With respect to "privacy" it has, in my opinion, always been an illusion.

Prior to the age of mass society and the advent of massive individual mobility, people tended to live in small towns and in the same neighborhood, even the same houses, for their entire lives and even for multiple generations. Everyone knew everyone else's business, and it was clear to all who was a hard worker and good neighbor, and who was a loafer or drunk or otherwise not trustworthy. So, for settled townsfolk, there was no real privacy at all. When a stranger came to town, he or she was recognized as such and watched closely, so the occasional stranger had no real privacy either.

With the advent of mass society and large towns and cities where there were so many people it was impossible to know and be known by everyone else, we still had neighborhoods and workplaces where settled folks were in a situation similar to a small town - in other words with virtually no real privacy. However, given the greater number of strangers likely to come to the neighborhood from other neighborhoods and other cities, everyone had to lock their doors, put their valuables in armored safes or banks, hire neighborhood watchmen and eventually organized uniformed police, and so on. I guess that gave some people some level of privacy when they ventured outside their neighborhoods and workplaces, but at the cost of greater exposure to crime and the inconvenience of being treated as a stranger.

With the advent of greater mobility provided by improved and less expensive public transportation and, eventually, the family automobile, anonymity and privacy increased a bit, but at the cost of even more crime, the need for and inconvenience of an ID card (government issued social security card, drivers license, credit cards, etc.), and even more separation and isolation. (Who is more isolated and disconnected than a person in a crowded subway train who does not know anyone else there?)

We are now, in my opinion, coming full circle. Technology has the possibility of somewhat bringing back something like the small town society and safety that existed prior to the advent of mass society and great mobility. Given RFID cards, biometrics, GPS location, Google and other instant information sinks that also provide a rapid and convenient source of information about others, they are no longer strangers, no longer anonymous.

We are re-building small town society with associated safety and security, and we are doing it in mass society. Indeed, worldwide instant mass society, where you and I can go almost anywhere on the globe, and, given a valid credit card (eventually secured via strong personal biometrics that positively identify us as being who we claim we are) and be welcomed like old friends. No longer will we be strangers in a strange neighborhood, nor will we have anonymity nor privacy, but we will be more secure and safe from crime than ever before, and enjoy mass mobility as well.

As for oppression by government, those techniques were perfected long ago and way before the advent of computer technology, the Internet, and the NSA. Indeed, it seems to me that, looked at from a worldwide perspective, technology has been used to increase freedom far more than to increase oppression. But, I tend to be an optimist!

Ira