Question for Ron Fournier

Now that you’ve suddenly noticed that Rep. Issa is telling lies about the IRS scandalette, why not consider the probability that he’s doing so because there’s no actual scandal there, any more than there is in Benghazi!? And why not at least raise the question of the culpability of the Speaker and the rest of the Republican majority in the House for putting this minor-league McCarthy in charge of government oversight? He keeps his microphone at the pleasure of his colleagues, and they should be held accountable for allowing him to do their dirty work.

Fournier’s hackishness is actually clearer in this story than it is in his usual Republican-slanted ones. His objection to Issa is not that he’s lying and destroying reputations; it’s that in doing so he might be inadvertently helping the President.

Footnote The real puzzle is why the AP kept Fournier around for so long, and why National Journal picked him up.

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact:

10 thoughts on “Question for Ron Fournier”

  1. I hate it when people capitalize comments for emphasis, but I’m going to do it here:


    An organization applying for a 501(c)(4) determination letter is a 501(c)(4) regardless of whether it receives a determination letter. The principal reason these political entities want a determination letter is that they will be assured that they will not be classified as 527 organizations, a classification that requires that their contributors be publicly disclosed. Stated somewhat differently, these organizations don’t really want to be classified as 501(c)(4)s; rather, they don’t want to classified as 527s. Under these circumstances, the Service was just as justified in increasing scrutiny of applicants for a determination letter as local police are justified in setting up speed-traps in areas where a good number of drivers have been regularly found to be dangerously exceeding the speed limit.

    1. I wonder. If any of the aggrieved groups sues, will discovery flush out the identity of its contributors?

      Or is there no there, there?

    2. In order to say that, you have to define “damage” remarkably narrowly.

      You have to exclude compliance costs. Which have been massive in some cases.

      You have to exclude not being able to tell people you have the approval.

      You have to exclude having to save all the funds you’ll owe if eventually refused.

      IOW, it’s simply not true there’s no damage.

        1. It differs in that the IRS has already admitted these costs were improperly imposed, which is what makes them “damages”, not just “costs”?

      1. I suspect that compliance costs were fairly nominal. I’ve put together 501(c)(3)’s which are more difficult than 501(c)(4)s and, excluding the preparation and filing costs for the articles of incorporation, bylaws, etc., that have to be prepared in any event, the cost is less than $5,000.00. Looking at the groups that submitted written testimony today, with the exception of the National Organization for Marriage, which is extraordinarily well-funded, it appears that most of the organizations making submissions were do-it-yourself jobs with little or no professional fees involved. (BTW, NOM does not contend that it had a problem getting a 501(c)(4) determination letter. It contends only that someone inside the IRS leaked its Form 990. Since these returns are not submitted to the same operational group as the one which issues the determination letters, it is likely that this issue is totally unrelated to the current investigation.)

        The only reason you would want to tell people that you were “approved” is that they may be concerned that the organization is a 527 organization and that their identities might be disclosed. That, of course, only illustrates the point that I am making. That is, the growth in the use of 501(c)(4) is only a way to attempt to dodge the disclosure requirements of 527.

        Finally, the “exclusion” argument really does not fly. If you don’t have a determination letter, you can still file a form 990. It is highly unlikely that you will ever be audited. If you are, it is unlikely that the contributions constitute income. If you are audited and the contributions are deemed to be income, merely close down the operation–there will be no personal liability.

        1. The compliance costs are fairly nominal when the IRS is not behaving abusively. Unfortunately, they WERE behaving abusively in this case, making absurd and sometimes illegal demands for documentation, and managed to impose enormous compliance costs on these organizations, to the point that some of them simply folded.

          It’s no use comparing this to normal IRS enforcement actions, they’ve already admitted that what these organizations were put through was a lot more rigorous, illegally so, than the usual procedure.

  2. In mid 1990s I presided at a 501(c)(3) during the application/trial period. We provided therapeutic horseback riding for disabled individuals.

    During the first meeting with our advisor we were told that we could expect close scrutiny due to the horse involvement. It seems to be not uncommon for private riding clubs to try to claim non-profit status as educational institutions because they give riding lessons. Such a status would allow members to claim deductions for contributions to pay for land, stable, indoor riding arena, upkeep, maybe even individual horse expenses. Kind of like a country club claiming to be a charity because they have golf lessons. Soooo ALL groups with horses get the flashlight up the butt treatment.

    This seemed reasonable to me as non-profit status is a privilege and it is always the obligation of anyone asking for privileged status to prove they merit the privilege. Our program was (and is tody) squeaky clean and so we were granted permanent status.

    @Stuart Levine: Exactly right. The non-profit status starts imediately and continues until further notice. And the privileges are not rescinded retroactively so I assume the donors will retain their confidentiality for any contributions made before the status is withdrawn.

    1. There might be a chance, if the IRS found that a particular organization claiming tax exemption was fully aware they didn’t qualify, and proceeded in bad faith, that they would come after the donors. Not so much for the disclosure as for the tax evasion.

      That’s the other thing to remember about this: all of us ordinary taxpayers are effectively subsidizing anonymous rich people’s and corporations’ political speech at 35 cent on the dollar.

  3. Thank you. My only regret is that your observations about Fournier are not more widely reported obvious as they are. It would be nice, for example, to see them as an op-ed in the NYT. I can’t help but wonder whether Fournier is the world’s best example of vocational entrapment or merely represents the median level of functioning of the nation’s mediocre press. IMO more likely the latter

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