Acting director of IRS resigns amid furor over targeting of conservative groups

President Obama addressed the IRS controversy Wednesday evening, announcing that the acting commissioner of the IRS has resigned. Obama reiterated that he “would not tolerate this kind of behavior.” (The Washington Post)

President Obama on Wednesday demanded and accepted the resignation of the acting commissioner of the Internal Revenue Service, Steven T. Miller, as part of a multi-pronged effort to quell controversies that threaten to dominate his second term.

The action was Obama’s first substantive step to address a political uproar stemming from the IRS’s disclosure that it had targeted conservative groups seeking tax-exempt status. It capped a day when the White House tried to dampen two other furors that had put Obama on the defensive — the Justice Department’s seizure of Associated Press phone records and the administration’s editing of talking points about the deadly attacks in Benghazi, Libya, last year.

In a brief but fiery evening statement in the East Room of the White House, Obama labeled the IRS’s actions “inexcusable.”

“Americans are right to be angry about it, and I’m angry about it,” he said, adding that he “will not tolerate this kind of behavior in any agency, but especially in the IRS, given the power that it has and the reach that it has.”

The administration also took the extraordinary step of releasing a letter from Treasury Secretary Jack Lew in which he demanded that Miller resign in order “to restore public trust and confidence in the IRS.”

The forceful response underscored just how damaging the IRS scandal and the other issues could become for a second-term president trying to secure an ambitious array of legislative achievements. Obama and his aides have been criticized in recent days by opponents and supporters alike for a slow and seemingly passive response to the controversies.

The White House also released 100 e-mails Wednesday detailing discussions among administration officials on how to respond to the Sept. 11, 2012, attack on a diplomatic facility in Benghazi, Libya. The release of the e-mails was an effort to rebut GOP allegations that the White House had edited talking points about the attack to play down the possibility it was terrorism.

Earlier in the day, the White House signaled that it would support a renewed effort by lawmakers to pass a “media shield law” that gives new protections to journalists facing subpoenas. That followed growing criticism of the Justice Department for obtaining the phone records of Associated Press journalists as part of a national security leak investigation.

Republicans said Obama’s efforts at the IRS did not assuage their concerns.

“More than two years after the problem began, and a year after the IRS told us there was no problem, the president is beginning to take action,” said Senate Minority Leader Mitch McConnell (R-Ky.). “If the president is as concerned about this issue as he claims, he’ll work openly and transparently with Congress to get to the bottom of the scandal — no stonewalling, no half-answers, no withholding of witnesses.”

Testifying before the House Judiciary Committee Wednesday, Attorney General Eric H. Holder Jr. defended his agency’s decision to obtain AP’s phone records and vowed to pursue any criminal wrongdoing by IRS officials.

“The facts will take us wherever they take us,” Holder said, vowing a wide-ranging probe that will not be clouded by partisanship. “This will not be about parties. This will not be about ideological persuasions. Anyone who has broken the law will be held accountable.”

Obama’s statement came a day after a widely anticipated report by the IRS’s watchdog found that the agency used “inappropriate criteria” to screen political advocacy groups seeking tax-exempt status. The unit in charge created a “lookout” list for organizations with key words such as “tea party” or “patriot” in their names, and organizations faced months of delays.

The report by the Treasury inspector general for tax administration said the IRS’s tax-exempt unit was a bureaucratic mess, with some employees ignorant about tax laws, defiant of their supervisors and blind to the appearance of impropriety.

In his remarks, Obama said he would seek to put in place new safeguards to prevent the targeting from happening again and would work closely with a multitude of congressional investigations. He also suggested he might pursue a revamp of the laws governing political advocacy groups so they are less vague and “we can have confidence they are applied in a fair and impartial way.”

The inspector general’s report did not find that IRS employees involved in the screening were motivated by a partisan agenda. It suggested they were trying to come up with a more efficient system for screening applications from political advocacy groups, which have proliferated in recent years.

Miller, the acting IRS commissioner, wasn’t among those employees who participated in the screening, and he is known to be well liked among the agency’s 100,000 employees. The abuses in the tax-exempt unit occurred during the tenure of former commissioner Doug Shulman, a Bush administration appointee.

Still, lawmakers say Miller, among other IRS officials, failed to inform Congress that the IRS was targeting conservative groups despite multiple inquiries from Republican lawmakers.

In an internal message Wednesday, Miller wrote that “this has been an incredibly difficult time for the IRS . . . and and there is a strong and immediate need to restore public trust in the nation’s tax agency.”

Marcus Owens, who headed the tax-exempt organizations division at the IRS from 1990 to 1999, said Miller, a 25-year career employee, was well respected at the agency.

“Steve was a very smart, capable guy,” said Owens, a member of the firm Caplin & Drysdale. Owens added it is not unusual to remove the head of an organization in the wake of a controversy: “You bring in fresh blood, fresh management and start anew.”

The IRS actions are being probed by six congressional committees, and Miller is expected to testify Friday before the House Ways and Means Committee.

Early Wednesday, House Speaker John A. Boehner (R-Ohio) said officials involved potentially should face jail time.

“The IRS admitted to targeting conservatives,” he said. “My question isn’t about who is going to resign. My question is who’s going to jail over this scandal?”

Ellen Nakashima contributed to this report.

Zachary A. Goldfarb is policy editor at The Washington Post.
Juliet Eilperin is a White House correspondent for The Washington Post, covering domestic and foreign policy as well as the culture of 1600 Pennsylvania Avenue. She is the author of two books—one on sharks, and another on Congress, not to be confused with each other—and has worked for the Post since 1998.
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