The IRS has rejected the Christian Coalition's 10-year struggle to win tax-exempt status, dealing a major setback to a mainstay of the Republican Party and to the political-business empire that turned broadcaster Pat Robertson into a power broker of the religious right.
The IRS action is virtually certain to make conservative pastors, concerned about risking their charitable status, reluctant to maintain their close ties to the Christian Coalition, and less willing to distribute its controversial voter guides and other material, according to supporters and critics of the coalition.
In the wake of other damaging developments, the IRS ruling, which was first reported yesterday by the St. Petersburg Times, further diminishes the ability of the coalition to maintain its influence in the Republican Party. Over the past 10 years, the Christian Coalition has emerged as the counterpart to organized labor and the women's movement in the Democratic Party.
In states with large evangelical and fundamentalist constituencies, the coalition, the premier organization of the religious right, has helped Republicans at every level of the ballot, playing a crucial role in the GOP takeover of the House and Senate in 1994.
A number of conservatives described the IRS action as a roundhouse punch to a group that is already on the ropes, as its revenue dropped from $26 million in 1996 to $17 million in 1997.
"This will be a surprise to all the people who believed the Christian Coalition was what it said it was, those conservative Christians who thought it was above back-room wheeling and dealing," said Arne Owens, communications director for the coalition until November 1998. "This is the last piece of a puzzle. The Christian right has been potent for a while, but now it's going away," said John Whitehead, president of the Rutherford Institute, a conservative legal group.
The coalition's claim of tax-exempt status while its application was pending eased the concerns of churches over distributing the voter guides and gave the organization the necessary imprimatur of nonpartisanship.
The coalition played down the IRS rejection, announcing yesterday that its board "authorized a sweeping reorganization . . . to accomplish a much more effective and extensive political mission." Noting that the coalition had "withdrawn" its application for tax-exempt status, the release announced formation of a for-profit corporation, Christian Coalition International, that will be free "to endorse political candidates on a state and local level [and] make financial contributions to candidates."
A second organization, Christian Coalition of America, will be created by renaming and relocating a subsidiary, Christian Coalition of Texas. This group "will become the principle vehicle for the operation of the Christian Coalition in the United States," according to the announcement. Spokesman Mike Russell said this new group will do "everything" the old Christian Coalition did.
The conversion of the subsidiary, which has tax-exempt status, into the Christian Coalition of America could provoke retaliatory action by the IRS. "It appears that the new organization will do just what the IRS said disqualified the old organization from getting 501c4 [tax-exempt] status," one tax specialist said.
Barry Lynn, a critic of partisan activity by the religious right and head of Americans United for Separation of Church and State, described the coalition's maneuver as "a shell game in the sleaziest carnival."
Americans United pressed hard for the denial of tax-exempt status, and last year it released a tape of a political speech Robertson gave to Christian Coalition members calling on them to emulate "the Tammany Halls . . . and Chicago machine, and the Byrd machine. . . . This is what we've got to do. Now God has put a mandate on us because the nation is in crisis."
The disclosure of the ruling is the latest in a series of blows to Robertson. Earlier this week, he left the board of Laura Ashley Holdings PLC after gay groups accused him of being a "homophobe" and planned protests. A week ago, the Bank of Scotland scuttled a deal with Robertson Financial Services after Robertson described Scotland as a morally degenerate "dark land" where homosexuals hold disproportionate power.
Last year, Robertson's Christian Broadcasting Network agreed to pay a large fine to the IRS because of CBN's involvement in Robertson's 1988 presidential campaign.