IRS bullies should pick a different sandbox

America's poor have it too darn easy. Rural and inner-city public schools burst with resources and opportunities, while welfare checks and food stamps foot the bill for fur coats, Cadillacs, and lobster dinners. Meanwhile, America's corporations and its rich citizens sally nobly forth in the name of capitalism and hard work, determined to surmount legal barriers and government harassment.

At least, that's what the IRS must have been thinking in 1999, when, for the first time in history, it audited the poor at a higher rate than the rich. In an effort to curb abuse of the Earned Income Tax Credit (EITC)—a policy instituted, ironically, to reward poor Americans for working—the IRS shifted its resources away from middle and upper-class filers and targeted those with nothing left to give. While the average Joe rests easy knowing his chances of being audited are one in 370, those applying for an EITC face five times the likelihood of government harassment.

Apparently unaware of the idiocy of simultaneously punishing and rewarding the working poor, IRS Commissioner Charles O. Rossotti told The New York Times on Fri., Feb. 16 that the IRS's shrinking staff had caused this paradigm shift in the bureaucracy's policy. Desperate to cut financial corners, deprived of the aid of accountants, and suffering from a poor understanding of U.S. tax law, America's poor surely make easy targets for such a potent governmental entity. But a high success rate does not actually translate into increased revenues; Rossotti declines to mention, for instance, that audits of U.S. corporations bring in over nine times as much money as audits of impoverished individual filers. Meanwhile, the corporate audit rate has continued a steady, decade-long decline. Either the IRS has committed an egregious oversight here, or something larger is at work.

That "something" is an increasing governmental tendency to cater to America's rich. Audits of middle-class filers have dropped across the board in the last 10 years, but nowhere nearly as precipitously as they have for the rich, who are now 11 times less likely to be audited. Indeed, the IRS's bias against the poor has been a long time in the making. In the last decade, it has answered to a Federal government that, under both Republican and Democratic leadership, has cut taxes affecting the rich, such as capital gains, and prioritized corporate welfare above welfare for needy children. Of course, Congress recently trimmed and restructured the IRS to kill what had become an unforgiving bully of the average citizen. Sadly, these statistical trends indicate that the bully has merely lost a few pounds and moved to a different playground.

Luckily for President George W. Bush, DC '68, Rossotti, and corporate America, no one seems to have noticed. The booming economy has propped up the IRS's revenues despite its shrinking size, and so its policy changes have caused little more than a blip on the political radar. As a result, Rossotti still has time to make good on his promise of "stabilizing" the distribution of audits before America begins to cry foul. Then again, if he doesn't, it will simply go down in history as another policy decision that invokes efficiency considerations but somehow finds a way to screw the people with the least money and the faintest political voice.

Shiny Cadillacs notwithstanding, the poor actually have it pretty tough, especially now that supporting equality of opportunity is no longer politically fashionable. But if the IRS's recent behavior has ruined or at least shaken a few thousand lives, it can nonetheless provide an object lesson for a White House looking to scrape together votes while cutting fiscal corners. Even in his effort to cut so-called extraneous social services and slash trillions of dollars from our national deficit, Bush can give America's working poor one benefit that won't cost him, or the IRS, a dime—respect.

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