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June 03, 2013

The IRS scandal as an example of runaway organizational culture

Organizations large and small develop unique cultures over time. You see this in companies like IBM, Apple, and GM. Employees who stay in these companies over the long term, those who move up the ladder into the executive suite, tend to personify these corporate cultures to a great degree. Employees marry each other, socialize with each other, attend the same events. In company towns, this corporate culture can characterize the entirety of the town itself.

Which is why the current IRS scandal has left me completely unsurprised.

What kind of person goes to work for the IRS? People who like numbers, sure. Accountants. Tax attorneys. Clerks. Secretaries. For a lot of people, a job at the IRS is just that...a job. It pays the bills. It's not a calling, it's a paycheck. But there are many careerists in the IRS for whom the job is an avenue to power over their fellow men -- the power to tax is the power to destroy, after all, and many people find this power intoxicating. Few other government institutions have such presence and power in an individual citizen's life.

It's also true that to move up at the IRS, you must embrace the corporate culture of the place. The culture has been formed in the byzantine twists and turns of the US tax code, in the landscape of rules that govern the IRS itself, and in the office environment common to so many public sector bureaucracies. To succeed in the IRS, an employee must do things the proper way. Entrepreneurs may be appreciated in the private sector, but they are specifically discouraged in the public sector. If you want to get along in government service, you go along. If you can convince yourself that going along is not only the smart thing to do but the right thing, so much the better.

The IRS is not supposed to be a partisan agency. The federal bureaucracy was explicitly designed to be non-partisan so that it would impartially enforce the tax laws and regulations passed by the Congress and approved by the Executive. But the IRS like many other federal bureaucracies tends to be staffed by people -- especially at the management level -- who believe in robust, activist government. In other words: it is staffed mainly by Democrats. And however nonpartisan the organization is supposed to be, it cannot help but reflect the culture of the people who comprise it. The IRS, being led by and staffed with activist-minded Democrats, cannot help but reflect that worldview. The culture reinforces itself because adherence to the culture is the only way to move up. Dissenters and contrarians do not last long in an organization like the IRS (any more than they do at the FBI or EPA or DoJ).

It's no surprise to hear that Lois Lerner's husband is a high-priced lawyer with an affinity for liberal activism. It's no surprise that Douglas Shulman's wife heads a liberal group dedicated to campaign finance reform. You'll find the same pattern repeated throughout the organization, no doubt. Like seeks out like. The culture reinforces itself. Everybody's kids go to the same schools, everybody knows everybody else's first name, and no one has to discuss politics because it's simply understood. The same thing happens at college campuses. Liberal politics, statism, the primacy of the regulatory state: it's just the water these people swim in.

This is the basic danger of a government that has grown too large. The federal machinery will trend Democrat no matter who happens to occupy the White House, Senate, or House of Representatives. And this is because the ideology that drives people to vote Democrat is also the ideology that makes them want to work for federal bureaucracies. The organizational culture in American federal service has become not just partisan but positively messianic during the age of Obama -- they're doing it for your own good, whether you know it or not! -- and the urge to suppress those with "wrong" opinions is becoming too strong to ignore. The tacit approval of Barack Obama and other powerful Democrat politicians removes any vestige of unease. It explains the near-complete lack of guilt or remorse shown so far by IRS management. In their minds, they are doing nothing wrong.

It's not a conspiracy because nothing actually has to be planned in secret. Nothing has to be commanded from on high. Nothing has to be written down, or even spoken in plain language. Lois Lerner and Douglas Schulman didn't need detailed marching orders. All the President had to do was muse sadly about how much he could accomplish if only these troublesome Tea Party types were out of the picture. Functionaries like Schulman and Lerner would immediately grasp the message and put it into action. (Even though no discussion along these lines was really necessary, Schulman and President Obama apparently did enjoy their little chats.)

Corporate culture in the private sector is moderated by two controlling forces: external competition, and the need to satisfy customers. A company must be aware of both, and be responsive, lest one go out of business. Ideology must take a back seat to survival. However, governmental organizations are bound by neither of these strictures and so the pathologies persist and harden into permanent features of the organizations. Instead of being a nonpartisan tax-collection and compliance agency, the IRS becomes an agent of Democrat Party ideology where tax compliance is the tool rather than the purpose of the agency.

This also illustrates why federal bureaucracies like the IRS will not reform from within. Employees of said agency will be asked to participate in their own extinction. Whatever else they may be, IRS employees do have this in common with everyone else: they have bills to pay. Mortgages, groceries, utilities, tuition, car payments. If the IRS is to be abolished or even significantly shrunk, that means the end of a lot of careers. It means the upheaval of a lot of lives. It means, for IRS employees above a certain GS rating, the loss of a significant amount of power -- both organizational and political. Most of all, it means forcing people deeply invested into an organizational culture to admit that this culture is fundamentally wrong.

The solution to this scandal is not to fire the likes of Lois Lerner (though that would be a good start). The answer is to abolish the agency entirely, and to make a concerted effort to shrink the size and reach of the entire federal government apparatus. For the federal government apparatus is not nonpartisan; it is and will continue to be predominately Democrat in culture. The federal government bureaucracy has been captured by Democrats in almost exactly the same way college campuses were captured.

A partisan government apparatus is a recipe for the abuse of power. To limit a government's power, we must limit its size. The IRS is an excellent place to begin because it presents the closest and greatest danger -- not just to conservatives, but to the very underpinnings of our system of government. An abuse of power this flagrant and egregious cannot be allowed to go unanswered.

"In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself. A dependence on the people is, no doubt, the primary control on the government; but experience has taught mankind the necessity of auxiliary precautions." -- James Madison, Federalist #51
What that means then is not that this or that elected politician is corrupt but that the government of the United States is corrupt. -- Mark Steyn

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posted by Monty at 08:00 AM

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