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Paul Kiel and Jesse Eisinger write today about “How the IRS Was Gutted.” The nickel answer to the question is easy: The IRS was gutted by Republicans who didn’t like having their rich friends audited all the time. For the longer answer, you’ll have to click the link and read the story. In the meantime, however, here are two charts:
On the left, you can see that the IRS enforcement budget has been slashed since 2010. But it’s the chart on the right that shows exactly what effect that’s had. Poor folks have seen a small decline in audits of their little annual EITC payments, but that was always peanuts anyway. The real revenue-loser is in the green line, showing that audits of rich people have plummeted from 8 percent to 2.5 percent. If you’re rich, the odds of being audited has gone down by two-thirds over the past decade or so.
This GOP war against the IRS has been going on since the mid-90s, when Republicans first started describing IRS agents as jackbooted thugs knocking down doors at midnight and scaring the women and children. But in 2010 Republicans won control of the House—and finally they could really do something to help their donors. And they did. They trashed the IRS enforcement staff and cut the revenue from audits by more than a third, from $23 billion to $14 billion. Mission accomplished.