Another Tax Day has come and gone. I hope that you were able to file your taxes before the midnight deadline on April 18th. The Taxpayers Protection Alliance (TPA) will continue to monitor the Internal Revenue Service (IRS) to make sure they are processing taxes in a timely manner and also safeguard your information. Please let us know if you experience a significant delay with your refund. And, if you need to call the IRS, please let us know how that interaction goes.
IRS Cuts Employee Suggestion Program
Normally, we would be happy to hear about a cut at the IRS. However, this is not a good cut. It’s been reported that the IRS eliminated its “employee suggestion program” (ESP) in October 2021 without establishing a suitable replacement. According to the Treasury Inspector General for Tax Administration (TIGTA), the report further relays that the ESP, during its operation, was rife with inefficiencies and employee error and that many IRS employees have little confidence in leadership’s commitment to agency improvement. TIGTA’s office advises the IRS to consult with those federal agencies that run successful ESP programs and to devise a new employee feedback mechanism. Last year, the Inflation Reduction Act that became law infused the agency with $80 billion. The agency, already over-funded, could benefit greatly from robust employee feedback. For example, in one case described in the report, an employee reported to the ESP that the IRS division processing bankruptcies was over capacity, causing administrative errors and potential taxpayer violations. The employee’s suggestion seemed to contain the required elements, yet ESP staff rejected it without notifying the employee of the reasons.
Any subsequent IRS feedback mechanism should incentivize staff accountability and rule-following and promote rapid processing of submissions, particularly in initial phases handled by non-experts. Further, those non-expert employees ought not to be allowed to dally with routine administrative tasks. The IRS’s previous ESP was rife with misconduct, effectively lacking even basic — yet necessary — quality-assurance measures. IRS brass nixed the ESP because of high operational costs. The high cost that the IRS was worried about was a $4 million a year expenditure.
ESP personnel also regularly broke protocol when processing employee suggestions. In one sample analyzed by the IG’s team, 34 of 40 suggestions were improperly evaluated. “The ESP business unit evaluators did not consider the overall concept of a suggestion, instead they made their determinations based on whether a suggestion could be adopted verbatim as described in the submission,” a later section of the TIGTA report states. “However, our review of the ESP guidance found that suggestions could be adopted and awarded based on their concept or key components that lead ultimately to a change to IRS processes.” The report details several other similar staff failures. According to the Federal Employee Viewpoint Survey for 2021, the IRS ranked 271 out of 432 total federal subcomponent agencies in “engagement and satisfaction.” In the categories of “innovation” (employee perceptions of the agency’s efforts to improve) and “recognition” (for employees’ workplace performance), the IRS ranked 360 out of 432 and 295 out of 427, respectively.
The IRS needs external and internal accountability measures. Shutting down the ESP because of cost or lack of effectiveness says more about the leadership managing the program than about the program itself.
Bad News in the Bayou
The trickle of state legislatures introducing proposals that would require social-media platforms to obtain parental consent before registering underaged users is fast becoming a torrent. Louisiana on Monday became the latest to do so with the introduction of S.B. 162 in the State Senate. The bill would require platforms with at least 5 million account holders to obtain parental consent for all would-be users under the age of 16. It also explicitly requires that platforms confirm the age of all Louisianan account holders – including existing users. Advocates of mandated age verification on social media may have good-faith concerns for the well-being of the state’s youth. However, they fail to account for the vast privacy risks their preferred policy necessarily entails. The most suggested form of verification is to require users to submit identification. Forcing platforms to acquire sensitive user data – say, a scan of a government-issued identification card – creates myriad hacking opportunities for cyber criminals. Even large companies and governments fail routinely to safeguard sensitive data. For instance, DC Health Link in March revealed that a hacker stole the data of more than 56,000 customers, reportedly including members of Congress and staffers. Besides private criminals, foreign adversaries – e.g., Moscow and Beijing – pose an ever-greater cyber threat. What’s more, other methods of age verification are still unreliable, insecure, or otherwise unfeasible.
Mandating age verification on social media also largely eliminates the ability of all users – adult and child alike – to speak online anonymously. This would likely abridge recognized constitutional protections. In McIntyre v. Ohio Elections Commission (1995), the Supreme Court held that Margaret McIntyre was entitled by the First Amendment to distribute political pamphlets anonymously. “Under our Constitution, anonymous pamphleteering is not a pernicious, fraudulent practice, but an honorable tradition of advocacy and of dissent,” Justice John Paul Stevens wrote for the majority. “Anonymity is a shield from the tyranny of the majority.” Justice Clarence Thomas, concurring in the judgement, examined the America’s free-speech tradition and concluded that the historical record indicates “the Framers understood the First Amendment to protect an author’s right to express his thoughts on political candidates or issues in an anonymous fashion.” Curtailing citizens’ right to speak freely and anonymously, particularly on social media, is unlikely to survive judicial scrutiny. The proposal’s flaws don’t end there. S.B. 162 would “prohibit the use of targeted or suggested groups, services, products, posts, accounts, or users in the (minor’s) account.” Disallowing teens from discovering new content would radically degrade their user experience. While social media algorithms do occasionally recommend harmful content to young users, they far more often assist users of all ages in a number of ways. Moreover, banning recommendations would, in fact, prevent platforms from tailoring the sort of family-friendly experience S.B. 162’s advocates desire for young users. Even if one were to concede the necessity that government regulate children’s online experience – a matter handled best by parents – this provision is far too sweeping. It would implement a chainsaw to do a scalpel’s work.
When considering proposed internet regulations, conservative lawmakers like those who control both houses of Louisiana’s legislature should remember that economist Friedrich Hayek’s famous “Knowledge Problem” theory – which states that no legislature or bureaucrat possesses or can possess the knowledge necessary to effectively plan an economy – holds true as much in digital markets as in any other sector.
BLOGS:
Monday: This Tax Day, Don’t Give the IRS More Money…or Power
Wednesday: TPA Urges HELP Committee to Reject Su Nomination
Thursday: TPA Applauds the Limit, Save, Grow Act of 2023
Friday: Op-Ed: CFPB Likely Skirted Transparency Laws with Partisan Fellowships
MEDIA:
April 14, 2023: Patrick Hedger joined ‘Stacy on the Right’ on SiriusXM to talk about Tax Day and the IRS.
April 16, 2023: The Associated Press quoted TPA in their story, “New push on US-run free electronic tax-filing system for all.”
April 17, 2023: WBFF Fox45 (Baltimore, Md.) interviewed me about the debt ceiling.
April 18, 2023: Patrick Hedger joined “Need to Know with Jeff Angelo” on WHO Newsradio 1040 (Des Moines, Ia.) to talk about Tax Day and the IRS.
April 18, 2023: RealClear Markets ran TPA’s op-ed, “President Biden Is Trying To Reanimate Defunct Antitrust Theories.”
April 19, 2023: Catalyst ran TPA’s op-ed, “CFPB Likely Skirted Transparency Laws with Partisan Fellowships.”
April 19, 2023: The Baltimore Sun (Baltimore, Md.) quoted TPA in their story, “Baltimore County changes rule to shield retirement decisions from the public.”
April 20, 2023: I appeared on WBOB 600 AM (Jacksonville, Fla.) to talk about the debt ceiling.
April 20, 2023: WBFF Fox45 (Baltimore, Md.) interviewed me about Mayor Scott’s report on accomplishments.
April 20, 2023: The Washington Examiner (Washington, D.C.) ram TPA’s op-ed, “Biden's proposed tax on unrealized capital gains fundamentally misunderstands what wealth is.”
April 21, 2023: RealClear Policy ran TPA’s op-ed, “FDA About to Make Drug Approvals More Difficult.”
April 21, 2023: American Spectator ran TPA’s op-ed, “Biden’s ‘Buy American’ Requirement Will Hurt Domestic Broadband Providers.”
Have a great weekend!
Best,
