Friday, November 19, 2021

Everybody Hates the IRS

Before my dad retired, he was a senior executive at the IRS, and he reported to the Commissioner of the IRS. Part of his role involved reviewing the budget for his department so that he could present it to the Commissioner. This would then be incorporated into the final budget proposal. 

My dad noted that the IRS budget proposal was typically more than they actually needed. The budget-maximizing bureaucrat model would suggest that the Commissioner is misleading Congress about the true needs of the IRS. Congress is forced to accept their proposals. Though this may reflect the behavior of other agencies, this is not the case for the IRS. Congress typically rejects significant components of the IRS's proposal.

For the past decade, members of Congress have voted to decrease the size of the IRS. My dad complained that this has truly affected its operational capacity. The IRS has substantially cut their staff, and, as of 2017, I believe my dad still used Microsoft Office 2007 on his work laptop. Simply put, voters hate the IRS, and it is politically popular to decrease their budget. The Commissioner has learned to overestimate the proposal because he knows that Congress will only approve a fraction of the budget. The Commissioner hopes that enough will be left in the appropriations bill to keep the IRS functional. Therefore, a more appropriate assessment is that legislators will do what is necessary to be reelected.

1 comment:

Kevin Poole said...

I understand this, but I have a slightly different take. So, legislators do act to get reelected. However, I think this may be too broad of an argument to make for the restricted budget of the IRS. Sure, they may limit the budget to gain some political clout, but very few Americans are not in tune enough with the political realm to even be aware of the budget and its cuts. And, if this were really the case, legislators would work to cut the budget of all of its agencies because everybody hates taxes, and our taxes fund these agencies. This is not the case, however. For example, my brother is a cybersecurity analyst for the department of homeland security and I am quite sure that his job is a waste of money. He gets in trouble for finishing projects too quickly and has started playing computer games at work to avoid being reprimanded for being too efficient. All of this is so that the firm can gain its contracted budget and be on track to receive the same money the following year. If legislators really wanted to just be reelected, they'd work to cut out all of the excess waste in bureaucracy because it would directly impact their constituents positively. So, yes, everybody hates the IRS, but I don't think funding is being cut from just the IRS as a campaign strategy.