Senator: IRS targeting of tea party is 'chilling'

WASHINGTON (AP) — Republicans said Sunday that the Internal Revenue Service's heightened scrutiny of conservative political groups was "chilling" and further eroded public trust in government.

Lawmakers said President Barack Obama personally should apologize for targeting tea party organizations and they challenged the tax agency's blaming of low-level workers.

"I just don't buy that this was a couple of rogue IRS employees," said Sen. Susan Collins, R-Maine. "After all, groups with 'progressive' in their names were not targeted similarly."

If it were just a small number of employees, she said, "then you would think that the high-level IRS supervisors would have rushed to make this public, fired the employees involved, apologized to the American people and informed Congress. None of that happened in a timely way."

The IRS said Friday that it was sorry for what it called the "inappropriate" targeting of the conservative groups during the 2012 election to see if they were violating their tax-exempt status. The agency blamed low-level employees, saying no high-level officials were aware.

But according to a draft of a watchdog's report obtained Saturday by The Associated Press that seemingly contradicts public statements by the IRS commissioner, senior IRS officials knew agents were targeting tea party groups as early as 2011.

The Treasury Department's inspector general for tax administration is expected to release the results of a nearly yearlong investigation in the coming week.

Lois G. Lerner, who heads the IRS division that oversees tax-exempt organizations, said last week that the practice was initiated by low-level workers in Cincinnati and was not motivated by political bias.

But on June 29, 2011, Lerner learned at a meeting that groups were being targeted, according to the watchdog's report. At the meeting, she was told that groups with "Tea Party," ''Patriot" or "9/12 Project" in their names were being flagged for additional and often burdensome scrutiny, the report says.

The 9/12 Project is a group started by conservative TV personality Glenn Beck.

Rep. Mike Rogers, R-Mich., said "the conclusion that the IRS came to is that they did have agents who were engaged in intimidation of political groups is as dangerous a problem the government can have."

He added, "This should send a chill up your spine. ... I don't know where it stops or who is involved."

Congressional Republicans already are conducting several investigations and asked for more.

"This mea culpa is not an honest one," said Rep. Darrell Issa, R-Calif.

After the AP report Saturday, White House press secretary Jay Carney said that if the inspector general "finds that there were any rules broken or that conduct of government officials did not meet the standards required of them, the president expects that swift and appropriate steps will be taken to address any misconduct."

Collins said the revelations about the nation's tax agency only contribute to "the profound distrust that the American people have in government. It is absolutely chilling that the IRS was singling out conservative groups for extra review."

She said she was disappointed that Obama "hasn't personally condemned this." The president, Collins said, "needs to make crystal clear that this is totally unacceptable."

Lerner said that about 300 groups were singled out for additional review, with about one-quarter scrutinized because they had "tea party" or "patriot" somewhere in their applications.

Lerner said 150 of the cases have been closed and no group had its tax-exempt status revoked, though some withdrew their applications.

Collins appeared on CNN's "State of the Union," Rogers was on "Fox News Sunday" and Issa spoke on NBC's "Meet the Press."

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State senator comes out during gay marriage debate

State Senator Karen Peterson (photo: state of Delaware)

Delaware State Senator Karen Peterson came out as lesbian during the floor speeches of a debate about legalizing gay marriage, multiple outlets reported.

Sen. Peterson said, "If my happiness somehow demeans or diminishes your marriage, you need to work on your marriage," according to Think Progress.

Via Think Progress:

No one chose to be gay. We are what God made us. We don’t need to be fixed. We aren’t broken. [...] My partner Vicki and I have been together for 24 years. Last year, we entered into a civil union. [...] If my happiness somehow demeans or diminishes your marriage, you need to work on your marriage.

The Delaware Senate voted to approve marriage equality legislation, making Delaware the 11th state the recognizes the marriages of same-sex couples. Governor Jack Markell has said he will sign the bill into law.

Victory Fund broke the news about Sen. Peterson via Twitter:

Reactions were positive as others learned of the news via the social network.

A similar incident occurred earlier this year, when, during a debate on gay marriage, Nevada state Senator Kelvin Atkinson announced that was gay.

Last week, Rhode Island became the 10th state to legalize gay marriage.

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GOP senator wants info on student in Boston case

May 1 (Reuters) - Post position for Saturday's 139th Kentucky Derby at Churchill Downs after Wednesday's draw (listed as barrier, HORSE, jockey, trainer) 1. BLACK ONYX, Joe Bravo, Kelly Breen 2. OXBOW, Gary Stevens, D. Wayne Lukas 3. REVOLUTIONARY, Calvin Borel, Todd Pletcher 4. GOLDEN SOUL, Robby Albarado, Dallas Stewart 5. NORMANDY INVASION, Javier Castellano, Chad Brown 6. MYLUTE, Rosie Napravnik, Tom Amoss 7. GIANT FINISH, Jose Espinoza, Tony Dutrow 8. GOLDENCENTS, Kevin Krigger, Doug O'Neill 9. OVERANALYZE, Rafael Bejarano, Todd Pletcher 10. PALACE MALICE, Mike Smith, Todd Pletcher 11. ...

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Senator Paul stirs business ire over blocking of tax treaties

By Patrick Temple-West

WASHINGTON (Reuters) - Senator Rand Paul is coming under pressure from some multi-national businesses to drop his opposition to tax treaties between the United States and other nations.

Citing privacy concerns about Americans' tax data, Paul, a Republican and libertarian, has single-handedly blocked Senate action on treaties with Hungary, Switzerland and Luxembourg that have been signed by authorities on both sides, but have been awaiting Senate review since 2011.

At least six other tax treaties or treaty updates -- with Chile, Spain, Poland, Japan, Norway and Britain -- may soon be added to the Senate's queue for confirmation votes.

Major U.S. businesses such as IBM Corp and Fluor Corp are lobbying for Senate action on tax treaties, according to Senate lobbying disclosure documents.

"How many treaties will be held hostage?" asked Cathy Schultz, a lobbyist for the National Foreign Trade Council, a Washington, D.C.-based group that represents companies such as Caterpillar Inc and Pfizer Inc.

Paul has said he is concerned that recent treaties would give foreign governments too much access to U.S. citizens' tax information, a stance that has some support among like-minded conservative libertarians.

"Rand Paul is not a typical senator who may bend over to business lobbyists," said Chris Edwards, director of tax policy at The Cato Institute, a libertarian think tank.

"I am very concerned about this increasingly aggressive international exchange of information," Edwards said.

NO APPROVALS SINCE 2010

No new tax treaties or treaty updates have been approved since 2010, when Paul was elected as the junior senator from Kentucky on a wave of support for Tea Party-aligned Republicans.

Paul recently declined to answer questions from a reporter in a Capitol hallway about the "hold" he has placed on the treaties. Under Senate rules, one senator can prevent a motion from reaching a vote on the Senate floor.

Paul's staff did not reply to repeated requests for comment.

"There's never really been an objection of this sort and a hold that's gone on this long," said Nancy McLernon, president of the Organization for International Investment, which lobbies in Washington on behalf of foreign companies.

In an effort to sway the senator, McLernon said her group would be lobbying both parties to draw attention to the tax treaties. "Let's stop with the self-inflicted wounds," she said.

The United States has tax treaties with more than 60 countries, ranging from China to Kyrgyzstan.

The agreements previously have routinely won Senate approval with little controversy and accomplished their main purpose of preventing double-taxation of income and profits.

In recent years, tax treaties have begun to play an increasing role in efforts by the United States and major European Union countries to crack down on tax avoidance.

The U.S. Treasury in 2012 began signing new tax pacts with countries as part of implementation of the U.S. Foreign Account Tax Compliance Act, a 2010 anti-tax-evasion law.

The law, known as FATCA, which takes effect in January 2014, will require foreign financial institutions to disclose to the United States information about Americans' accounts worth more than $50,000.

SWISS A DRIVING FORCE

Switzerland, a long-time bastion of banking secrecy, is under international pressure to change its ways, and FATCA has been a driving force in that. The United States and Switzerland in February signed a FATCA implementation agreement that would make more information available to U.S. authorities about the financial interests of Americans in Switzerland.

But the taxpayer information exchange cannot go into force without Senate approval of the U.S.-Swiss tax treaty.

The Senate's delayed action on tax treaties could convince other countries to stop negotiating with the United States on tax matters, said John Harrington, a former Treasury tax official who is now a partner at law firm SNR Denton.

Paul, seen as a possible 2016 presidential contender, has taken a position that sets up a clash of traditional Republican interest groups: big business and libertarian ideologues.

In this sense, Paul is in the forefront of the party's search for a new identity since Republicans lost the presidential race last year, as well as numerous seats in the House of Representatives.

Looking toward a possible 2016 White House bid, Paul told reporters earlier this month that he will visit early-voting states this year and make a final decision next year.

New Republicans such as Paul are shifting the party away from its business-first agenda, said Dan Holler, communications director for Heritage Action, a conservative group.

"The party is not being reflexively pro-business," he said.

(Reporting by Patrick Temple-West; Editing by Kevin Drawbaugh and Leslie Adler)

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Letter to Miss. senator tests for ricin

WASHINGTON (AP) — An envelope addressed to Sen. Roger Wicker of Mississippi twice tested positive Tuesday for ricin, a potentially fatal poison, congressional officials said, heightening concerns about terrorism a day after a bombing killed three and left more than 170 injured at the Boston Marathon.

One senator, Claire McCaskill of Missouri, said authorities have a suspect in the fast-moving ricin case, but she did not say if an arrest had been made. She added the letter was from an individual who frequently writes lawmakers.

The FBI and U.S. Capitol Police are both investigating. Both declined to comment.

Terrance W. Gainer, the Senate sergeant-at-arms, said in an emailed message to Senate offices that the envelope to Wicker, a Republican, had no obviously suspicious outside markings and lacked a return address. It bore a postmark from Memphis, Tenn., where mail from parts of northern Mississippi has long been processed.

He added there was "no indication that there are other suspect mailings." Yet he urged caution, and also said the Senate off-site mail facility where the initial tests were performed on the letter will be closed for a few days while the investigation continues.

The letter was discovered at a mail processing plant in Prince George's County in suburban Maryland, according to Sen. Dick Durbin, D-Ill.

Wicker's office issued a statement saying "any inquiries regarding member security must be directed to the United States Capitol Police."

The 61-year-old lawmaker was appointed to the Senate in 2007 and won election to a full term two years ago. He previously served a dozen years in the House.

He has a solidly conservative voting record, so much so that he drew notice last week when he voted to allow debate to begin on controversial gun legislation in the Senate. "I cast this vote at the request of the National Rifle Association, of which I am a member," he said in a statement at the time that added he has a 100 percent voting record in favor of Second Amendment rights.

But Majority Leader Harry Reid told reporters of the letter, and other lawmakers said they had been provided information by the office of the Senate sergeant-at-arms.

Milt Leitenberg, a University of Maryland bioterrorism expert, said ricin is a poison derived from the same bean that makes castor oil. According to a Homeland Security Department handbook, ricin is deadliest when inhaled. It is not contagious, but there is no antidote.

"Luckily, this was discovered at the processing center off premises," Durbin said. He said all mail to senators is "roasted, toasted, sliced and opened" before it ever gets to them.

One law enforcement official said evidence of ricin appeared on two preliminary field tests of the letter, although such results are not deemed conclusive without further testing. The official spoke on condition of anonymity because the investigation remains active.

The discovery evoked memories of the days after the terrorist attacks of Sept. 11, 2001, when mail laced with anthrax began appearing in post offices, newsrooms and congressional offices.

That included letters sent to Sen. Tom Daschle, D-S.D., who was Senate majority leader, and Sen. Patrick Leahy, D-Vt. Two Senate office buildings were closed during that investigation.

Overall, five people died and 17 others became ill. The FBI attributed the attack to a government scientist who committed suicide in 2008.

More immediately, though, the discovery came as lawmakers were demanding answers to the attacks in Boston a day earlier.

There was no evidence of a connection between the bombings and the letter addressed to Wicker.

___

Associated Press writers Andrew Miga, Seth Borenstein, Eric Tucker, Henry Jackson and Eileen Sullivan in Washington and Emily Wagster and Jeff Amy in Jackson, Miss., contributed to this report.

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Republican senator sees Obama budget offer as positive

WASHINGTON (Reuters) - South Carolina Senator Lindsey Graham on Sunday became the first prominent Republican to publicly praise, however lukewarm, the budget proposal the White House outlined last week.

Graham said that while he believes President Barack Obama's plan is overall bad for the economy, "there are nuggets of his budget that I think are optimistic." He was speaking on NBC's "Meet the Press" program.

Graham, a conservative who has deviated from party positions in the past, and has said he would consider raising up to $600 billion in new tax revenue if Democrats accept significant changes to Medicare, the government health program for elderly Americans, and Medicaid, the health safety net for low-income people.

The White House on Friday said the president would propose a budget that would offer cuts to so-called entitlement programs such as Social Security, a retirement program, and Medicare in exchange for increased tax revenues and a commitment to spend money on education and infrastructure repair.

Obama's proposal, which will formally be made public on Wednesday, is a symbolic document, and both the Senate and House of Representatives have already passed their own budget resolutions.

The president's aides have said he hopes to use the offer to appeal to enough middle-of-the-road lawmakers of both parties to pass a broad deal to reduce the budget deficit.

Obama also hopes to reverse the deep spending cuts that automatically kicked in March 1 as a result of the failure of the White House and Congress to reach an agreement on replacing them.

Graham's reception of the president's budget proposal is warmer than fellow Republicans and some of the president's own allies have accorded it so far.

House Speaker John Boehner said last week the president was ignoring Republicans' staunch opposition to any tax hikes. And independent Senator Bernie Sanders, who votes with the Democrats, said he would oppose any efforts to lower payments to Social Security beneficiaries.

But Graham said that the president's offer contained approaches to cutting spending that he supports. One is the proposal to index cost-of-living increases for government program benefits to a less-generous measure of inflation.

"The president is showing a little bit of leg here, this is somewhat encouraging," Graham said. "He has sort of made a step forward in the entitlement-reform process."

Obama has invited 12 Republican senators for dinner on the day of the budget release as part of an effort to soften resistance among the opposition political party.

"The president's focus, in addition to the regular order process that members of Congress say they want, is to try to find a caucus of common sense, folks who are willing to compromise, that don't think compromise is a dirty word, and try to get something done," White House senior advisor Dan Pfeiffer said on ABC News' "This Week with George Stephanopoulos" program.

(Reporting By Aruna Viswanatha and Philip Barbara, writing by Mark Felsenthal)

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Another Democratic Senator Flips on Gay Marriage

Another Senate Democrat has come out in support of same-sex marriage, which leaves six Senate Democratic holdouts who have yet to embrace marriage equality. Today, Sen. Bill Nelson, D-Fla., flipped and announced that he now supported same-sex marriage.

The senator made the announcement during an interview today with the Tampa Bay Times, saying, "It is generally accepted in American law and U.S. society today … that all men are created equal, that they are endowed by their creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness. I believe that. The civil rights and responsibilities for one must pertain to all," he told the Tampa Bay Times.

Nelson later confirmed his switch to ABC News.

READ MORE: Majority of Senate Backs Same-Sex Marriage

This marks the ninth Senate Democrat since last week to reverse course and now embrace same-sex marriage. The six Senate Democrats who continue to oppose marriage equality in some way are are Heidi Heitkamp of North Dakota, Joe Manchin of West Virginia, Mary Landrieu of Louisiana, Joe Donnelly of Indiana, Mark Pryor of Arkansas and Tim Johnson of South Dakota.

Two Republican senators have endorsed same-sex marriage: Rob Portman of Ohio and Mark Kirk of Illinois.

READ MORE: Republicans Predict Fraud, Bestiality if Gay Marriage is Legal

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