I write this with a heavy sense of irony. One the one hand it is great to the DLC under fire from the IRS. On the other hand, the IRS's case is based on the idea that the DLC is helping get democrats elected. The upshot is that the DLC is now forced to make the case that its purpose is to advocate for its agenda not to help the Democratic party.
DLC dismisses exempt status attack by IRS
"The Internal Revenue Service said the nonprofit organization became an advocacy group for elected Democrats and demanded payment for three years of back taxes."
"[T]he IRS could revoke the organization's nonprofit status for future tax exemptions if it benefited only one political party, namely Democrats. "
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Many of us would argue that the DLC has not actually been trying to help democrats. And that is the argument that the DLC is now being forced to make:
The court's ruling said that during a July 1999 political convention, DLC Chief Executive Officer Al From said the New Democrat agenda "has been so successful that the Republicans are trying to parrot our politics." The ruling also quoted Mr. From saying, "After all we went through, we're not going to sit idly by and let the Republicans reclaim the political center on the cheap."
Forbes has an article discussing the implications given that the DLC is not a typical 501(c) (3) charity:
The Democrats' Little Tax Secret
What's the practical value of a (c)(4) designation if it doesn't generate writeoffs for its donors? A (c)(4) isn't taxed as a for-profit business would be and doesn't have to disclose its donors, as a political action committee does.
The DLC responds that its exclusive purpose is to develop and promote its "Third Way" agenda and that some causes it has lobbied for--e.g., welfare reform, fast-track approval of free-trade agreements--got more Republican than Democratic votes in Congress.
I wish they would be even more clear and drop the words "centrist" and "third way" and just say they represent corporate business interests that are less bloodthirsty than many Republican supporters but still greedy enough to cut vital social programs. This may become clear if the DLC starts disclosing its donors.
Lastly, we get to hear again from Joe Lieberman and Ralph Nader. Lieberman may come to the rescue because as an Independent he may be their hope for bi-partisanship. While Nader-inspired group will go after the DLC
The Justice Department has hired a researcher from Public Citizen, the watchdog group founded by Ralph Nader, to help make the case against the DLC.