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Mr. MANSFIELD. Mr. President, I ask unanimous consent that 10 minutes be granted to the distinguished Senator from Tennessee, to be followed by the time limitation requested by the Senator from Alabama.

Mr. SPARKMAN. I shall not object, with the understanding that if anyone else requests time, I will object. I have commitments myself.

The PRESIDING OFFICER. Without objection, it is so ordered.

PRACTICE BY EXECUTIVE BRANCH OF EXAMINING INDIVIDUAL TAX RETURNS

Mr. GORE. Mr. President, this is a very disturbing matter that has been discussed here. I wish the record to show that I have not referred to any action of President Nixon in this regard.

Mr. MANSFIELD. Mr. President, may we have order?
The PRESIDING OFFICER. The Senate will be in order.

Mr. GORE. A number of statements have been made with respect to Presidential action with regard to the issuance of regulations.

The committee session which I attended did not have any evidence of any action on the part of President Nixon at all and I do not wish to allege any. I have not made reference to any.

I did make a statement that the procedure appeared to be loose, indiscreet, inadvisable, and I will say again improper, and as I said it was open ended. Here is what we have: A memorandum of conversations between Commissioner Thrower and Mr. Clark R. Mollenhoff. The memorandum states: Following through on our recent luncheon conversation

I then come to the sentence:

I would suggest that every time you have occasion to inspect a tax return, application for exemption, or other Internal Revenue file, you send me a memorandum briefly setting forth the nature of the request. Naturally—

Listen to how tight this is.

Naturally, we will infer in every case that the request is either at the direction of, or in the interest of, the President.

The Commissioner testified he had had no instructions from the President orally or in writing, and yet this memorandum stated he naturally assumes that every request will be at the direction of or in the interest of the President. What does "in the interest of" mean?

I shall read another sentence:

After receiving your request, we will make arrangements for the files to be assembled in my immediate suite of offices here and we will notify you as soon as they are ready for inspection.

Real accommodating, is it not? Real accommodating.

If, after inspection of the files, you want copies of any of the material inspected, we will be happy to make them for you.

Mr. President, I say this is an indiscreet way to treat a taxpayer's tax return. Who whispered to the distinguished senior Senator from Delaware that a tax return of a judge had been pulled and examined? Nobody whispered that to me. Has anybody whispered that to the chairman of the committee? Who whispers this about? How does it come that political figures are alleged to be involved, that hints are being whispered about them? This is disturbing.

I do not say the President had anything to do with it. I do not know. I would be inclined to think he did not. But by what right, by what possession, does the Commissioner of Internal Revenue say that he will assume that every request Mr. Clark Mollenhoff makes is at the direction of the President or in the interest of the President?

If nothing else comes of this, I hope we will arrive at a formalized procedure, because this is loose. I think it is irresponsible and improper. I cannot say it is illegal. I had previously thought it was. I am not prepared now to say so. But I want to make it so it is illegal.

This is not to question the right of the President to have access to a tax return. I do not question it. I think he should. I think if congressional committees have a need to know, it should be made available to them. But this does not go to a political operative going on a fishing expedition to find out what he can about tax returns.

Somebody might write a letter about another judge. Nothing has been alleged here with respect to the instance cited. Who has whispered the facts or the

name? I do not know the name or the facts, but nobody has alleged that the judge did anything wrong. Nobody has alleged any criminal acts. I just do not know the circumstances. I will not presume what the circumstances are. But if the contents of one taxpayer's files can be whispered about, the contents of every taxpayer's files can be whispered about.

We need to formalize a procedure to preserve the privacy and the confidential nature of the tax returns of every taxpayer.

Mr. ALLEN. Mr. President, much attention has been directed today in the Senate to the controversy between the Democratic Party chairman, Lawrence F. O'Brien, and Republican chairman, Rogers Morton, concerning the wisdom of a discretionary power in Mr. Clark Mollenhoff to investigate income tax returns of private citizens.

I have no evidence to indicate and no reason to believe that Mr. Mollenhoff has abused his discretionary power. On the other hand, I fully understand the concern of some that such a power could be abused if it were used strictly for political purposes.

It occurs to me that our concern about possible misuse of power to investigate tax returns might be more profitably directed toward the Internal Revenue Service. The possibilities of abuse at that source would seem limitless since IRS has access to all income tax returns.

For example, on April 13, 1970, a newspaper account indicated that a special task force of Internal Revenue agents had been assembled in Alabama and are asking questions about eight named political figures in Alabama, one being the brother of a candidate for statewide office and five of whom are currently campaigning for office in the State Democratic Party primary scheduled for May 5, 1970. These newspaper accounts cite "confidential field reports" and allegations made in a confidential report of the Internal Revenue Service's Audit Division as source of authority.

Mr. President, no one questions the right of Internal Revenue agents to investigate income tax returns if motivated by the duty to protect the public interest by fair and impartial enforcement of the law. On the other hand, if the investigation is motivated by political considerations-that is another story.

It stands to reason that any publicized investigation by the Internal Revenue Service tends to create a suspicion, to say the least, and suggests the possibility of a violation of law.

The newspaper accounts state that the investigation is still in its preliminary stages and that no charges have been brought against anyone. Nevertheless, the publicity concerning the investigation was allegedly based on information obtained from the Internal Revenue Service. The election is less than 3 weeks hence. The candidates named in the publicity are placed in a grossly unfair position of being compelled to refute the implications of the announced investigation.

The timing of this investigation has created questions in the minds of many Alabamians. They want to know if the investigation is politically motivated and who is responsible for the timing and for the release of supposedly confidential information if any such information was, in fact, released. It seems to me that these are valid questions.

Mr. President, I campaigned for the office of U.S. Senator from Alabama emphasizing among other things my sincere conviction that the Federal Establishment should not undertake to interfere in State political races. I hold firmly to that conviction.

I hope sincerely that we have not witnessed in Alabama a pattern for future political activities of this or any other administration.

THE EMERGENCY HOME FINANCING ACT OF 1970

The Senate resumed the consideration of the bill (S. 3685) to increase the availability of mortgage credit for the financing of urgently needed housing, and for other purposes.

Mr. Tower obtained the floor.

Mr. MONDALE. Mr. President, will the Senator yield?

Mr. TOWER. I yield.

Mr. MONDALE. Mr. President, I return to the amendment which I had earlier called up.

The PRESIDING OFFICER. The clerk will please state the amendment of the Senator from Minnesota.

Mr. MONDALE. Mr. President, I ask unanimous consent that the reading of the amendment be dispensed with, and that it be printed in the RECORD at this point. The PRESIDING OFFICER. Without objection, it is so ordered.

The amendment is as follows:

At the end of the bill insert a new section as follows:

"TREASURY BORROWING AUTHORITY FOR NEW COMMUNITIES PROGRAM

"SEC. 606. Section 407 (a) of the Housing and Urban Development Act of 1968 is amended by adding at the end thereof the following: "The Secretary may issue obligations to the Secretary of the Treasury in an amount outstanding at any one time sufficient to enable the Secretary to carry out his functions with respect to the guarantees authorized by this title. The obligations issued under this subsection shall have such maturities and bear such rate or rates of interest as shall be determined by the Secretary of the Treasury. The Secretary of the Treasury is authorized and directed to purchase any obligations of the Secretary issued under this subsection, and for such purpose the Secretary of the Treasury is authorized to use as a public debt transaction the proceeds from the sale of any securities issued under the Second Liberty Bond Act, as now or hereafter in force, and the purposes for which securities may be issued under such Act are extended to include purchases of the Secretary's obligations hereunder.'"

PROCEDURES TO BE FORMALIZED

Mr. ALEXANDER. And it remains the position of the Internal Revenue Service that there is this right under present law to tax information. What we have done is implement procedures, soon to be formalized, under which requests would be made in writing and a full record would be kept of such requests.

Mr. Whitaker, would you care to amplify?

Mr. WHITAKER. I would like to make certain that the record is clear, Mr. Chairman, that one of the problems we as lawyers see with the present statute, is that the framework of the rules and regulations which govern the conditions under which tax-return information is to be kept private or is to be made public is determined almost entirely by Presidentially approved regulations. It is my own view that this is a matter which really ought to be focused on by the Congress, and while we agree wholeheartedly with the framework under which we operate, it seems to me that the framework ought to be changed into a statutory framework rather than one which can vary with the views of those in our position and in the White House and in Justice, all of whom have an input in these regulations.

It is important for this reason that I certainly share with the Commissioner the view that we badly need clarification of the law and we think we need some change in the law which would in part put the regulatory framework into the statute.

Senator KENNEDY. It is not there at the present time?

Mr. ALEXANDER. No, sir.

Senator KENNEDY. And, as I understand from your responses, you are going to soon formalize your procedures, is that right? They have not been formalized at the present time?

Mr. ALEXANDER. That is correct. Mr. Willsey?

Mr. WILLSEY. That is absolutely correct.

Senator KENNEDY. When will they be formalized? And, when they are formalized, will you make those procedures available to the public? Mr. WILLSEY. We have a correlative problem, Mr. Chairman, in that

legislation is being actively considered here on the Hill right now, and while we have general operating understandings in the Commissioner's office and in the office of the different assistant commissioners, it probably would not be worthwhile to go through the complete formalization of procedures, other than those that apply internally, in view of the possibility of changes in the statute in the relative near future which we hope are going to be forthcoming.

Mr. ALEXANDER. The procedures we are talking about formalizing, Mr. Chairman, are procedures dealing specifically with White House access to tax information. We do, Mr. Chairman, have

Senator KENNEDY. Do I understand then that if the Congress does not act in the next 6 or 8 months, we might have to wait before you formalize procedures and regulations that will govern the contacts between the White House and the IRS?

Mr. ALEXANDER. No, we are not waiting, Mr. Chairman. We have moved informally and we are moving formally in-house. All this is

in-house.

Senator KENNEDY. Will the public know what procedures are being followed dealing with this?

PROCEDURES TO BE RELEASED TO PUBLIC

Mr. ALEXANDER. Mr. Chairman, the public will know because we will release these procedures to the public along with substantially all of the rest of our manual.

Senator KENNEDY. When will that take place?

Mr. ALEXANDER. As soon as possible. I would like to say that we would have this in place by the end of next week but I found in my brief career in Government, Mr. Chairman, that things sometimes move much slower than I would like.

Senator KENNEDY. Can we anticipate it within, say, the next couple of weeks?

Mr. ALEXANDER. Oh, yes. I see no reason why that cannot be done. Senator KENNEDY. If I understand you, then, you are going to formalize procedures which would regulate, or at least which the IRS under your leadership would follow, that would relate to contacts being made between the White House and the IRS? Do I understand that?

Mr. ALEXANDER. That understanding is correct, Mr. Chairman.

CHANGES IN THE STATUTE REQUIRED

Senator KENNEDY. Then, second, as I understand it, it is the considered judgment of you and your colleagues, that there ought to be changes made in the statute, and that these procedures ought to be formalized in statutory form. Am I correct on that?

Mr. ALEXANDER. That is correct, Mr. Chairman. The way to solve the problem for the long run is not to depend upon procedures established by a particular Commissioner but instead establish sound and restricted procedures under the law itself.

Senator KENNEDY. That seems to me to be wise, because otherwise you could very well have shifting procedures under different commissioners, and it would be extremely confusing to the public.

Let me ask you this.

Have you made any proposed suggestions now for such changes in the statute, either to the Congress or to the White House, or to the Treasury Department?

TREASURY AND OMB INVOLVED IN CODE AMENDMENT

Mr. ALEXANDER. Mr. Chairman, I have testified generally about the scope of the problem, the nature of the problem, and the solution to the problem before several committees of Congress beginning last August.

We are working with the Treasury Department now in drafting an amendment, a substitute to section 6103 of the Code which is not ready for submission as it has not been fully approved by the Treasury Department, has not yet been submitted to the Office of Management and Budget.

The administration, of course, speaks through the Office of Management and Budget on matters such as this, but basically the objective that we see and that they see and that the Vice President's Committee sees, is the same.

Senator KENNEDY. It always amazes me that OMB decides Government policy on which you obviously have the greatest degree of competence.

Mr. ALEXANDER. Part of it does affect our relations with other departments and agencies. We have under present law an obligation to supply tax-return data and information to the Bureau of the Census, for example, for their purposes and the Bureau of the Census is a good agency that knows and fully recognizes its duties to keep confidential information private. We have other responsibilities toward other Government departments and agencies, and because this involves more than just IRS, the Office of Management and Budget is properly involved.

Senator KENNEDY. Well, would I assume it is going to take you more than a week to clear it through OMB and the Treasury Department?

Mr. ALEXANDER. I think that assumption is a safe one, Mr. Chairman. Senator KENNEDY. How long? Can you give us any idea what your recent contacts have been with OMB and Treasury Department and when they indicated they might get at this?

Mr. ALEXANDER. Mr. Whitaker and I have been discussing this issue with top Treasury officials. As I said, the objective we seek is a common objective. We may have minor differences in the details of the legislation. How long it might take in OMB is something that is not only beyond my control but beyond my knowledge.

Senator KENNEDY. Can you tell us how long it has been over there now?

Mr. ALEXANDER. We have been working hard on this particular problem, Mr. Chairman, since before May when I testified before the Ways and Means Committee on this subject, on May 6.

Mr. WHITAKER. The statutory provision has not left main Treasury

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Senator KENNEDY. And it still has to go to OMB?

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