Obama: No special prosecutor on IRS

President Barack Obama dismissed the idea of a special prosecutor to investigate the federal tax agency Thursday, saying probes by Congress and the Justice Department should be able to figure out who was responsible for improperly targeting conservative groups when they applied for tax-exempt status.

After days of inaction, Obama has tried to move swiftly in response to the growing uproar over reports of inappropriate targeting by the Internal Revenue Service.

A White House news conference, Obama promised to work with Congress in its investigations, and he reiterated that he did not know that conservative groups were targeted until it became public last Friday.

"Between those investigations I think we're going to be able to figure out exactly what happened, who was involved, what went wrong, and we're going to be able to implement steps to fix it," Obama said.

"I promise you this, that the minute I found out about it, then my main focus was making sure that we get the thing fixed," Obama added. "I'm outraged by this in part because look, I'm a public figure, if a future administration is starting to use the tax laws to favor one party over another or one political view over another, obviously, we're all vulnerable."

Obama forced out acting IRS Commissioner Steven Miller Wednesday. The president will appoint senior White House budget officer Daniel Werfel to replace Miller, according to a White House official, who was not authorized to speak on the record about the announcement and revealed Werfel's appointment on the condition of anonymity.

Werfel, 42, is the controller of the Office of Management and Budget, a job akin to a chief financial officer. Though Werfel was appointed to that job by Obama, he also worked during the administration of President George W. Bush.

Don't look for the controversy to subside.

Three congressional committees are investigating, and the FBI is looking into potential civil rights violations at the IRS, Attorney General Eric Holder said.

Other potential crimes include making false statements to authorities and violating the a law that prohibits federal employees from engaging in some partisan political activities, Holder said.

On Friday, Miller is scheduled to testify before a House committee.

Also testifying is J. Russell George, the Treasury inspector general for tax administration. George issued a report this week that blamed ineffective management in Washington for allowing IRS agents to improperly single out conservative political groups for additional, sometimes burdensome scrutiny when they applied for tax-exempt status. The practice went on more than 18 months, diminishing the ability of these groups to raise money during election cycles in 2010 and 2012, the report said.

The groups were applying for tax-exempt status as social welfare organizations. Unlike other charitable groups, social welfare organizations can engage on politics, but it is not supposed to be their primary mission.

It is up to the IRS to make the determination.

The inspector general's report said that if agents saw the conservative political labels "Tea Party" or "Patriots" in an application, they automatically set it aside for additional scrutiny that could hold up approval for an average of nearly two years. The agents did not flag similar progressive or liberal labels, though some liberal groups did receive additional scrutiny because their applications were singled out for other reasons, the report said.

Tea party groups generally advocate limited government. They emerged after Obama took office and take their name from the 1773 protest in Boston by American colonists against taxation without representation in the British government.

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Associated Press writers Jim Kuhnhenn and Stephen Ohlemacher contributed to this report.

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