My Facebook Friend Uncle Sam Is Too Friendly

The IRS and the  Department of Justice have released documents revealing their approach to the use of social networking sites in response to last year's Freedom of Information Act claim by the Electronic Freedom Frontier against six federal agencies.  Yes, Uncle Sam uses Facebook, Twitter, MySpace, etc. – Yawn.  The big surprise?  The IRS is a pussycat.  That's right, the Service will collect information from social networking sites, but it's policies forbid use of fake sites and deception generally.  The IRS looks at only public information and it trains it's people to follow these policies.

In an example from the IRS policy, a revenue officer discovers that a taxpayer  maintains a social networking site to advertise the taxpayer's services as a comedian. The officer discovers that the site lists dates and locations of past and future performances. That information could be useful in determining fees paid to the comedian/taxpayer for his performances and the cities where those fees were deposited.

Hold on for just one minute.  OK, now that I've permanently deleted my MySpace Comedy site, let's think about this.  The DOJ is willing to use some deception on the Internet in the interests of justice.  Other federal agencies will probably be releasing documents announcing even more intrusive use of these sites -  that's right, Homeland Security is already your close, personal friend. The IRS can and will set up a sting in the real world, even if it won't do so in Second Life.  Why?  Why is the IRS tying it's own hands when it comes to using social networking sites, while other law enforcement agencies follow the same rules they do in real life? Deception in the name of law enforcement, subject to constitutional constraints,  is permitted and a well planned sting often nets more bad guys with less resources than traditional reactive law enforcement.

One reason may be that the user agreements for the social networking sites generally prohibit deception -which gives the sites some ability to deal with reported problems even if they do very little to enforce this provision proactively.  That isn't stopping the other federal  agencies, why the IRS?  Because it's been beaten about the head and shoulders for three decades by Congress, who seems to be more interested in catering to the Tea Party crowd than the majority of taxpayers. 

On average, tax evasion adds $2,000 to the burden carried by each of us who actually pay our taxes.  Reducing tax evasion is an untapped revenue source that can uncover billions of dollars to close federal budget deficits with no pain for the honest citizen.  The IRS, or at least some of its agents, may have been somewhat undisciplined and overzealous at one time, but after three decades of punishment the Service has learned its lesson.  It's time for the pendulum to swing back.  Vigorous enforcement is essential to a fair system of taxation.  It doesn't just catch tax evaders after the fact, it encourages the honest taxpayer to stay honest, not just with fear, but with the knowledge that everyone else is paying their share.  The IRS should be subject to rules and limits in any enforcement activity, including any use of social networking sites, but it should not be subject to special, self-imposed limits that other law enforcement agencies do not follow.  Without effective enforcement a tax system that relies heavily on voluntary compliance is not sustainable, and if that pendulum keeps swinging away from vigorous enforcement the cost of evasion will continue to mount.

Photo Credit: Mandiberg