by Dr. Phyllis Chesler
How one courageous proactive journalist took on the IRS over this issue - and won.
After a “long, lonely and expensive seven year struggle,” one that she alone, on behalf of Z STREET bore, Lori Lowenthal Marcus, the founder of Z STREET has just won a significant legal victory which grants her organization tax-exempt status and definitively exposes Obama’s IRS as obsessively anti-Israel.
Ironically, Marcus founded Z STREET in 2009 in order to “educate Americans about the Middle East and Israel’s defense against terror.”
The Z Street application was at first delayed, then frozen, because the IRS claimed as a defense, that Israel was viewed as a “terrorist entity,” and a country “with terrorism.”
Many of us suspected that Obama’s administration had politicized Homeland Security, the DOJ, the FBI, and the American relationship to the United Nations in ways that favored Islamism, Islamic terrorism, Palestine, Iran, and that demonized Zionism and Israel’s attempts at self-defense.
Z STREET”s successful lawsuit exposes how the Obama administration, through its power to grant or withhold tax-exempt status to groups, politicized and corrupted a policy of even-handedness, transparency, and accountability at the IRS.
Like the Western media, professoriate, international organizations, and very much like an Islamic world view, the American IRS viewed Israel, especially Israelis who lived “across the Green Line—the nonborder that delineates pre-1967 Israel from the territories it acquired in the Six Day War” as related to “terrorism” or as “terrorists.”
According to Marcus, "Our own investigation disclosed that between 2009 and 2016, while Z STREET’s application was stalled, the IRS needed no special scrutiny to grant numerous applications for tax-exempt status that explicitly proclaimed donations would be spent in Gaza—a territory formally under the jurisdiction of Hamas, which the U.S. State Department designates as a terror organization."
According to Marcus, in a personal interview, the following is merely a sampling of not-for-profits, which she obtained via Guidestar; the IRS had okayed these “charities” during the period that Z STREET’s application remained pending.
- American Charities for Palestine
- Institute for Palestine Studies USA Inc
- Teach for Palestine
- Palestine Foundation Inc.
- The Israel Palestine Project
- Opportunity Palestine
- Palestine Advocacy Project
- Physicians for Palestine Inc.
- Coloradans for Justice in Palestine
- Embrace the Children of Palestine Inc.
- Just Peace for Israel Palestine
- Justice for Palestine-Israel Inc.
- Opportunity Palestine
- Palestine in America inc. NFP
- Joining Hands for Justine [sic] in Palestine Israel Inc.
- Land of Canaan Foundation Inc.
- Peace of Palos Hills
- PAL Craftaid
- United Muslim Relief UMR
- Karamausa Inc.
- AJP Educational Foundation Inc.
- Friends of Al-Rowwad USA Inc.
- Holy Land Missions
- Project Unified Assistance
- Gaza's Hope
- Project Unified Assistance
- Palestinian American Medical Association
The mainstream or leftstream and liberal media barely covered this lawsuit. The Wall Street Journal and FOX did.
One 2010 article in Politico found the right kind of Jew, former IRS Commissioner, Sheldon Cohen who said, "he was skeptical of Z Street's motives in its high-profile lawsuit, rather than pursuing its concerns in tax court. 'They were hardly into the process when they screamed rape – nobody lifted the dress yet,' he said, noting that 501(c)3 groups can't advocate for political positions.
Seven years is a long time to be unable to raise funding for educational purposes; it is also a long time in which to launch and maintain a self-defensive lawsuit, one which was immediately punished by the IRS which then froze the Z STREET application. Seven years is a long time to experience the absence of Jewish-American organizational support; the turned backs of Jewish philanthropists is another kind of sorrow and challenge.
Marcus is a hero.Her website is here. Her summary of the Consent Order is here.
After I called Lori to congratulate her, she agreed to an interview. Here it is.
Q: Who, if anyone, helped you during your seven year battle?
A: We never could have afforded the seven-plus years of litigation, but luckily my husband and I are lawyers and did the vast bulk of the work. Two law firms graciously helped out as local counsel in Washington, D.C. There were a few in the non-mainstream media who paid attention to our case, and that was extremely helpful. Some smaller pro-Israel organizations such as EMET and AFSI, were very supportive. Most helpful of all, the Wall Street Journal wrote editorial after editorial as it followed our case, and Fox News also covered it at various points.
Q: Who, besides the IRS, opposed, ostracized, or threatened you?
A: Nobody threatened us, but some organizations - including some Jewish ones and even pro-Israel ones which we expected to be supportive - were either silent or distinctly unhelpful. For some reason no one in Congress, not even ostensibly pro-Israel folks on either side of the aisle, were helpful. We were just too small to matter to them, I think.
Q: What have you lost in this battle?
A: A great deal of emotional energy, personally. For the thousands of ardently pro-Israel individuals around the world who rallied 'round when we launched, a strong voice of ardent but accurate Zionism was lost.
Q: How do you feel now that you’ve won this battle for transparency, truth, and justice? Do you believe that this will set a precedent for other conservative or pro-Israel organizations who have been fighting for not-for-profit status?
A: I believe that had we not fought this battle many more pro-Israel organizations would have been hindered by the IRS. There was a repeated effort during the Obama administration to bar organizations that support Judea and Samaria from being eligible for tax-exempt status. There was a reason the IRS fought so hard for so long and with so many resources to keep us quiet. I have heard from other pro-Israel organizations in recent years that they believed their applications were treated swiftly and fairly because we made things difficult for the IRS and because we refused to fold. I am sure that had we not fought back through our lawsuit, the effort in the State Department and the IRS would have become a full-fledged policy.
Q: Have you heard from anyone in the new administration? If so, who and what did they say if anything?
A: I believe our case was finally settled, and the Department of Justice lawyers agreed to the admissions it did, because of the fairly recent entry of new lawyers at the administrative level with oversight for the IRS. I very much doubt ours and the Tea Party cases would have settled had this new administration not been in office.
Q: What are you planning or at least hoping to do now?
A: I'm hoping Z STREET will again be a voice for ardent and accurate Zionism. There is so much to do, and comparatively so few voices unabashedly raised in support of Israel. I hope people will come to our new website, ZSTREET.ORG - we had to shut down the one we had because of lack of funding - and share their views and amplify ours.
Q: What else might you want to say?
A: The legal process is an unwieldy, awkward tool for correcting injustice, but sometimes, if you stick to it long enough, it actually works!
Lowenthal-Marcus' recent article on the lawsuit appeared in the Wall Street Journal
Dr. Phyllis Chesler, a Shillman-Ginsburg Fellow at the Middle East Forum and recipient of the 2013 National Jewish Book Award, is the author of sixteen books, including Women and Madness, Woman's Inhumanity to Woman, and The New Anti-Semitism. She has written four studies about honor killing, Her latest books are An American Bride in Kabul, (Palgrave Macmillan) and Living History: On The Front Lines for Israel and the Jews.Professor Chesler may be reached at her website www.phyllis-chesler.com
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