Unfair Dealing

In December 2009, when the New York Times reported on the Obama Administration celebrating its achievement in settling royalties claims by American Indian tribes against the U.S. Department of Interior for pennies on the dollar, the misappropriated royalties from the plaintiffs’ 56 million acres — administered by Interior under the Indian Trust Fund — were to be partially restored and distributed by year’s end. As presaged in a September 2005  Mother Jones article by Julia Whitty, it would turn out to be a bittersweet victory for Blackfeet warrior Elouise Cobell.

As noted in a December 2009 article at Indian Country Today,

The willingness to settle for $3.4 billion of the estimated $47 billion stolen by the U.S. government since 1887 reflected the desperate poverty of the plaintiffs as a class, as well as the realization that it was probably the best they could do given the American political system.

In December 2010, when the Obama Administration hosted the White House Tribal Nations Conference to celebrate its belated and half-hearted endorsement of the 2007 United Nations Declaration on the Rights of Indigenous Peoples, tribal leaders were hopeful that the attacks on American Indian governments — begun in 2004 by the Internal Revenue Service — would come to an end. Instead, less than two years since the tribal summit, the U.S. Department of Treasury has escalated its attack on tribal sovereignty, imposing discriminatory policy on tribal governments and their citizens.

In what is possibly the most callous and cynical follow-up imaginable to the settlement of Cobell, the IRS is now trying to tax the meager benefits received by the plaintiffs after generations of unimaginable suffering by them and their ancestors — some of whom literally froze and starved to death — while Interior and the oil and gas companies lived lives of luxury at their expense.

In this June 2012 testimony by the National Congress of American Indians to the Senate Committee on Indian Affairs, it is noted that,

In 2005, the IRS began an aggressive campaign to audit every Indian tribal government in the country and impose inequitable tax treatment on Indian tribes. In this effort, the IRS has frequently undermined longstanding principles of tribal sovereignty, tribal self-government and the federal trust responsibility and failed to respect the roles of tribal governments under the U.S. Constitution and the plain language of federal statutes.

Concluding its detailed testimony of unfair treatment of Indian tribes by the IRS, the National Congress of American Indians urged the U.S. Congress to rein in these abuses of federal authority. As observed in this testimony,

The timing of the IRS effort — to attempt to change the law regarding taxability of trust funds at precisely the time when the United States is finally making partial compensation for many decades of trust funds mismanagement — raises the implication of unfair dealing.

As James Warren observed in the June 2010 issue of The Atlantic,

The story turns on theft and incompetence by the Interior and Treasury Departments, with culprits including Interior’s Bureau of Indian Affairs (BIA) and the same Minerals Management Service now at the center of the BP oil spill fiasco…Government officials exploited computer systems with no audit trails to turn Indian proceeds into slush funds but maintain plausible deniability.

As U.S. District Judge Royce Lamberth, who oversaw the case for a decade, remarked, the whole matter is  “government irresponsibility in its purest form.”