

Mike "The Situation" Sorrentino has been indicted on charges of tax evasion. (AP/Julio Cortez)

If they end up voting for it, lawmakers in both parties will have put into law a proposal to fund most of the government through September that reduces the budget for the Internal Revenue Service by $346 million, or about 3 percent. This is deeply counterproductive.

When the IRS doesn't have enough money to conduct audits of tax returns, it's easier for cheaters to get away without paying their fair share. Extra money spent on enforcement is well worth it from the perspective of the country's bottom line. By one estimate, every dollar cut from the IRS budget increases the deficit by roughly $7. It's free money. Congress is throwing it away, choosing instead to increase the budget deficit and national debt at the expense of people who are playing by the rules.

The bill also attempts to address the controversy over the way the agency has handled the tax status of liberal and conservative political groups by forbidding the IRS from targeting any group for scrutiny based on ideology. If that provision passes, it is not clear how exactly the agency is supposed to enforce the law granting tax-exempt status to certain political organizations but not to others -- which is the ambiguity that got the agency in hot water in the first place.

But however you feel about the tax status for political groups, that controversy has nothing to do with the IRS budget, which Congress has been steadily reducing since way back in 2010.

Welcome to Wonkbook. To subscribe by e-mail, click here. Send comments, criticism or ideas to Wonkbook at Washpost dot com. Follow Wonkblog on Twitter and Facebook.

What's in Wonkbook: 1) The Cromnibus 2) Opinions, including Ignatius, Hayes and Friedersdorf on torture 3) Insider trading cases thrown out 4) The NFL's personal-conduct policy, treating depression with Special K and more

Number of the day: 5 trillion. That's a conservative estimate of the number of pieces of plastic floating in the world's oceans. Chris Mooney in The Washington Post.

Chart of the day:

The Organization of Petrolem-Exporting Countries is being pulled apart by declining demand on the one side and rising supply from states outside the cartel on the other. Tomas Hirst in Business Insider.

1. A lot of things are in the Cromnibus



Liberals are revolting over a revision of Dodd-Frank. The financial reform law forbid banks from trading derivatives with funds protected by federal deposit insurance. The Cromnibus would eliminate that ban for what supporters say are the safer, less complex derivatives, but Sen. Elizabeth Warren (D-Mass.) and other liberals don't buy that argument. Lori Montgomery and Sean Sullivan in The Washington Post.

Primary source: The bill. We skimmed it so you don't have to. Ed O'Keefe in The Washington Post.

Another provision allows employers to reduce pensions for current retirees. The change applies to pensions in industries such as trucking and construction where a group of firms share a single pension fund for their employees, which cover about 10 million workers. The AARP is upset, but many union leaders feel that something has to be done or else these funds will go under. Michael Fletcher in The Washington Post.



The campaign-finance provision would "fundamentally alter" how candidates get their money. A tenfold increase in the amount that wealthy donors can give to the political parties would shift the focus of fundraising from individual candidates and outside groups to the central party apparatus. No one seems to be entirely sure who drafted the language. Matea Gold and Tom Hamburger in The Washington Post.

BERNSTEIN: Returning money to the parties is actually a useful reform. Giving the parties more control would increase transparency and accountability, since outside groups often don't have to disclose their donors. Bloomberg.

Less money will be dedicated to Pell grants. Instead, the money will be used to ensure that the contractors who service student loans for the Department of Education can be paid on time -- but the Pell program could be confronting a shortfall of its own in a few years. This provision was advanced by Democrats. Danielle Douglas-Gabriel in The Washington Post.

And school lunches will be allowed to include fewer whole grains and more salt. The changes to the school-lunch program were seen as a rebuke to First Lady Michelle Obama, who has advocated for healthier meals in schools. Republicans have called the standards an overreach, and many kids say they won't eat the lunches their schools now serve. Mary Clare Jalonick for the Associated Press.



On the subject of nutrition, the potato lobby scored a victory. White potatoes, which are notoriously unhealthy for such an innocuous vegetable, have not been included in the nutritional program for Women, Infants and Children. Now they will be (at least for a while -- it appears that the administration will be given the authority to overrule this decision after a review). Fredreka Schouten in USA Today.

Oh, and then there's the provision on weed in the District. The bill would defund marijuana legalization, but what exactly that means is stupendously unclear. Halting enforcement would save money, and marijuana is already and would remain illegal under federal law. Elaine Teng in The New Republic.

The bill looks likely to pass, despite defections in both parties. Democrats are upset about several of the riders just mentioned, while Republicans are upset that the bill does nothing to undermine Obamacare or the president's reprieve from deportation for millions of undocumented immigrants. Mike Lillis and Rebecca Shabad in The Hill.

This kind of legislation could become typical in the new Congress. There are other major deadlines approaching next year, and lawmakers will be able to insist on all kinds of riders as a part of each compromise. "If liberal Democrats vote for this package it shows that conservatives can use must-pass legislation to repeal the regulatory state," one G.O.P. aide said. Peter Schroeder in The Hill.

Music interlude: Maddie and Tae's single "Girl in a Country Song," mocking the suffocating masculinity of country music, has hit No. 1 on the charts. "Well I wish I had some shoes on my two bare feet," the song begins, and it gets better from there. Emily Yahr in The Washington Post.

Listen here.

2. Top opinions

Don't homogenize health care. Insurers, hospitals and policymakers are trying to force doctors to adopt best practices in treating patients to save money and lives. The problem is that we don't always know what is best, or what might be best for a particular patient. Sandeep Jauhar in The New York Times.

IGNATIUS: The torture report gave lawmakers a pass. "A more honest report would have squarely faced the arguments made by former CIA officials that key members of Congress were informed about interrogation practices and, far from objecting, condoned the very CIA activities we now judge to have been wrong." The Washington Post.

COLLINS: The CIA's manual was written by a pair of charlatans. The two contractors, former military psychologists knew how to train pilots to withstand torture, but they had no idea how best to extract true and useful information. The New York Times.

CHAMPION: The report is a testament to U.S. diplomatic influence -- and how we squandered it. "It's an open question whether soft power can survive being used to such grotesque ends. One of the many reasons for which the torture program was a terrible idea was that once exposed it has deeply damaged the U.S. brand and thus eroded U.S. alliances: Forced rectal feeding just isn't something that most people associate with the values of life, liberty and the pursuit of happiness." Bloomberg.

HAYES: Does the United States remain "a nation of laws"? Whether it's torture, police homicides or massive bank fraud, some crimes that cry out for justice receive none depending on who the perpetrator happens to be. MSNBC.

FRIEDERSDORF: CIA director Michael Hayden -- of all people -- insists on due process. CIA officers feel they weren't given a chance to present their side of the story. Neither were 26 of the people they tortured without evidence, some of whom were later discovered not to be who the CIA thought they were. The Atlantic.

3. Insider trading cases thrown out

A federal court has clarified the definition of insider trading. The Second Circuit overturned convictions for two traders because the government did not prove that the information they were using had been divulged in exchange for a reward. Christopher M. Matthews in The Wall Street Journal.

Primary source: The opinion.

The decision is a major rebuke to Preet Bharara. The U.S. attorney in Manhattan was undefeated in dozens of insider-trading cases and a reputation as a prosecutor with the ability and inclination to restrain Wall Street. Michael Rothfeld and Susan Pulliam in The Wall Street Journal.

LEVINE: The Second Circuit blows its top. Its blunt, scathing opinion will have consequences for several other prosecutions. Here's the gist: "Now, if you trade on a tip from a corporate insider, you're not guilty of insider trading unless the tipper actually got some personal benefit in exchange for the tip. That was always notionally the law, but now it's actually the law." Bloomberg.

MATTHEWS: Legalize insider trading. Insider trading only harms people who shouldn't be trading in the first place. And if stock prices reflected more about what was really happening inside corporations, we'd know about frauds years in advance. Finally, the law distorts the market since it is asymmetric: It's perfectly legal to decide to hold a stock based on inside information, but illegal to buy or sell it. The Washington Post. 7/26/13.

4. In case you missed it

Finding doctors could get harder for Medicaid patients. Language in the Affordable Care Act will reduce Medicaid compensation for primary-care doctors by 43 percent next year, according to a new study. Jason Millman in The Washington Post.

Employers will have to raise wages, but they don't know it yet. Employers are advertising openings, but can't fill them -- possibly because they haven't yet realized that they need to offer to pay more to attract applicants, now that fewer people are unemployed and looking for work. Neil Irwin in The New York Times.

Democrats are launching an ALEC clone. "We've ceded the states, in terms of policy and politics, to Republicans for a full generation now," one Democratic strategist acknowledged. The State Innovation Exchange, Democrats' effort to amend that deficiency in local policymaking, meets in Washington for the first time this week. Julie Bykowicz for Bloomberg.

Could a club drug treat depression? Ketamine, more commonly known as Special K, can treat depression in hours, clinical trials suggest -- but the drug also causes out-of-body experiences, and the long-term effects of treatment are unknown. Andrew Pollack in The New York Times.

The NFL has a strict new personal-conduct policy. With the announcement, Roger Goodell seeks to make amends for what he sees as his mistakes in dealing with players' violent behavior. "I blew it," he said in one of several interviews. Monica Langley in The Wall Street Journal.