There is a double indignity to being on the receiving end of a bad lie. The insult of being served with obvious dishonesty is compounded by the liar’s presumption that you are stupid enough to swallow it.

Claims by the Internal Revenue Service that they’ve “lost” emails from Lois Lerner and a half-dozen other employees pertinent to the agency’s targeting of conservative groups represent just such dual scorn.

As is well known to anyone who runs a business – or, heck with it, anyone who’s rushed their laptop to a strip-mall repair shop – there is almost always some way to recover emails and hard drive data. This is especially true of networks with backup protocols and storage requirements, such as the IRS requires of the private entities and individuals they audit.

From the outset, the IRS has responded to this matter in ways they would never accept from taxpayers. Starting with Lerner’s absurd contention to Congress that she had done nothing wrong, followed instantly by her invocation of the Fifth Amendment, to the agency’s year-plus of stonewalling and prevarication in the face of legitimate inquiry, this ridiculous outfit has held itself to a lower standard than it demands of the citizens it purports to serve.

Now, with this laughably convenient lie, that the very emails Congress is requesting have somehow vanished into the bowels of Lerner’s Commodore 64, the IRS has defied satire to such a degree that it can never be taken seriously again.

Consequently, we who advocate the abolition of the IRS must continue to highlight its institutional dysfunction, rather than focus on a few individuals.

Inasmuch as this scandal is personalized, its potential as a catalyst for change is diminished. If, however unlikely, Lerner were to go to jail, or President Obama were to be directly implicated, a satiated public could suppose the responsible parties had been served their just desserts. But this problem is systemic, not personal. It is the bureaucracy itself that must be eviscerated.

Counterintuitive though it may seem, the incrimination of a president is small potatoes compared to the import and opportunity this moment provides. America’s decline is not a function of a particular chief executive, no matter how mendacious or incompetent. Rather, it is hastened by the nation’s ubiquitous and permanent bureaucracy, of which the IRS is emblematic.

Alas, it was inevitable that the IRS imbroglio and its attendant investigations should become partisan affairs. This is not because Republicans hope to take down Barack Obama as Democrats seek to protect him – this president has proved impervious to scandal, or even basic scrutiny – but because the bureaucracy and the left are one.

For all their self-labeling as agents of “progress” and “liberal” ideals, the left are guardians of ossified, statist, liberty-squelching systems across the globe.

Like the guy in the office who tries to give himself a nickname (“From now on, could I get you to call me T-Bone?”), they insist they’re about freedom and fighting for the little guy, even as they ensure he remains little.

It is axiomatic that the bigger a government gets, the smaller citizens become. This column has previously noted that in modern America, there is a tax consequence to every undertaking, literally from cradle to grave. In this way, the IRS is the vanguard of the nation’s regulatory juggernaut.

Little wonder, then, that the Democrats, the party of government, reflexively leap to the defense of the IRS, and left-leaning sympathizers roll their eyes at the suggestion of disbanding it, as though America could not survive without this malignant agency which has existed for less than half of the nation’s history.

But this has to be the last straw.

Yes, as the most officious, militant and corrupt tax authority in the world, the IRS maintains the threat of force against citizens. But that is all it has. How can anyone – left, right or indifferent – respect them again? Transparent dishonesty and blatant corruption have stripped the IRS of whatever legitimacy it once possessed.

What, then, to replace it with? Of the two most conspicuous alternatives – a consumption tax or a flat tax – the former is furthest from the current mandate of the IRS, thereby facilitating the outright dismantling of that hideous structure.

Remove taxation entirely from the realms of income, health, religion, speech, charity and the myriad other aspects of daily life infected by its touch. Under a consumption tax, when you buy something, you pay a tax on that transaction, and that is the end of your obligation to finance the federal government.

Critics refer to such a system with the deliberately provocative and misleading moniker of “regressive,” meaning it impacts rich and poor alike in equal proportion. Besides that a flat tax does precisely the same, the result of a consumption tax is that those who earn and spend more will be taxed at higher amounts. In this way, wealthier individuals and organizations shoulder a higher portion of the tax burden than those with less, and arguably a higher portion than they do under today’s so-called “progressive” system.

President John F. Kennedy, an aggressive tax-cutter, was fond of pointing out that the Chinese use two brush strokes to write the word “crisis”: one stands for danger, the other for opportunity. America is in crisis, prominently represented by the corruption of its tax authority. This is, however, an opportunity to change the country for the better.

Theo Caldwell is an investment advisor in the United States and Canada. Contact him at theo@theocaldwell.com.

