Ronald Reagan and Bob Jones University: An Interrelated History

May 30, 2023

Opinion: The same date, but a much different time

I love history. War and political history mostly. I especially love history told by primary sources. Primary sources make me feel like I am in the room when history’s being made. History is not discrete, its a continuum, and events we think about in isolation are more often intricately related. A case in point:

Olatunde’s 2010 article The Story of Bob Jones University v. United States: Race, Religion, and Congress’ Extraordinary Acquiescence, tells the fascinating back story to the Supreme Court’s reliance on “fundamental,” “established,” “clearly established,” “clearly defined,” “settled,” and “firm” public policy to deny tax exemption to racially discriminatory schools. She describes how Richard Nixon initially opposed the IRS’s efforts against Bob Jones University, but then changed course to support those efforts. Senator Walter Mondale labeled Nixon’s change of heart “theatre,” nothing more than a hoax. Senator Strom Thurmond said even if only theatre, any enforcement would be against God’s will. “My white daughter should not be forced or even allowed to go to school with my black daughter,” he added without the slightest hint of irony.

Through the Jimmy Carter years, the IRS strengthened its enforcement posture. But then the Iran hostage crisis came, Jimmy got kicked out and RINO (by today’s standards) Ronald Reagan hailed morning in America. Carter’s DOJ argued that Bob Jones University was not entitled to tax exemption, but Reagan scribbled “I think they should” be tax exempt in the margins of a briefing memo; Reagan soon instructed DOJ to switch sides in hopes the case would be dismissed. A constitutionalist despite whatever Oliver North was doing in Nicaragua, Reagan just couldn’t support IRS’ “usurpation” of legislative power.

Heads exploded at DOJ. But the Supreme Court’s itch — itching to get in the fight, that is — was scratched by a late arriving circuit split regarding whether the IRS was usurping by action, or abdicating by inaction. Ronnie tried one last time to moot Bob Jones before the Supreme Court issued an opinion that might go the wrong way. He wrote to Tip O’Neill and Vice President George H.W. Bush (in the latter’s capacity as President of the Senate) with proposed legislation that probably would have been filibustered to death anyway. Perhaps the Court would dismiss Bob Jones if it appeared Congress would soon act. The Court forged ahead with help from Thurgood Marshall’s litigating partner, Bill Coleman, whom the Court appointed to argue the disavowed Carter administration position. Coleman’s Philadelphia high school, by the way, disbanded its swim team rather than let him swim or compete in the same pool with white kids. Philadelphia, Pennsylvania not Philadelphia, Mississippi where the Klan and Philadelphia police officers murdered Chaney, Goodman and Schwerner for helping black folk vote. When the Carter administration position prevailed, Reagan withdrew the proposal, not quite moot but no longer effective for its dilatory purpose. I wonder what tax exemption jurisprudence would look like if Reagan had not withdrawn the proposal.

Olati’s telling made me want to see Reagan’s letter and proposed legislation — I heard the story in Steve Willis’ Exempt Orgs class at UF years ago, but I had never seen the primary documents. So I followed the footnotes and found Reagan’s letter and proposed legislation. The proposal, by the way, would have allowed religious institutions to continue discriminating against LGBTQ folk, as long as they discriminate against all races of LGBTQ folk alike. That must have seemed fair then and is still an asserted position today. Yeah, history is fun even if tragic. Check out the letter and the proposal below the fold.

darryll jones

File:White House Letterhead Seal.png - Wikimedia Commons

The White House

Washington

Hon. Thomas P. O’Neill, Jr.

The Speaker,

The House of Representatives, Washington, DC

Dear Mr. Speaker:

As you are aware, the Department of the Treasury announced on January 8 that the Internal Revenue Service would no longer deny tax-exempt status to private, nonprofit educational organizations that engage in racially discriminatory practices but otherwise qualify for such status under the present Internal Revenue Code. That decision reflects my belief that agencies such as the IRS should not be permitted, even with the best of intentions and to further goals that I strongly endorse, to govern by administrative fiat by exercising powers that the Constitution assigns to the Congress.

I share with you and your colleagues an unalterable opposition to racial discrimination in any form. Such practices are repugnant to all that our Nation and its citizens hold dear, and I believe this repugnance should be plainly reflected in our laws. To that end, I am herewith submitting to the Congress proposed legislation that would prohibit tax exemptions for any schools that discriminate on the basis of race. This proposed legislation is sensitive to the legitimate special needs of private religious schools.

I pledge my fullest cooperation in working with you to enact such legislation as rapidly as possible, and urge that you give this matter the very highest priority.

I have been advised by the Secretary of the Treasury that he will not act on any applications for tax exemptions filed in response to the IRS policy announced on January 8, until the Congress has acted on this proposed legislation.

I believe the course I have outlined is the one most consistent both with our mutual determination to eradicate all vestiges of racial discrimination in American society, and with a proper view of the powers vested in the Congress under our constitutional system.

I feel this legislative action is important to and desired by all citizens of this great Nation; I am confident that you will give this issue the prompt attention it deserves.

Sincerely

RONALD REAGAN

January 18, 1982

A BILL To amend the Internal Revenue Code of 1954 to prohibit the granting of tax-exempt status to organizations maintaining schools with racially discriminatory policies

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. DENIAL OF TAX EXEMPTIONS TO ORGANIZAITONS MAINTAING SCHOOLS WITH RACIALLY DISCRIMINATORY POLICIES

Section 1. 501 of the Internal Revenue Code of 1954 (relating to exemption from tax) is amended by re-designating subsection (j) as subsection (k) and inserting a new subsection (j) reading as follows:

“(j) Organizations Maintaining Schools With Racially Discriminatory Policies –

“(1) In general. – An organization that normally maintains a regular faculty and curriculum (other than an exclusively religious curriculum) and normally has a regularly enrolled body of students in attendance at the place where its educational activities are regularly carried on shall not be deemed to be described in subsection (c)(3), and shall not be exempt from tax under subsection (a), if such organization has a racially discriminatory policy.

“(2) Definitions – For purposes of this subsection –

“(i) An organization has a ‘racially discriminatory policy’ if it refuses to admit students of all races to the rights, privileges, programs, and activities generally accorded or made available to students by that organization, or if the organization refuses to administer its educational policies, admissions policies, scholarship and loan programs, athletic programs or other programs administered by such organization in a manner that does not discriminate on the basis of race. The term ‘racially discriminatory policy’ does not include an admissions policy of a school or a program of religious training or worship of a school, that is limited, or grants preferences or priorities, to members of a particular religious organization or belief: Provided, That no such policy, program, preference, or priority is based upon race or upon a belief that requires discrimination on the basis of race.

“(ii) The term ‘race’ shall include color or national origin.’