Criticizing Israel? Nonprofit Media Could Lose Tax-Exempt Status Without Due Process

Sen. John Cornyn, R-Texas, speaks during a news conference in the U.S. Capitol on March 21, 2024. Photo: Bill Clark/CQ Roll Call via AP Images

It doesn’t take much to be accused of supporting terrorism these days. And that doesn’t just go for student activists. In recent months, dozens of lawmakers and public officials have, without evidence, insinuated that U.S. news outlets provide material support for Hamas. Some even issued thinly veiled threats to prosecute news organizations over those bogus allegations.

Their letters were political stunts. Prosecutors would never have been able to carry their burden of proof under anti-terrorism laws, and all the pandering politicians who signed the letters knew that. But next time might be different, especially if nonprofit news outlets, such as The Intercept, manage to offend the government. 

That’s because a bill that passed the House with broad bipartisan support in April — after which a companion bill was immediately introduced in the Senate — would empower the secretary of the Treasury to revoke the nonprofit status of any organization deemed “terrorist supporting.” This week, the bill’s Senate sponsor, Sen. John Cornyn, R-Texas, introduced it as an amendment to must-pass legislation to renew the Federal Aviation Administration’s authorities. While it didn’t make the cut (the Senate didn’t vote on any of the dozens of proposed amendments), it’s likely to make its way to the Senate floor in another form soon.

Funding terrorism is already illegal, but the new bill would let the government avoid the red tape required for criminal prosecutions or official terrorist designations.

You might think actionable support of terrorism is limited to intentional, direct contributions to terror groups. You’d be mistaken. Existing laws on material support for terrorism have long been criticized for their overbreadth and potential for abuse, not only against free speech but also against humanitarian aid providers. A recent letter from 135 rights organizations opposing the bill highlighted efforts to revoke the tax-exempt status of, or otherwise retaliate against, pro-Palestine student groups.

There’s no reason to believe the press is exempt from overreach. In their recent letters, elected officials called for terrorism investigations of the New York Times, Reuters, CNN, and the Associated Press, relying on allegations that those outlets bought photographs from Palestinian freelancers who covered Hamas’s October 7 attacks.

The feigned outrage originated with a spurious accusation, from an organization ironically calling itself HonestReporting, that those pictures evidenced that the photographers who took them had advance knowledge of the massacre. Otherwise how (other than, say, TV or the internet) would they have known where to go?

HonestReporting then reasoned that the news outlets that bought the pictures may have been in on it as well — because, of course, when an international news giant buys a picture from someone on its vast roster of freelancers, it’s reasonable to impute the freelancer’s alleged sins all the way up the chain.

HonestReporting eventually walked back that convoluted theory, admitting it had no evidence and was merely asking questions. After forcing the news outlets to publicly deny having ties to Hamas, HonestReporting said it believed them.

But that didn’t stop U.S. officials from surmising that the fact some Palestinian freelancers in Gaza had contacts with Hamas officials — which should not be surprising, given that Hamas is the governing authority in the besieged enclave — made anyone who hired them terrorism financiers.

And it gets even worse. One of the letters — signed by over a dozen state attorneys general — floated the theory that the outlets’ reporting could itself evidence support for Hamas. As the U.S. Press Freedom Tracker (another nonprofit news site, operated by Freedom of the Press Foundation, where I work) put it:

The letter also highlighted that “material support” for terrorist groups — both a federal and state crime — can include “writing and distributing publications supporting the organization.” It did not elaborate on what would be considered support, potentially chilling any reporting that does not unequivocally condemn Hamas or unilaterally support Israel.

The attorneys general then warned the outlets that they would “continue to follow your reporting to ensure that your organizations do not violate any federal or State laws by giving material support to terrorists abroad.” The writers continued: “Now your organizations are on notice. Follow the law.”

Many of those same attorneys general recently argued that “First Amendment speech and associational freedoms do not protect persons who provide material support” to terrorism. They failed to mention the Supreme Court’s skepticism that “applications of the material-support statute to speech or advocacy will survive First Amendment scrutiny … even if the Government were to show that such speech benefits foreign terrorist organizations.”

Members of Congress have set their eyes on news outlets as well. Sen. Tom Cotton, R-Ark., parroted HonestReporting’s disinformation in multiple letters, while 15 congressional representatives demanded that the news outlets provide information — potentially including source identities and communications — regarding the freelancers, threatening to issue subpoenas.

If there is any doubt about the nonprofit bill’s backers’ intentions, consider that five of its House sponsors also signed onto a letter to the Internal Revenue Service asking how it defines antisemitism and insinuating that the IRS should deny tax-exempt status to nonprofits that “promote conduct that is counter to public policy,” even if they’re not accused of supporting terrorism at all. 

Nonprofit news outlets are already struggling even without government harassment, but revocation of their tax-exempt status would be a death knell for outlets doing the kind of in-depth investigative journalism that is hardly ever profitable these days. The mere prospect would chill reporting, not only on Israel but also on U.S. foreign policy generally. And that’s not to mention the threat to nonprofit press freedom organizations that journalists depend on to protect their rights (including to not get killed in Gaza).

Unfortunately, this is just the latest piece of reckless, unnecessary “national security” legislation that puts the press at risk. Last month, President Joe Biden ignored civil liberties advocates and signed into law a bill that would allow intelligence agencies to enlist any “service provider” to help the U.S. spy on foreigners.

As Sen. Ron Wyden, D-Ore., explained, the law could “forc[e] an employee to insert a USB thumb drive into a server at an office they clean or guard at night.” And that office could easily be a newsroom, where journalists often talk to foreigners whose communications might interest U.S. intelligence agencies.

Is the government going to immediately start conscripting reporters to surveil their sources, or shutting down nonprofit news outlets that stray from the Israeli military’s narrative? Probably not. But history teaches that once officials are given the power to retaliate against journalists they don’t like, they inevitably will. The prospect of the Espionage Act and Computer Fraud and Abuse Act being weaponized against journalism was also once merely hypothetical — until it wasn’t.

And let’s not forget that the presumptive Republican presidential nominee publicly fantasizes about jailing and otherwise retaliating against journalists.

Those who claim a second Donald Trump term would mark the end of democracy need to stop passing overbroad and unnecessary new laws handing him, and future authoritarians, brand new ways to harass and silence journalists who don’t toe the line.

The post Criticizing Israel? Nonprofit Media Could Lose Tax-Exempt Status Without Due Process appeared first on The Intercept.