Jim McTague‘s latest “D.C. Current” column for Barron’s ponders the possibility that the IRS scandal will turn into the Obama administration’s version of Watergate.

President Obama is taking his time in naming a replacement for longtime friend Eric Holder, who resigned Sept. 25 after six years as U.S. attorney general. A White House official says don’t expect a name until after Nov. 4, “so that this nomination does not get mired in election-year politics.”

Obama’s nominee is guaranteed to be a red-hot potato best left in the oven temporarily, lest he or she scorch Democrats currently engaged in uphill midterm election battles. You can bet that Republicans will demand that Obama’s pick say whether he favors appointment of an independent counsel to investigate what looks like an IRS dirty-tricks campaign against the Tea Party before the 2012 presidential election. The IRS, beginning around 2010, held up applications by Tea Party groups seeking tax-exempt status as social-welfare organizations. Tea Partiers allege that the agency, at the urging of the White House and Senate Democrats, wanted to prevent them from raising money for ads opposing Obama policies. The White House blames the situation on a screw-up by ill-trained employees.

“The administration and its fronts in the Senate accomplished what Richard Nixon wasn’t able to accomplish, which was the suppression of an entire movement against him. That’s how you steal an election; you make sure your political opponents can’t open an office,” says Tom Fitton, president of Judicial Watch, which is suing the IRS to obtain documents related to the controversy. Fitton has said the IRS continues to withhold documents and that a federal judge is set to determine if the group can be granted limited discovery to advance their release. …

… THE FBI IS INVESTIGATING THE IRS, but its neutrality is questionable. In 2010, the IRS pressed the FBI to investigate Tea Party groups and provided the bureau with 1.1 million pages of tax data on 12,000 returns—including 33 with confidential information. The FBI claims it never used the data and returned it upon learning of its confidential nature. But the FBI did little to reassure the public of its impartiality when, in January, it told The Wall Street Journal that no criminal charges would be filed, because it had concluded that mismanagement, not political conspiracy, was the culprit in the Lerner incident. Says Fitton: “It strikes me that Holder was required to appoint a special counsel, given the real conflict of interest that his lawyers and his agencies have exhibited.”

Remember Watergate? This IRS scandal has a similar aroma, which explains the foot-dragging on Holder’s replacement.