What was that about “tax exempt status”?

Last Friday, as the House and Senate were working out their differences over legislation to stop the removal of Terri Schiavo's feeding tube, embattled House Majority Leader Tom DeLay discussed the issue at a gathering of the Family Research Council at the Willard Hotel in Washington. In the speech, he drew parallels between Schiavo's situation and his own as he faces a barrage of ethics allegations, and he implicitly asked the conservatives to come to his defense as they have Schiavo's. A recording of the speech was supplied to TIME by Americans United for Separation of Church and State, an advocacy group:

(Excerpt from Time article)

"You know, one way they stopped churches from getting into politics was Lyndon Johnson, who passed a law that said you couldn't get in politics or you're going to lose your tax-exempt status, because they were all opposed to him when he was running for President. That law we're trying to repeal. It's very difficult to do that, but the point is, when they can knock out a leader, then no other leader will step forward for a while, because they don't want to go through the same thing. If they go after and get a pastor, then other pastors shrink from what they should be doing. It forces Christians back into the church. That's what's going on in America. The world is too bad and I'm going to get inside this building and I'm not going to play in the world. That's not what Christ asked us to do.

"And so they understand that. It is a political maneuver, and they are going to try to destroy the conservative movement, and we have to fight back, so please, this afternoon, each and every one of you, if you know a senator, give them a call. They'll say our bill can pass in the House. Tell them, okay, your bill is fine, but the House bill is better, and I want the House bill. Particularly if you know Democrats. Don't let them get off the hook by hiding behind one House and the other is adjourned. We can do anything we need to do to pass any bill that we need to pass."