Posted on 12/15/2017 10:15:35 PM PST by Oshkalaboomboom
The ethanol lobby is talking tough and issuing ultimatums to the Trump White House. Its message, in brief, is “Don’t mess with our federal mandate.”
If the White House wants credibility in its free-enterprise talk and promises to drain the swamp, it should tell the ethanol lobby to get lost.
The fight began because refiners are finding it increasingly unaffordable to comply with the federal ethanol mandate, and if it continues it might kill independent oil companies. The office of Sen. Chuck Grassley, R-Iowa, came to the White House on Wednesday and sought to dictate terms, telling the executive it could provide whatever relief it chose to those independent refiners, but it mustn't touch the mandate, officially called the Renewable Fuel Standard.
The ethanol lobby is formidable and used to getting its way. Grassley is one of the most seasoned lawmakers and a tough negotiator. His Iowa colleague Sen. Joni Ernst is fighting for the mandate too.
It's sometimes hard to tell where these Iowa senators' offices end and the ethanol lobby begins. Washington Examiner commentary writer Philip Wegmann reported last week on two Republican staffers, one from Grassley’s office and one from Ernst’s, cashing out to become the top lobbyists at the National Biodiesel Board and Green Plains ethanol company, respectively. That was just last week.
This network of lobbyists, combined with Iowa’s king-making position as the first state to pick presidential nominees, are the only reasons the ethanol mandate exists. It is economically, environmentally, and morally indefensible. But it's a political slugger.
Driving ethanol production artificially high raises costs for ranchers, strains water supplies, exacerbated a tortilla crisis in Mexico, ruins motorcycle engines, shortens the lifespan of lawn mowers, creates headaches for boat owners, increases smog, and distorts markets. What's not to love?
Absent the mandate, ethanol would enjoy some demand and be economically viable in a limited market. The mandate is a typical Washington overreach removing consumer choice and rewarding special interests. It's unconservative and unconscionable.
It's lobbyists' proposal to relieve independent refiners is more of the same. Some suggest a special accommodation for small refiners. Or maybe, the ethanol lobby proposes, Congress or the Environmental Protection Agency should create a special carveout from pollution standards just for ethanol — the industry already enjoys special benefits in fuel economy standards — that would boost ethanol production and thus lower the cost to refiners. The audacity of subsidy sucklers is a thing to behold.
Creating more carveouts and subsidies to pay off the victims of a heavy-handed federal boondoggle doesn’t count as draining the swamp. Rather than subsidize ethanol and small oil companies, or require ethanol and give it special exemptions, we propose the simpler fix of killing the Renewable Fuel Standard.
Many businesses have invested in the RFS and they shouldn’t have the rug pulled out from under them, so we propose that the RFS be phased out over five years, as proposed by Sen. Ted Cruz, R-Texas, in 2015. Reduce the mandated level by 20 percent each year until it hits zero. The original legislation didn’t prescribe any level of renewable fuel past 2022 anyway, so there was no reasonable expectation of government support in the long run.
President Trump’s best message when he was a candidate on the campaign trail was that Washington was bought and paid for by special interests. He can live up to his promises by telling one of the most formidable special interests to make it on their own without taxpayer largesse.
Agreed...let’s eliminate all “mandates” and subsidies. Let FREE enterprise, supply & demand and markets determine the most efficient ways to produce MAXIMUM WEALTH for our Republic. The free farmers of Iowa will adjust and become more wealthy as they pursue other crops and endeavors. And the NATIONAL economy will grow, become more efficient and produce greater wealth at less cost.
The science and agriculture behind this needs to be understood.
Special corn is used to brew fuel ethanol, which is not suitable for either animal or human food. Could other things use the land better? Maybe. But we aren’t taking any edible corn, such as what tortillas are made out of, and putting it in gas tanks.
That said, most certainly let freedom ring. Let greenies sell what they believe to be green virtue to willing purchasers.
Only politicians would think something that costs $1.50 to make a $1.00 product. That is smart business in DC.
It got the frisson of environmental concern going that has now opened up into our modern global warmism / anthropogenic climate change worries.
He who robs Peter to pay Paul always can count on the support of Paul.
Candidate Cruz was the surprise winner in the Iowa Primary, while running against ethanol subsidies. It can be done.
Even the greenies don’t like ethanol in gasoline.
The amount of energy used to produce the corn is never recovered. Besides that it actually lowers your gas mileage
Ethanull
No, but we are taking land and growing this corn on it, instead of the varieties of other grains that used to be grown there that are food, reducing the supply even as demand grows, but not nearly as fast as the government-mandated demand for the ethanol.
As a result, once common feed grains are sky high and often not even available.
Agree100%
Let the sobs build ethanol power plants!
scam, plus it pollutes groundwater more than straight gasoline. plus straight gas has more energy per gallon than ethanol gas, meaning better fuel economy if you take ethanol out. plus small engines wont suffer damage with straight gas.
all these known benefits but govt doesnt do the right thing.
“Could other things use the land better? Maybe.”
You seem to forget that what is mandated by the greenies in California is (because of the economies of scale) ‘mandated’ for the rest of us.
Ethanol ruins small engines, lowers auto miles per gallon, and takes more energy to produce than it creates, while decreasing the amount of food available, raising the price of dairy and other foods, increasing the price of gas - with all its ‘special’ and seasonal blends.
This is a case of the few - greenies, and corporate farmers in Iowa - dictating how the rest of us live our lives, what we eat, and how much we pay for it. That is NOT the sound of freedom ringing.
“Special corn is used to brew fuel ethanol, which is not suitable for either animal or human food. Could other things use the land better? Maybe. But we aren’t taking any edible corn, such as what tortillas are made out of, and putting it in gas tanks.”
Ethanol mandate has indeed raised the price of grain based products; including meat. No doubt about it. And, ethanol is not environmentally friendly as it gets less mpg than straight gasoline. And, the waste from these ethanol breweries finds its way into the water system and has migrated all the way into the Gulf of Mexico causing huge dead pools. But, the only way to kill this good intended gone bad idea is to kill all subsidies such as those for carbon based fuels, wind, solar, you name it. Let the free market prevail. Whoo Hoo!!!!
The swamp just keeps refilling itself (with ethanol?!?):
https://hotair.com/archives/2017/12/13/not-shocking-grassley-aide-lands-plush-ethanol-lobbying-gig/
+1 Bottom line for human survival, DON’T BURN YOUR FOOD, yes I’m yelling
Ethanol has been in the mix since the beginning. So has biodiesel. Henry Ford was calling ethanol the fuel of the future in the 1920's. Rudolf Diesel ran his first engines on peanut oil. And not to forget: in the early days there were steam powered cars and electric cars as well. Petroleum based fuels came to dominate because oil turned out to be far more abundant than anyone expected. This, by the way, has not been a good thing. Too much of the cheap oil turned out to be located in the middle east, where oil dollars have fueled all manner of evils, as well as various other third world hellholes where oil has been the high road to massive corruption. But that's another story.
The current U.S. ethanol policy is rooted in the decade following the turn of the century. After the first Gulf War, oil crashed as low as $12 a barrel before stabilizing around $20 for most of the 1990's. Cheap oil was one of the several things that Bill Clinton got very lucky about. In the next decade, however, the soaring U.S. and global economies drove oil steadily upwards, approaching $150 a barrel before the 2008/09 crash. Had you told me at the beginning of the decade that the U.S. economy would shrug off oil at $80, $100, and $120 a barrel and keep doing fine, I'd have thought you were crazy. But that's what happened, largely because the effects of the digital revolution were so dominant that they carried a lot of baggage.
During that huge runup in oil prices, the U.S. decided to finally get serious about finding a way to diversify away from oil and ultimately transition to a successor fuel. The candidates were, and still are, biofuels, electric cars, and fuel cells. Then came the 2008/09 crash and a global slowdown that depressed oil prices. And then came fracking, and another shift in the economics of oil.
But oil is still a finite resource, subject to depletion and big price shocks due to the still-dominant role of very nasty places in its global production. Fracking has bought us time. How much, I don't know. But the strategic question is this: do we keep our eyes on the ball and continue to explore alternatives, or do we think short term and scuttle the alternatives for another temporary binge on cheap oil?
The Bush administration was pro-everything on energy: pro-drilling, pro-nuclear, pro-biofuels, fuel cells and electrics, pro-wind and solar. The argument was over how much to subsidize close-to-commercial alternative energy sources. Biofuels took off once oil prices rose above $80 a barrel, making corn ethanol competitive without subsidy. The blenders tax credit has been repealed; the mandate is still in place to force the oil industry, which controls the refining, to accept a competing fuel instead of locking out the competition. Wind is also close enough to a competitive price point that a relatively small subsidy has gotten us a big buildout of wind capacity. (My objection to wind is esthetic, not economic: miles of windfarms are space consumptive and ugly.) Solar has come way down in price and is carving out increasing non-subsidized markets for off-grid applications, but it is still not close to competitive against the grid. That could change quickly, however.
The Obama administration took a big step backwards. It was operationally anti-everything on energy except wind, solar, and electric vehicles. We should revert to the Bush policy. The goal is not simply energy independence; the goal is breaking OPEC, making the jihadis fight with sticks and stones because they can't afford bullets, making the Saudis close down their global madrassah poison because they can't afford it, etc. Fracking has bought us time. We shouldn't waste it.
This is not just an Iowa or an ethanol problem.
We are in a good place right now despite Washington DC. We are where we are because of free market innovation.
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