When Al Gore drops an environmental fad, it has truly reached its expiration date.
In his wisdom, the Goracle recently acknowledged what almost all disinterested observers concluded long ago: Ethanol is a fraud. It has no environmental benefits, and harmful side effects. The subsidies that support its use are an object lesson in the incorrigibility of Washington’s gross special-interest politics. It is the monster that ate America’s corn crop.
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“It is not good policy to have these massive subsidies for first-generation ethanol,” the former vice president and Nobel Peace Prize recipient said, referring to corn-based ethanol. He called the fuel “a mistake,” and confessed one reason he fell so hard for it is that he “had a certain fondness for the farmers in the state of Iowa.” These farmers vote in the First in the Nation caucuses and practically insist that their favored presidential candidates drink ethanol at breakfast and hail it as the nectar of the gods.
Al Gore’s ethanol apostasy is a symptom of a left-right coalition that has arisen to expose the former wonder fuel. (The Gore of old insisted that “the more we can make this home-grown fuel a successful, widely used product, the better off our farmers and our environment will be.”) But common sense, even cross-ideological, bipartisan common sense with all the evidence on its side, is no match for Congress’s boundless appetite for expensive favors for powerful lobbies and constituent groups.
Tom Harkin and Chuck Grassley, the Democratic and Republican senators from Iowa respectively, stand at the doors of Congress declaring: Ethanol now, ethanol forever. They have graced the Obama-McConnell tax bargain with an extension of a tax credit for ethanol that costs about $6 billion a year, and with an extension of a tariff on ethanol imports. Ethanol is so uneconomical that Congress supports it three different ways — with a mandate for its use, a tax credit to subsidize it, and a tariff to keep out competitors. Rarely are so many levers of government used to prop up one woeful product.
During the past decade, ethanol enjoyed a good run as a notional part of the solution to global warming. Then, environmentalists began to realize it may actually increase greenhouse emissions. Ethanol releases less carbon dioxide per gallon than gasoline. Once the emissions necessary to convert land to corn production and then grow and process it are taken into account, though, ethanol doesn’t look so green anymore.
So much corn — about 40 percent of the U.S. crop — is feeding into the maw of government-created demand for the fuel, that it could be increasing worldwide food prices. In short, in exchange for not reducing greenhouse emissions, ethanol reduces the availability of food to the poor.
The multiple layers of subsidization have their own perversity. Since there’s already a mandate to blend ethanol into gasoline, the tax credit is giving away money for something that would happen anyway. Environmental groups say this pads the bottom line of Big Oil. Harry de Gorter of the free-market Cato Institute has a more complicated take — the subsidy decreases the cost and therefore the price of gasoline, effectively subsidizing its consumption. Your Congress at work.
But who cares about the facts? Once we have fired up a vast machine that from cornfield to distilleries produces 38 million gallons of ethanol a day, it will be nearly impossible to turn it off. Too many people will have a vested interest in continuing the scam, and its supporters — like Harkin and Grassley now — will always argue that any change is too disruptive. We’ll still be mandating ethanol long after the internal-combustion engine is obsolete.
Let us not forget that it's impossible to buy pure gasoline anymore and therefore, there's ethanol being burnt in a lot of engines that were never designed for ethanol. What is the environmental impact of shortening the lifespan of my weed whacker, lawn mower, leaf shredder, chainsaw, etc?
They'll never understand. Start a government welfare program, which is what this is, it's darned near impossible to stop it regardless of the damage it's doing to our economy.
When will they learn that government cannot control the means of production without having anything but problems?
Not all all "disinterested parties" believe ethanol production, even subsidized, is a mistake. Ethanol production has been "hijacked" by many groups: environmentalists, politicians of all stripes, and of course, the industry itself. Ethanol support had two goals. 1. Provide an alternative fuel source to reduce the impact of foreign supplied oil. 2. Provide a new market for U.S. grown corn products. The program has succeeded on both points. The 15 Billions of ethanol produced this year have a postive effect on oil price markets and provide a growing percentage of vehicle fuel requirements. The midwest farm economy has never been more robust. Increases in farm efficiencies, crop yields, and techniques to reduce fertilizer and pesticide use are secondary benefits from the ethanol expansion. Finally, the U.S. produces more food bound corn over the last years than less, so American food production is not threatened by ethanol product, rather the reverse.
According to Inhofe, it's negligible, and you shouldn't be mad about it, peon!
In all seriousness this is a horrible joke played on the American people for the benefit of a few lightly populated states. It represents how out of touch the government was and still is.
You'd think that in light of all the new evidence, this would be the first thing on the chopping block, but it's not.
Everyone who supports this deserves to be ridiculed and reviled at every possible opportunity, and Tea Partied out of office in the next election. No corn likker for my car!
Q: What do you call a politician in Iowa who doesn't support ethanol or any other farm subsidies for that matter?
A: I have no idea, but it's not "Senator" or "Congressmen".
Many Iowans understand the problems with these programs, but not enough to make a difference come election time.
Andy Anderson:
Even if we take all that you say as fact, then that still doesn't justify the subsidies or the continued support thereof.
I also seriously doubt what you state about corn production. Yes, maybe the food yields have gone up because of better practices, but something else had to give. In other words, either there was a whole lot of non-productive farm land out there, or farmers have switched from other crops. In either case, it's a bubble waiting to burst because of these subsidies.
Ethanol subsidies reduce the cost of ethanol-blended fuel, but only after the mandates and usage of ethanol in our fuel have already caused the price of fuel to increase more than the subsidy causes a reduction.
Requiring gasoline to be blended with ethanol adds layers of cost to the refinement of fossil fuel and its preparation into consumer products, which are then passed along to the consumer. Not to mention that the required formula of gasoline:ethanol ratios differ in all 50 states, which adds inefficiency and increased costs of transporting fuel to the consumer.
Then, along comes a subsidy that minimally lowers that increased cost. So, I guess I take issue with Harry de Gorter, not Rich Lowry.
Ethanol increases costs, and thereby increases prices, which are infinitesimally offset by a subsidy. Net increase.
Ethanol has failed on the first of its supposed "purposes": it has NOT AT ALL reduced the "impact" of foreign oil.
By impact, I assume you mean influence or its percentage of US market share. Given that ethanol use increases the use of fossil fuels, foreign fossil fuels are being used MORE now with ethanol production. So, ethanol mandates and subsidies have had the exact opposite effect as intended.
Shazam! Same holds true for welfare generally, not just agri-welfare.
What do you think powers the production of all this increased corn? Are farmers using 100% ethanol in their tractors? RIGHT!!
Look, when Iowa farmers run their tractors on 100% ethanol, and not diesel, then the environmental impact of ethanol might be positive and not negative. Then, I might (but not likely) support this IVWP - Iowa Voter Welfare Program.
At least then, it would have a benefit to society at large against all the detriments, and not just benefit the welfare recipients themselves.
As to purpose #2:
Why did we need "new markets" for US corn products? Was there an increase in demand for corn? You seem to freely admit that one of the main purposes of pushing ethanol down our gas tanks is to force an increased production and consumption of corn that no one was demanding in the absence of the mandate.
Why is that a good thing? The increased supply actually has had an upward effect on price of food, which is rare. Usually, if demand remains constant, but supply increases, then the price drops to encourage sell-off of the surplus.
Here, however, the government intervened to DEMAND increased consumption of corn for our vehicles. And it has caused food prices to permanently rise. Thanks. At least you tacitly admit that this is welfare we're talking about.
The cornstalk welfare queens in Iowa need to be weened from the government's teet. If they were stripped of the pleasure to vote first in the presidential primaries, the influence of these welfare addicts would diminish very quickly.
The sooner Iowans ween themselves off govvie teet milk, the better off we'll ALL be: with lower energy prices, lower transportation costs, and much lower food prices. And, reduction in emissions.
The only ones made worse off are all the people whose production was artificially inflated to begin with at everyone else's expense.
If ethanol subsidies are terminated, I have a teeny fiddle the size of a paper clip I shall play out of sympathy for the Iowa Voter Welfare Recipients.
One state should not make the other 49 beholden to a welfare program that benefits only one state.
Final recourse would be to tell the Iowa govvie teet suckers to secede from our Union and suck their own teets. Eradicating illogic sometimes calls for drastic measures. If we have one state whose residents are this utterly selfish, good riddance!
Welfare is welfare, Mr. Anderson, no matter how you dress it up in frills and fur coats to look like smart economic and foreign policy.
My personal boycott of corn has officially commenced, prompted by Mr. Anderson's full-throated support of agri-welfare bennies.
I shall eat substitutes - pinto and black beans, and sweet peas - until Iowans either ween or secede.
I favor your secession, BTW. Agri-welfare queens are the most difficult to potty train to live without them, since farmers have the strongest sense of entitlement. We should just cut our losses now, and save the hassle.
Another fact not mentioned here is that many of the excess products from the corn yield that used to be used as feed for cattle is not available when the corn is processed for ethanol. Alternative feed must be used for the cattle at an increased cost. So, the increase in ethanol production also leads to higher prices at the grocery store - and that's before factoring in the increased transportation costs.
Ethanol subsidies (or any other farm subsidies for that matter) Will never go away as long as Iowa has the first event in the caucus/primary season, because no presidential candidate can win Iowa without supporting subsidies and no candidate can win a nomination without Iowa. We should have all primaries on the same day, it's not right that the welfare queens disguised as Iowa farmers get a bigger say in the nomination process than taxpayers in the other 49 states.
Al Gore is an idiot. You can make up negative things to say all day on ethanol but if you don't have any facts, none of it realy matters. Ethanol is providing us with a renewable and domestic alternative fuel that burns 52% cleaner according to the EPA. It gives consumers a choice at the pump as to whether they want to continue supporting foreign oil or choose domesticly produced ethanol that provides for over 400,000 U.S. jobs. Last time I checked, we didn't need soldiers protecting corn fields. The amount of money the U.S. spendson foreign oil in one week is approximatley the same as what VEETC will cost the U.S. for one year.
Field corn has the potential to be used as feed for cattle, but then so also does the grass cut from millions of suburban lawns. The grass has the potential to be used to feed cattle. When greedy suburbanites begin to lower the cost of meat by lowering the cost of cattle feed by lowering the cost of hay by making hay from their lawns, I might agree that the price of food at the grocery store increases because corn is used for purposes other than food. No even then I would not agree.
Field corn is not a food until it is made into a food. Any person who tried to eat corn out of a combine bin would soon find that out.
Big Daddy Don Garlits: "Gasoline is for washing parts, alcohol is for drinking, and nitromethane is for racing." End the welfare for farmers and I will laugh as they cry like babies.
Again another government program. Multiply this by 10,000 programs and agencies and you can see where all of the productivity of this country is going. Politicians have talked about reducing the size of government 5 - 10%. If you insert sanity and real management, try 50% reduction in expenditures, positive growth, and a shrinking deficit.
As a farmer in MN and a user of ethanol (E50) I'd like to comment...
Ethanol in the beginning was mandated for use in the fuel supply as an oxygenate to help reduce pollution. It competed at the time with Methanol which was found to create some toxic chemical and was discontinued. Thats why ethanol exists today.
There are several issues you all bring up:
Ethanol destroys engines is not true. Pretty much all modern engines (even small engines) can handle the ethanol content of today's fuels (E10). For instance I have used E50 in my truck for years (70,000 miles) and have had zero issues. Everyone can say "oh, my fuel pump went out and the mechanic said it was because of ethanol." They don't know and are passing on their bias.
Ethanol gets a lower fuel economy is partially true. Ethanol has a lower energy content than gasoline - this is true. But it also burns differently in an engine and studies have shown that some engines get better fuel economy up to mixes of E40.
Food is replaced by fuel is not true. The majority of the corn crop is still used domestically as livestock feed. The ethanol distillation process produces a by-product which is still fed to livestock and in fact is produced now in large enough quantity that it is sold and exported overseas. Poor people (globally) will always starve regardless of the price of corn. That problem is more political/cultural than economical, - kind of like the "war on poverty". The bulk of the price of a box of corn flakes is based on the energy involved in the processing and transportation of that product. A box of corn flakes has ~$0.10 worth of actual corn so if that were to double it would be ~$0.20 - no where near the $4 cost of the total product.
The ethanol subsidies have been decreasing. In the last few years the subsidy has been reduced from $0.54/gallon to $0.45/gallon. This subsidy is actually paid to the blending refinery (typically an oil company) and is not actually paid to the ethanol processor or the farmer. (Ethanol is a commodity and is bought and sold as such.) This trend should continue and ideally I think it should. Phase out the subsidy and I think the industry would benefit from a better piece of mind from their potential consumers. (all the rest of your posts except 1 or 2 have a hatred of ethanol)
"If ethanol was a good product, farmers would use it in their tractors." This comment was written by someone who has no idea how engines work. Please buy a clue... If you can show me a farm tractor with a diesel engine that uses gasoline I'll happily give you an apology. And just to point out, farmers do tend to use soydiesel blends which also had their subsidies revoked and their industry has essentially shut down. (it was not as mature as ethanol)
So phase out the subsidies - just do it in a smart manner!!
I frankly don't care if it burns cleaner or not, and the arguments about corn not being food until it is fed to cattle are nonsense since that price rise propped up by the subsidies and mandates raises the cost of that steak on my table either way, not to mention the corn syrup in the barbecue sauce.
My problem is a basic one--subsidies that pick winners and losers in the marketplace based on politics are WRONG. Period. Taxing me to use my money to make my basic expenses HIGHER (food, fuel, whatever) is nonsense and unjust. We have plenty of oil and natural gas and the technology to get it and use it. Whaddya say we do that first.
Frankly, though I don't believe in this kind of meddling on principle--if we had simply put a 5 cent a gallon tax on gasoline that goes into a research fund to find efficient alternatives (something that we have NOT found yet, pax the solar and wind lobbies) to eventually replace the role of petroleum fuels in our lives, that would make MORE sense, both political and economic, than the ethanol nonsense.
And by the way--I recently replaced a car with the same exact model from a newer year. Same weight. Same everything.....except the EPA figures showed the newer, presumably more efficient and better car (about a 6 year jump) would get WORSE mileage. Why? Hey, it's a "flex fuel" vehicle, so they have to average into the EPA rating the lower mileage of ethanol blends. Some savings! Some environmental benefit! Something we don't need more of, that's for sure.
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