‘Ethanol Is Not a Reliable Path to Ensuring Iowa’s Future Economic Success’

by Greg Pollowitz

The editors of the Daily Iowan, newspaper for the University of Iowa, write:

The Associated Press made a splash with its investigation into corn-based ethanol in the United States last week, and now it has the whole industry up in arms over the findings.

The AP reported that farmers contaminated local water, eradicated wildlife habitats, and destroyed substantial tracts of conservation land in the rush to raise more corn that could be sold to ethanol plants. Not exactly flattering. And definitely not something the ethanol industry wants everyone to know about, which may explain the Renewable Fuels Association’s Geoff Cooper’s statement to reporters that “We find it to be just flabbergasting. There is probably more truth in this week’sNational Enquirer than AP’s story.”

Clearly, the industry is wildly panicked. And it should be. On Nov. 15, the Environmental Protection Agency, noting that biofuel legislation passed in 2007 has not been working as well as hoped, proposed reducing the amount of ethanol in the national fuel supply. By 2014, it would cut 3 billion gallons of biofuels that are blended into gasoline.

This will inevitably mean losses for Iowans. A map from Iowa Workforce Development shows that there are numerous ethanol plants scattered around the state, providing thousands of jobs, many of which are in small towns that have been shriveling up for decades.

Don Hofstrand, the codirector for Ag Marketing Resource Center, explained in a newsletter that Iowa’s corn farmers also benefit from ethanol because it drives demand for corn, raising prices and ultimately increasing profits.

As promising as it may seem at first glance, ethanol is not a reliable path to ensuring Iowa’s future economic success. We say this knowing fully that a move away from ethanol would not bode well for much of rural Iowa in the short term, but if the state economy remains heavily invested in ethanol, we will get hammered the instant something goes wrong. And in volatile industries such as oil and corn, that is only a matter of time.

The rest here.

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