Politics & Policy

Trump’s Support for Ethanol Is Bad for Taxpayers and Their Cars

(Joe Raedle/Getty)

One of the most destructive environmental subsidies in the United States has found an enthusiastic supporter in Donald Trump.

“The EPA should ensure that biofuel . . . blend levels match the statutory level set by Congress,” he said yesterday in Iowa, adding that he was “there with you 100 percent” on continuing federal support for ethanol. “You’re going to get a really fair shake from me.”

The ethanol lobby has rigorously courted Trump since April, arranging to speak at least weekly, including at least three in-person meetings, in addition to an ethanol-plant tour, the Wall Street Journal reports.

Trump’s support for ethanol may win him votes in Iowa, but federal support for ethanol is a bum deal for Americans.

Under the 2007 Independence and Security Act, Congress mandated that the United States use 36 billion gallons of biofuels, including corn ethanol and cellulosic biofuel, by 2022.

And the federal government not only requires the use of ethanol; it also subsides it. Tax credits between 1978 and 2012 cost the Treasury as much as $40 billion. Moreover, numerous other federal programs, spanning multiple agencies, allot billions of dollars to ethanol in the form of grants, loan guarantees, tax credits, and other subsidies.

Taxpayers suffer in other ways, too. Vehicles can drive fewer miles per gallon using ethanol blends than they would with pure gasoline. So Americans end up spending an extra $10 billion per year for fuel, the Institute for Energy Research estimates.

Ethanol also guzzles 40 percent of the U.S. corn crop, and the resulting scarcity drives up the price of food. This year alone, the Congressional Budget Office estimated, American consumers will spend $3.5 billion more on groceries because of the ethanol mandate.

Rising prices of corn feed have even put some small feedlots and ranches out of business. And as grocery prices increase, so does federal spending on programs like the Supplemental Nutrition Assistance Program.

In a further hallmark of terrible policy, it’s probably not even possible for Americans to meet the ambitious ethanol goals Congress and the bureaucrats at the EPA have envisioned.

Ethanol-intensive fuel blends can wreak havoc on car, lawnmower, and boat engines. In fact, many vehicle manufacturers will no longer offer warranties when ethanol comprises 10 percent or more of fuel; engine erosion simply becomes too common.

So, we can’t really increase the total amount of ethanol mixed into our gasoline much more, but — especially as vehicles become more fuel efficient — Americans aren’t consuming enough gasoline to meet the Renewable Fuel Standards with a 10 percent ethanol blend. The EPA acknowledged this inconvenient mismatch last spring, setting three-year ethanol-use requirements at 3.75 billion gallons below the legal minimums.

Ethanol’s green benefit is also far from certain, explaining why even many within the environmentalist Left question — or outright oppose — the federal government’s support.

It takes about 29 percent more energy to refine a gallon of ethanol than gasoline, and that process is often fueled by dirty sources like coal. Factor in the emissions generated during this production process, and ethanol sometimes comes in less green than old-fashioned gasoline. On top of that, burning ethanol also emits higher quantities of the chemical compounds that produce smog.

It takes about 29 percent more energy to refine a gallon of ethanol than gasoline.

Then again, perhaps it’s not surprising that Trump likes federal support of ethanol. After all, the real-estate mogul’s business model has historically hinged on using tax abatements and other subsidies to make his building projects profitable.

(An example: As we reported in August, Trump Tower — which features a Gucci store Trump claimed was “worth more money than Romney” — has received a $163.775 million tax break from the city of New York.)

Many of Trump’s constituents have rejected the so-called Republican establishment because of its corrupt preferential treatment for Wall Street and Big Business. But Trump’s support for ethanol belies his populist Main Street rhetoric. In reality, he’s just another rich, East Coast politician who would prop up special interests at the expense of the taxpayer.

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