Politics & Policy

Principle over Politics in Iowa

Gas station in Johnson, Iowa, August 2012. (Justin Sullivan/Getty)

Donald Trump and Ted Cruz both have been described as “insurgency” candidates, but it is important to ask: Insurgents on behalf of what, exactly? An excellent example of what this means in real terms is the question of ethanol, the useless gasoline additive that the federal government inflicts on American consumers at the behest of corn growers, processors, and related special interests.

Ethanol is, inevitably, dear to many hearts in corn-producing Iowa, which makes it a tender subject for presidential candidates of both parties facing the early test of the Iowa caucus. It presents a test of principle. One of the basic problems of American governance is the interaction of what is known in political-economy terms as “concentrated benefits and dispersed costs.” A manufacturing tax credit that subsidizes Starbucks as a “manufacturer” to the extent that it puts beans into bags doesn’t mean very much to the average taxpayer or member of Congress, but it may mean a lot to Starbucks. Special-interest groups will fight very hard for their perks, and no one has as strong an incentive to fight against them.

RELATED: Refusing to Kiss King Corn’s Ring in Iowa

The ethanol program is pure corporate welfare. It is marketed as an environmental initiative to the Left and a hedge against filthy “foreign oil” to the Right, but it is simply a mandate, a federal rule that says gasoline producers must buy ethanol and mix it into their product. It’s nice to have a marketing department with nuclear weapons and an IRS, so the corn-juice guys are very defensive about their mandate.

#share#To stand against the ethanol mandate in Iowa is a test of political character.

Senator Cruz, a full-spectrum conservative, forthrightly opposes the ethanol mandate, as he opposes similar corporate-welfare programs for politically connected business interests. Good on him. The worst that can be said of Cruz on the subject is that he moderated his previous kill-it-now position to a five-year phase-out. If that is the sort of compromise that a President Cruz would sign off on, that’s good news. 

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

What about Trump? Trump fancies himself a deal-maker and has calculated that supporting ethanol would give him an advantage in an important early caucus state, and so he supports it. For Trump, that’s an obvious choice: Trading free-market principles on ethanol in exchange for a win in Iowa is obviously a good deal — for Donald Trump.

That it is a bad deal for the country does not move him (or, unfortunately, most of the other Republican presidential candidates). When it comes to deposing King Corn, Senator Cruz is the only one who has chosen principle over politics.


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