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Regulatory Commissars

The Ethanol Swamp Isn't Getting Drained

Why would this president support an ethanol industry that hurts the economy?

Brian Mark Weber · Apr. 27, 2018

When Candidate Donald Trump courted voters in 2016, they were drawn to his commonsense approach to fixing problems — an approach that drew a clear distinction between his candidacy and others. Trump spoke about restarting America’s stagnant economy, bringing back jobs and industry, and making our country energy independent. So why would a billionaire businessman-turned-president support an ethanol industry that hurts the economy?

You guessed it: politics. But it’s not as simple as a Republican president going up against Democrat opposition in Congress. This is about the swamp, which includes powerful congressional Republicans who think about their own power first and what’s good for America second.

And the very swamp that Trump promised to drain won’t lose a drop as long as the ethanol industry wields its influence on Capitol Hill. Case in point: When EPA Administrator Scott Pruitt mentioned the possibility of rolling back the ethanol mandate last fall, Sen. Chuck Grassley (R-IA), the King of the Corn Belt, threatened to prevent the confirmation of Donald Trump’s EPA nominees.

Grassley, chairman of the powerful Senate Judiciary Committee, won’t stop there. Grassley has the authority to prevent the vote on any one of President Trump’s nominees. Don’t doubt for a second that Grassley won’t hold up important nominations to ensure that our tax dollars continue to subsidize the woefully inefficient (and environmentally unfriendly) ethanol industry of his native Iowa.

It looks like Grassley’s threat, as well as pressure from the corn and ethanol lobbies, is working. At a recent White House meeting, President Trump announced that he may allow the sale of gasoline blended with 15% ethanol year round. He added, “We’re going to work out something during the transition period, which is not easy, very complicated.”

The problem with President Trump’s nod to Big Corn is that it comes with great costs and flies in the face of everything the president has touted about creating jobs and strengthening the economy. He knows this, but he also knows that the Corn Belt states helped put him in the White House. That’s why Candidate Trump promised to expand ethanol production during the 2016 presidential primaries, and he’s not walking it back.

Naturally, this new policy will be embraced by the farmers who’ll reap the benefits of increasing production. On the other hand, oil refiners will balk at the Renewable Fuel Standard, which they correctly claim is too costly and forces smaller companies to buy RINs (renewable identification numbers) from larger companies that have unused credits to spare.

Pruitt, then, appears to be the only hope for reversing the ever-expanding ethanol mandate. Interestingly, he was recommended to the position by the owner of a small oil refinery that currently faces stiff costs in order to meet the federal ethanol mandate. But Pruitt’s influence can only go so far. In fact, it leaves us wondering whether the long knives that are now out for Pruitt have been dipped in ethanol.

While Pruitt has stated that the burden on refineries and the RINs need to be addressed, President Trump isn’t ready to budge. Neither is the president’s Agriculture Secretary, Sonny Purdue, who stated last year, “Ethanol is here to stay, and we’re going to work for new technologies to be more efficient.”

Despite the effort of ethanol’s proponents to market their product, its negative effects cannot be dismissed. A full decade ago, even the left-leaning Time magazine ran a cover story entitled “The Clean Energy Myth,” an article whose takeaway was that “politicians and big business are pushing biofuels like corn-based ethanol as alternatives to oil. All they’re doing is driving up food prices and making global warming worse — and you’re paying for it.”

While it’s true that the anthropogenic global warming industry is full of hot air, Big Ethanol’s claim that its product is better for the environment is simply false. Ethanol production emits more CO2 than fossil fuels. And there’s the impact of higher food and fuel prices, which further hurt our economy. Add the fact that ethanol production has wiped out millions of acres of conservation lands and diverted a significant amount of our food supply away from those who need it most, and there’s little to like.

Actually, this boondoggle is just flat-out appalling.

At the time, the 2005 law requiring oil refineries to blend 10% plant-based ethanol into their fuel seemed reasonable, as U.S. oil production was still dependent on expensive overseas crude and environmentalists were pressuring Congress to produce clean energy. So it’s no wonder that the use of fuels blended with ethanol sounded like a perfect marriage between environmentalists wanting to produce clean energy and oil interests wanting to protect their industries.

Ten years out, and there are only two beneficiaries of ethanol: the agriculture and ethanol industries. The rest of us are victims of yet another clean-energy scam now supported by the very president who promised to drain the swamp and clean up cronyism in Washington.

On this issue, the swamp is the hands-down winner.

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