Congress Swears Off Alcohol Finally

Subsidies are just downright bad policy. If a product cannot survive in the market on its own, it deserves oblivion. One tiny bit of cheery news as we go into 2012 is that after 32 years, taxpayers will no longer be shelling out a subsidy for corn ethanol. As MSNBC reports:

America's corn farmers have been benefiting from annual federal subsidies of around $6 billion in recent years, all in the name of ethanol used as an additive for the nation's vehicles.

That ends on Jan. 1, when the companies making ethanol will lose a tax credit of 46 cents per gallon, and even the ethanol industry is OK with it -- thanks in part to high oil prices that make ethanol competitive.

You know that corn ethanol subsidies are a really stupid idea when even Friends of the Earth opposes them. From MSNBC:

"Corn ethanol is extremely dirty," Michal Rosenoer, biofuels manager for Friends of the Earth, said in heralding the tax credit's demise. "It leads to more climate pollution than conventional gasoline, and it causes deforestation as well as agricultural runoff that pollutes our water."

Opponents also see corn ethanol, which now takes a larger share of the U.S. corn crop than cattle, hogs and poultry, as a factor in driving food prices higher.

"The end of this giant subsidy for dirty corn ethanol is a win for taxpayers, the environment and people struggling to put food on their tables," Rosenoer added.

Now Congress has to go after the mandate that requires the U.S. to produce and burn 36 billion gallons of ethanol by 2022. 

Of course, Reason has long been against ethanol (or any other type) of subsidies. 

Comments

[Privation Property = subsidy]

Land enTitlement to Regulate the free movement of Non-State peoples.

Deregulate Gambol Lockdown!

[We Need the State...]

...to keep people from living a Non-State society lifeway.

It's so libertarian.

[R C Dean]

The tax credit was just straight-up bribery. Glad to see it gone, of course, but the real problem is the mandate.

And that ain't going anywhere. Having Iowa be the first state in the Presidential primaries has cost this country tens of billions of dollars in ethanol pandering.

[Agriculture creates government]

Agriculture creates government. ~Richard Manning, Against the Grain p.73

[Trespassers W]

Jesus, mentioning the a-word is just blowing the WInjun dog whistle.

Anarcho-primitivism is a fancy word for Jason Godesky's weight loss program. ~ Trespassers W, Trespasser's Internets Review, p. 84

[AlmightyJB]

Doesn't matter. The assclown has no life. It will show up and regurgitate it's nonsense regardless.

[Trespassers W]

Well, what else is he going to do? There's seriously, like, no room to gambol.

[AlmightyJB]

He could frolick:)

[Fletch]

Manning writes frequently about trauma and poverty for the National Native Children's Trauma Center based at the University of Montana, where he is a senior research associate.

Agriculture creates jobs!

[Appalachian Australian]

I haven't exactly seen Ron Paul suffering in the polls due to his ag-subsidies stance.

[John Thacker]

And for that matter, McCain was the second most anti-ag subsidy candidate (behind Paul) in 2008.* Of course, he lost the general election.

*- A big deal was made of the fact that McCain went to Iowa and said that "with oil over $100 a barrel, maybe ethanol makes sense." He did say that. He also said in the same sentence that he was still against the government subsidy, tax, and mandate, just that maybe the science worked out, he didn't know, let the market decide. (He did, after all, vote against both energy bills.)

The ethanol pandering has little to do with Iowa being first in the primaries. There are a lot of states that love ethanol subsidies. Even states like Illinois that are dominated by a large urban center have a lot of corn farmers, hence Sen. Obama's consistent pro-corn stance.

[Xenocles]

Is bourbon considered corn ethanol for the purposes of the mandate? Is my liver considered an acceptable burner? These are all critical questions.

[Pro Libertate]

Bourbon requires no subsidy.

[Brett L]

Actually the subsidy requires the alcohol to be denatured, so please don't drink it. It has been poisoned at the request of the State.

[Xenocles]

Here I thought I found a way to do my patriotic duty and contribute to the fulfillment of the mandate.

[Michael Pack]

Now if they would admit solar and wind are a waste of taxpayer money,along with a multitude of other programs.Of couse,if your against federal funding for 'green enery' or ,say, stem cells your anti science.

[Alan]

Seen as a business decision or an environmental decision, these subsidies were always a bad idea. I wonder, however, if there was always another factor at play: a national security decision? For all its faults, the subsidy did manage to establish, in short order, the infrastructure necessary to produce an awful lot of ethanol (and not only from corn) that could replace a great deal of oil if imports were reduced due to politics, and also makes foreign wars for oil less necessary.

[Brett L]

The amount of ethanol that could be produced from ALL the corn grown in the US in a given year is something like 50 days worth transportation. That doesn't touch the other literally thousands of products that use petroleum as a precursor. Ethanol does dick-all to improve our dependence on oil.

[R C Dean]

I wonder, however, if there was always another factor at play

Yes. The burning desire to pander to the "first in the nation" Presidential primary.

[John Thacker]

Nope, the burning desire to pander to a ton of Midwestern states. Even if Iowa weren't first, there would still be the pandering-- and definitely the Congressional support anyway. It's a whole lot more than Iowa.

Note that the winner of Iowa hasn't gotten the nomination in quite a while.

What caused ethanol to have such support was its broad coalition of corn farmers with environmentalists. What's caused its fall is the environmentalists leaving that coalition, together with the livestock farmers upping their opposition.

[R C Dean]

What's caused its fall

It hasn't fallen yet. The mandate is the real issue, not the tax credit.

You're right, though, that its more than just the Iowa caucus pandering. I still think that's a major piece of it, though.

[Pork Bellie]

Maybe not your point, but the mandate has very little to do with Midwestern farmers and a lot to do with coastal environmentalists; they just get to toss a bone to fly-over country to feign showing interest in the rest of the nation.

[John Thacker]

Well, the environmentalists only go this far because the mandate is still in place. They're hoping that switchgrass, Brazilian sugar ethanol, etc. will take the place of corn ethanol and the mandate will still be met.

There would not have been a majority in Congress for eliminating the mandate, because the environmentalists would not have gone along.

[P Brooks]

What are the odds this gets furtively reinstated during the next round of "debt negotiations"?

[Fist of Etiquette]

Food as fuel. Only in America. WHAT A COUNTRY!

[Sparky]

We should be shoving that in the face of every destitute and starving nation on the planet. We have so much food here we can just burn it for fuel.

[wylie]

We have so much food here we can just burn it for fuel.

Fuel to transport uneaten left-overs to the landfill.

[P Brooks]

even the ethanol industry is OK with it -- thanks in part to high oil prices that make ethanol competitive.

SRSLY?

[R C Dean]

Ethanol doesn't need to be "competitive". Its fucking mandated, already, at higher and higher concentrations.

Ethanol could cost $100/gallon, and it wouldn't hurt sales to the fuel refineries one bit.

[John Thacker]

Though I think technically the mandate mandates some form of "biofuel" and other fuels could hypothetically satisfy it.

Delusional Hopeful environmentalists think that switchgrass ethanol or something else will suddenly rise and fulfill the mandate.

[Brett L]

10% ethanol in gasoline. Thankfully, the EPA got slapped down by Congress when they tried to mandate 15%. Only because 15% ethanol will dissolve many of the plastics used in gas powered vehicles manufactured before 2006.

[wylie]

That's way more sensibility than I'd have ever expected of Congress.

I mean, hell, just mandate 15% and you've got a ready-made cash for clunkers program.

[John Thacker]

The 10% ethanol in gasoline is different from the hard limit in gallons of biofuel required. The 10% ethanol is the max permitted in an attempt to satisfy the main hard biofuel limit.

The reason that they asked for 15% is that the total gallon of biofuel mandate is essentially impossible to achieve, not that that stopped Congress from voting for it.

Not that anyone on these boards or working for Reason really hated ethanol enough and the Energy Bill mandating it to vote for a Senator who opposed them and hated voted against them.

[John Thacker]

That's putting a brave face on it. Of course they'd rather have the subsidies.

And, as R C Dean repeats, the mandate is more important. Just like how the real sugar subsidy isn't something obvious, but a quota on imports combined with a program to accept sugar as a loan collateral that can be forfeited at a guaranteed price.

[Warren]

Ending the ethanol subsidy is a good thing. Kind of like when you stop beating yourself in the head with a bat. Now if only we could put an end to the dozen other ways we subsidize corn.

[AlmightyJB]

Somebody didn't get their kickback.

[Res Publica Americana]

You libert-aryan thugs are clearly behind the times; in 10 years, we'll all be driving Earth atmosphere-powered cars, and Holy Terra will be safe from humanity's sacrilegious evisceration.

Now, if you don't mind, I've got a picture of a forest to go beat off to violently.

/Liberal

[Trespassers W]

Ironically, Holy Terra doesn't have an ecosystem left. Isn't Eurasia pretty much taken up by the Emperor's Palace?

...I have to stop reading the Warhammer 40k wiki.

[Res Publica Americana]

Yeah, and half the rest of the planet's occupied by the priesthood, the bureaucracy, and the FTL-enabling facility, but dude, read this:

"The Adeptus Administratum is the administrative and bureaucratic division of the Adeptus Terra, the heart of the gigantic bureaucracy that controls the government of the Imperium of Man, consisting of untold billions of clerks, scribes and administrative staff constantly working to manage the Imperium at every level, from assembling war fleets to levying taxes. It is the largest of the departments comprising the Adeptus Terra, and ten billion Administratum adepts work in the Imperial Palace on Terra alone. Its billions of officials on Terra and throughout the galaxy are constantly carrying out population censuses, working out tithes, recording and archiving information, and the million other things that are necessary for the running of the Imperium. Such is its immense size, that whole departments of the Administratum have been submerged by a sea of complex bureaucracy, becoming lost in loops of paper trails. Other departments have continued to dogmatically operate and carry out their founding function, even if the intent and requirement behind them no longer exists."

Sounds like the federal government, doesn't it?

[wylie]

Britain was first in development of top-notch leviathan bureaucracy. Vogons, for example.