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.