The EPA hearts Big Ethanol

posted at 5:11 pm on November 16, 2012 by Erika Johnsen

I’m not even going to get started on the vast — vast, I say — number of federal policies whose justification for existence is that they help protect small family farmers and/or the environment, when in fact, they accomplish precisely the opposite. For now, I’ll just pick the one — the Renewable Fuel Standard, which requires a certain amount of fuel be blended with ethanol (which is generally made from corn) every year. Daniel Horowitz at Red State does the topic justice:

The single most regressive market-distorting policy to ever emanate from Washington is the absurd tendentious treatment of ethanol.  Over the past decade, ethanol has been the poster child for the worst aspects of big-government crony capitalism.  The ethanol industry has used the fist of government to mandate that fuel blenders use their product, to subsidize their production with refundable tax credits, and to impose tariffs on more efficient sugar-based ethanol from Brazil.  These policies have distorted the market for corn to such a degree that 44% of all corn grown in the country is diverted towards motor fuel blends.  If we would literally flush half the corn harvest down the toilet, we would be better off than using it to make our motor fuel less efficient.

Now, consumers are stuck with higher food and fuel prices, while rich farmers enjoy the favors of free legislation forcing people to buy their odious product.  Although the subsidy has expired, the Renewable Fuels Standard (RFS), which requires that 10% of all fuel be mixed with ethanol, is still in effect.  There is no worse tyranny than using the power of the law to coerce citizens into purchasing an ineffectual product that costs more, and in turn, drives up the cost of everything else along the food chain.

The Midwest suffered through some serious drought conditions this summer, meaning that the price of corn has gone up as harvest yields have gone down, and farmers’ organizations, meat industry groups, a bipartisan group of federal lawmakers, and nearly a dozen states petitioned the Environmental Protection Agency to waive the RFS requirements (the government’s interference in the market means that the amount of corn used for ethanol creates artificially high demand that helps hike up the price of corn, and livestock and food producers can’t cope).

The Environmental Protection Agency is not impressed. After hemming and hawing for months, they finally announced their decision today. Surprise — they’re sticking with their BFF, the ethanol lobby. From The Hill:

“[T]he agency has not found evidence to support a finding of severe ‘economic harm’ that would warrant granting a waiver of the Renewable Fuels Standard,” EPA said Friday. …

“We recognize that this year’s drought has created hardship in some sectors of the economy, particularly for livestock producers,” said Gina McCarthy, EPA’s top air regulator, in a statement. “But our extensive analysis makes clear that Congressional requirements for a waiver have not been met and that waiving the RFS will have little, if any, impact,” she said.

The ethanol industry applauded EPA’s decision.

Yeah, I bet they did. And just in case you’re tempted to think that the EPA’s decision may’ve been born of environmentalist zealotry rather than cronyish interests… it wasn’t. Even true environmentalists tend to dislike ethanol, since it incentivizes agribusiness to bring marginal lands into production (which means more pesticides, transportation, etcetera).

Said Michal Rosenoer, biofuels policy campaigner at Friends of the Earth: “If the worst U.S. drought in more than 50 years and skyrocketing food prices are not enough to make EPA act, it falls to Congress to provide relief from our senseless federal support for corn ethanol.”

Agribusiness, however, most definitely loves a federal decree that essentially mandates people to buy their product. The Obama administration has no problem with business, you see — they love business, and they love to be loved by business. It’s the free markets they’re not too keen on, which in the long run comes at the cost of economic growth for everyone.


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Thank Moses for Erika. Without her all we would have at HA is effeminate male mushes. She actually gets it.

antisense on November 16, 2012 at 5:16 PM

Not very many people will comment on this thread however. Some will maintain the service farmers provide this country is worth the market distortion and what is essentially government handouts to select businesses.

antisense on November 16, 2012 at 5:19 PM

Not very many people will comment on this thread however. Some will maintain the service farmers provide this country is worth the market distortion and what is essentially government handouts to select businesses.

antisense on November 16, 2012 at 5:19 PM

What service? Growing food to use for fuel when we have gazillions of barrels of oil right here at home?

darwin on November 16, 2012 at 5:30 PM

You’d think that Michelle Obama would be pushing for sugar-based ethanol production instead of corn based.

This would make far more sense. A higher price for sugary foods and a more efficient source for ethanol production.

If we are going to use the government to distort markets, then why not go full on top-down?

weaselyone on November 16, 2012 at 5:31 PM

What does Obama have against poor people eating?

jukin3 on November 16, 2012 at 5:34 PM

What does Obama have against poor people eating?

jukin3 on November 16, 2012 at 5:34 PM

It’s not that he is against them eating. He just doesn’t want them to be able to afford it on their own. An increase in base food prices allows for an increase in dependency on the government.

weaselyone on November 16, 2012 at 5:37 PM

Elections have consequences and here is just another consequence of putting a communist or fascist in the White House for another frickin’ four years.

Yeah, let’s turn food into low-efficiency fuel. Why not? Makes as much sense as subsidzing $60K solar systems that will not produce enough electricity to pay for themselves in their 25 year lifespan — assuming they don’t get destroyed by hail first.

AZfederalist on November 16, 2012 at 5:39 PM

The aggravation of cleaning out carburetors fouled up with varnish from ethanol should be sufficient reason to revolt against the government in and of itself.

And this is the point in the conversation where we mention the low flow toilet – another masterpiece of government engineering. Honestly, were there a bunch of munchkins that thought that one up? It now takes three flushes minimum where it used to take only one. Only the government could figure out a way to use more water when it sought to use less.

turfmann on November 16, 2012 at 5:44 PM

EPA loves Ethanol because the stuff will ruin modern internal combustion engines quickly in the amounts they are proposing putting in our fuel.

kh6zv9 on November 16, 2012 at 5:45 PM

Said Michal Rosenoer, biofuels policy campaigner at Friends of the Earth: “If the worst U.S. drought in more than 50 years and skyrocketing food prices are not enough to make EPA act, it falls to Congress to provide relief from our senseless federal support for corn ethanol.”

Indeed. Of course, that would require that the GOP-led congress actually has a collective pair. I’m not holding my breath.

UltimateBob on November 16, 2012 at 5:46 PM

Thank Moses for Erika. Without her all we would have at HA is effeminate male mushes. She actually gets it.

antisense on November 16, 2012 at 5:16 PM

I know. She’s the best. I want to have her babies. Or something like that.

The Rogue Tomato on November 16, 2012 at 5:48 PM

44% of all corn grown in the country is diverted towards motor fuel blends

Just think of all the Doritos we don’t have today because of this.

Washington and Colorado hardest hit.

The Rogue Tomato on November 16, 2012 at 5:51 PM

Absolute waste of time, based on nothing but a PR scheme. Fake science, fake economics, fake government

pat on November 16, 2012 at 5:55 PM

If we would literally flush half the corn harvest down the toilet, we would be better off than using it to make our motor fuel less efficient.

We would be better off paying the farmers to burn the corn in the fields, but then the EPA would fine them for pollution.

STL_Vet on November 16, 2012 at 5:56 PM

David Horowitz at Red State does the topic justice:

There is no worse tyranny than using the power of the law to coerce citizens into purchasing an ineffectual product that costs more, and in turn, drives up the cost of everything else along the food chain.

David Horowitz rocks.

He is absolutely right here. However, as usual, the left is laboring under some delusion that Ethanol is somehow more environmentally friendly than fossil fuels. They ignore the fact that Ethanol production actually requires more energy than it yields, so it’s a waste from the get-go. It also does not burn as efficiently as gasoline. Not to mention the corrosive effects it has on both plastic and metal fuel system components.

Apparently those “enlightened” souls never took so much as a high school level chemistry course.

UltimateBob on November 16, 2012 at 5:59 PM

And this is the point in the conversation where we mention the low flow toilet – another masterpiece of government engineering. … Only the government could figure out a way to use more water when it sought to use less.

turfmann on November 16, 2012 at 5:44 PM

To that I would add:
– Dishwashers that now require 4 hours to complete a cycle because of regulations that limit the amount of water and energy they can use. By doing a 4 hour cycle, they can actually clean dishes
– Clothes washing machines that don’t. When you have to clean the washing machine to eliminate odor, there is a problem.
– Forcing the sale of dishwasher soap that doesn’t clean dishes, but leaves a white film on all your dishes because the phosphates have been removed.

That’s just the ones that I could think of in 30 seconds.

AZfederalist on November 16, 2012 at 6:00 PM

ADM…..Archer Daniels Midland.

……they and Cargill own politicians by the score do they not?

PappyD61 on November 16, 2012 at 6:08 PM

Speaking of drought, it takes 3 gallons of water to make 1 gallon of ethanol if you have an updated processing plant. Others require 6 gallons of water to make 1 gallon of ethanol.

Ethanol is a waste of our precious nature resource and probably the most expensive resource.

Ethanol doesn’t help fuel mileage and is a corrosive on some fuel systems.

It’s going to be hard to recover after 4 more years of the EPA’s regulations.

plutorocks on November 16, 2012 at 6:14 PM

Well the epa just loves ethonal? MY car, Hubbies truck, and all our lawn mowers will crater if WE use it! And millions upon millions here in the US and other countries will NOT have food and if they do, it will be SO expensive they can’t eat?

I guess we get bhocare for ‘the last of life’ to see to we die, or we don’t have food? And with ethanol, OUR oil/gas/shale is sol along the way?

But, bho/team/the foto’s get their tons of flesh from us either way?
L

letget on November 16, 2012 at 6:14 PM

Elections have consequences and here is just another consequence of putting a communist or fascist in the White House for another frickin’ four years.

AZfederalist on November 16, 2012 at 5:39 PM

Yeah, we should have elected Romney, who supported the exact same policy.

Republican presidential candidate Mitt Romney released a white paper on his agriculture policy this week. Within the document, Romney announced his support for the renewable fuel standard (RFS). Under a section of the white paper, titled “The Romney Agenda: Energy Independence,” Romney said that “fulfilling the federal government’s commitment to biofuels growers and refiners and providing them with certainty they need to follow through on their investments in promising technologies,” is one of the ways to achieve energy independence by 2020.

“Romney recognizes that biofuels are crucial to America’s energy future and to achieving his goal of energy independence, and he supports maintaining the Renewable Fuel Standard to guarantee producers the market access they have been promised as they continue to move forward,” stated the white paper.

http://ethanolproducer.com/articles/9196/white-paper-outlines-romney-agriculture-policy-addresses-rfs

cam2 on November 16, 2012 at 6:24 PM

On my way to work I drive past all of the new outbuildings the farmers are constantly putting up. Profits are goooood! I don’t begrudge anyone success or more than what I have IF they do it honestly. However, the farmers are just middle class welfare recipients now. Between ethanol and wind subsidies, the rest of us are paying for their new buildings, equipment and trucks.

Free Indeed on November 16, 2012 at 6:33 PM

However, the farmers are just middle class welfare recipients now. Between ethanol and wind subsidies, the rest of us are paying for their new buildings, equipment and trucks.

Free Indeed on November 16, 2012 at 6:33 PM

Watch it, you’re starting to veer from the accepted talking points. Remember, promises to business/industry are policy positions. Promises to ordinary citizens are “gifts.”

cam2 on November 16, 2012 at 6:40 PM

Great article Erika.I’m a first generation dairy farmer and this ethanol racket is killing me.Nothing in this once great country makes any sense anymore including the voters giving Obama four more years.

eze breeze on November 16, 2012 at 6:47 PM

Great article Erika.I’m a first generation dairy farmer and this ethanol racket is killing me.Nothing in this once great country makes any sense anymore including especially the voters giving Obama four more years.

eze breeze on November 16, 2012 at 6:47 PM

Solaratov on November 16, 2012 at 8:10 PM

I own a 1981 Ford pickup and a 1984 Oldsmobile. About a year ago I discovered that there are a number of places where I can purchase gasoline without ethanol or methanol blended in. It costs a little more per gallon, but my mileage is greatly improved, my vehicles run a WHOLE lot better (and my lawnmower and weedeater), and I have the personal satisfaction of sticking it to the ethanol lobby. There is probably a location near you if you look. Google “non-ethanol gasoline retailers,” or some such query. I also write to my representative and senators regularly and give them my opinion on the ethanol mandate. We got rid of the subsidy. Once the mandate goes away we’ll see lower fuel prices, lower food prices, and longer vehicle lifespans.

Elric on November 16, 2012 at 8:13 PM

And this is the point in the conversation where we mention the low flow toilet – another masterpiece of government engineering. Honestly, were there a bunch of munchkins that thought that one up? It now takes three flushes minimum where it used to take only one. Only the government could figure out a way to use more water when it sought to use less.

turfmann on November 16, 2012 at 5:44 PM

Low-flow toilets were a brainstorm of deep-eco types who are horrified by the prospect of overuse of water. Many cities with trendily progressive governments mandate them today.

One such is San Francisco. As a result, their sewage department has major problems due to too much solid waste clogging their system. As does practically every urban system in Germany, for exactly the same reason.

People who want long-standard equipment changed in the name of “Saving Holy Mother Gaia” should first ask themselves why said equipment was developed to its existing form in the first place. Electric cars failed in the market a century ago, as they are doing today. Alcohol (ethanol) was tried as an IC engine fuel about the same time, along with castor oil (!); both proved to be inferior to, and less safe than, “light petroleum fractions” (gasoline and kerosene) due to poorer combustion characteristics, including dangerously low flash points.

As the old engineering principle says,


If nobody does it that way, there’s usually a very good reason.

clear ether

eon

eon on November 17, 2012 at 7:02 AM

On my way to work I drive past all of the new outbuildings the farmers are constantly putting up. Profits are goooood! I don’t begrudge anyone success or more than what I have IF they do it honestly. However, the farmers are just middle class welfare recipients now. Between ethanol and wind subsidies, the rest of us are paying for their new buildings, equipment and trucks.

Free Indeed on November 16, 2012 at 6:33 PM

We ranch & all of our neighbors are farmers. They are all wh0re$ to the Fed.
There’s a guy down the road who cut down on seed in the sunflower fields of his bcs he knew he could get more in crop insurance $$(the new Federal farming game as official farm payments go sunset) bcs his crop would be designated as a ‘disaster’ bcs of our drought conditions.
Farmers are the biggest wh0re$ I have ever seen. Even the ‘conservative’ farmers I know.
They make me want to puke.
And here we are the ranching schmucks who get f$%^ed over by federal meddling in farming as an end result in the form of upped land rents & prices bcs we have to compete with the federal payments.
OH there are a lot of ranching wh0re$ as well, but not as many.
You people literally cannot believe what is going on. I am watching my neighboring farmers show up it seems like daily with brand new expensive equipment & grain bins etc.
And many of them have a crop disaster just about every year.
Taxpayers are paying for this failure.

Badger40 on November 17, 2012 at 1:58 PM

In fact, I want to know where the environmentalists are who would cry out at all of the remaining native prairie here in SW ND getting ripped up for no reason other than to establish crop history in order to collect future farm payments of one kind or another (i.e. intention in enrolling highly erodible land into CRP).
These guys are scheming for the govt $$ & they will dig up their mother’s own grave to make a Federal buck.
I’m telling you it is insane.
Farmers are spending several years digging up rock infested unfarmable knobs & knolls that in the old days the farmers dug around.
They are burying these rocks in the soil really deep with huge payloaders.
They are doing all of this bcs it is going to allow them to stick it into farm programs.
I’m telling you the raping of the system is right in my face every day.
And nobody ever talks about this $hit.

Badger40 on November 17, 2012 at 2:02 PM

The EPA hearts Big Ethanol

…because nothing will shut down agriculture faster than a government-forced misallocation of farm resources…PLUS mandating the waste of food by using it to replace low-cost fuel!!!

Self-destructive Leftist idiocy knows no bounds.

landlines on November 17, 2012 at 10:35 PM

Ethanol doesn’t help fuel mileage and is a corrosive on some fuel systems.

It’s going to be hard to recover after 4 more years of the EPA’s regulations. – plutorocks on November 16, 2012 at 6:14 PM

You are very correct on this statement. People who have to use small gasoline engines, such as lawn mowers, string trimmers, chainsaws, 4 wheelers, etc., such as myself, need to use “real gasoline”, gasoline that does not have ethanol. If you don’t your small engine carburator will be ruined in just a couple of years or it will not work properly. Both gasolines do go bad over the winter, so drain your small engine gas tanks and make sure all the gasoline is out of the carburator. And, use gasoline stabilizer at all times. Even the gasoline that you save over the winter time will go bad. Do you ever wonder why your small engine (usually your lawnmower) won’t start up in the spring when you need it ……………… and all small engine repair shops up backed up with repair jobs. This is the reason.

SC.Charlie on November 18, 2012 at 8:46 AM

My view might be a bit simplistic but here it is. If the government can control food, food prices and medical care and decisions….They control your life. Isn’t that their goal in it’s entirety?
Just my thoughts.

canesfan on November 18, 2012 at 11:07 AM

All of you that think farmers got it so good, invest $10 million of your own dollars into a farm, then work to dark every day for nine months, 7 days of the week. Maybe if you are luckly, you will make it, but I doubt that most of you would last 5 years.

Highplains on November 18, 2012 at 5:35 PM