How Bobby Jindal tries to walk the line on ethanol and the RFS

posted at 10:01 am on July 20, 2015 by Jazz Shaw

The top polling presidential candidates are getting all the press these days as you would expect, but the rest of the field is still out there trying to woo voters in the early primary and caucus states. That includes Louisiana Governor Bobby Jindal who was back on the trail last week in Iowa talking about one of my key issues of interest in this election… energy. Jindal isn’t doing very well in the national polls thus far and seems to be trying to shake up the game somewhat. With that in mind, he’s taking what some are describing as a tough but fair line, speaking truth to Iowans about ethanol and the Renewable Fuel Standard. (From the Des Moines Register)

Louisiana Gov. Bobby Jindal and U.S. Sen. Chuck Grassley agreed on a need for federal agriculture subsidy reforms, including moving away from direct annual subsidies to farmers, during a fundraiser for Grassley in Marion on Saturday afternoon.

During a one-on-one interview with the Register before the private fundraiser, Jindal said he wants to continue the reforms happening now, and move subsidies toward an insurance model that helps farmers in dire situations…

“At the time, I thought it was a good thing to help the industry get on its feet to compete,” Jindal said. “But I also think it’s time now to try and phase it out. The reason I say that is I don’t like the government picking winners and losers.”

If Jindal were really on board with dumping the RFS I would be happy to see his opinion “evolve” and get on the team with the good guys. But has he really? Jindal released his energy plan last September, along with a number of other policy papers. At the time it didn’t raise that much of a stir, but he brought up the RFS question right out of the gate. At first glance it looked good, and even the Wall Street Journal praised his energy plan last year for going after Iowa’s sacred cow.

But folks who read his full plan in September saw through it, such as Dan McLaughlin at Red State. Jindal says a lot about not picking winners and losers, (a recurring theme many of us agree with) but he doesn’t want to turn ethanol into a loser too quickly. McLaughlin found this quote from the plan to be “disappointing.

However, while government should not pick winners and losers in the marketplace, it also should not make abrupt and radical policy changes that disincentivize investment. In short, the government should not turn specific sectors from “winners” to “losers” overnight. Instead, federal policy should provide a gradual transition away from all sector-specific subsidies and mandates, including requirements like the RFS. In addition, the federal government should continue to fund basic research and development into more efficient forms of ethanol and biodiesel.

In that one section you can see the problem I have with candidates who are trying to play this particular shell game. They know that conservatives nationally are opposed to the RFS and mandates requiring ethanol in our gasoline and other energy products. But that brass ring of the Iowa caucuses is still too tempting so they talk about a “gradual” shift away from it. When you hear Jindal addressing the folks in Iowa it sounds like he’s talking about more of a “generational change” so that they can support him, ostensibly because the RFS wouldn’t disappear until they were dead and in their graves.

You can’t eat your cake and have it too, and when it comes to ethanol you’re either on our side or you aren’t. Saying that a government policy is harmful and should be eliminated is not a very compelling campaign point if you’re not willing to remove it until some hazy point beyond the horizon. If Jindal wants to build some support by taking the same tough stand that both Ted Cruz and Carly Fiorina have taken on this issue, he needs to clarify when he would do something about it if elected. Until he does that I’m taking this as little more than political doublespeak.


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Comments

If you truly follow Jindal, especially during this last term as Louisiana Governor, you will know that he often speaks out of both sides of his mouth this way, especially about budgetary matters. I mostly like the guy, but he is making a mistake running for President.

CantCureStupid on July 20, 2015 at 10:12 AM

Jindal has the charisma of a 7/11 clerk.

Thank you. Come again.

HugoDrax on July 20, 2015 at 10:13 AM

I agree with Jindal. You can’t have a program in place for years and years and then quit cold turkey. I would’ve preferred it had he said he favored phase out over a specific number of years but his point is still solid. We have elections every two years. If a Republican president gets elected with a GOP Congress who then cut off subsidies to farmers, how do you think the midterms are going to go? Boil the frog, Jazz. Boil the frog.

Occams Stubble on July 20, 2015 at 10:27 AM

Jindal is a very pragmatic realist. It’s one of the things that I respect the most about him, although it can often be frustrating to accept that type of approach when one wants something done yesterday.

How quickly RFS subsidies would be stopped depends on how high the economic impact would be to stop them tomorrow. If it’s going to shut a lot of farmers down, generate shortages on food or drive prices up…Jindal would look at all those factors in trying to develop a schedule eliminating the subsidies.

I would expect him to respond the same way about trying to repeal Obamacare outright, because of the manner in which Obamacare is altering the healthcare system and how much economic impact those alterations have, both for providers and for consumers.

At least he’s straight up about it and doesn’t try to sugar coat it by saying “on day one”, etc. etc.

lineholder on July 20, 2015 at 10:28 AM

Politicians never do things because they are right. Only political expediency.

Waffling on things like this is why Jindal isn’t going to the debates.

ConstantineXI on July 20, 2015 at 10:33 AM

Jindal is, quite simply, a post generating MACHINE!

6 comments already and it’s only been two hours!

Redstone on July 20, 2015 at 10:45 AM

I agree with Jindal. You can’t have a program in place for years and years and then quit cold turkey. I would’ve preferred it had he said he favored phase out over a specific number of years but his point is still solid. We have elections every two years. If a Republican president gets elected with a GOP Congress who then cut off subsidies to farmers, how do you think the midterms are going to go? Boil the frog, Jazz. Boil the frog.

Occams Stubble on July 20, 2015 at 10:27 AM

I also agree with Jindal, but that doesn’t change my mind that he’s nothing if not a political opportunist. I’m not exactly enthralled over Louisiana’s economy, either.

HiJack on July 20, 2015 at 10:53 AM

8

Schadenfreude on July 20, 2015 at 12:15 PM

Another reason Jindal has for being careful is Big Sugar – the oldest agricultural subsidy in the US. Early 1800’s I think. Slaying the corn/ethanol sacred cow may end up goring his own. Sugar price supports are the reason candy manufacturers have moved to Canada and Americans are force to choke down high fructose corn syrup (HFC) in their soft drinks. Technically, it is a loan program. The Feds accept the prospective sugar harvest as collateral on loans. If the price fails to reach an absurdly high benchmark (18.5c vs 12.5c market), the govt accepts the physical sugar. Now days it is used for ethanol – which is insane considering all of the energy and effort expended to refine it for human consumption.

deadman on July 20, 2015 at 12:46 PM

At least he’s honest. If you change major policies, and subsidies, suddenly you risk causing tremendous damage to those who’d been counting on their continued existence.

And the ethanol subsidy is certainly a worthy target. As the world starves, we’re burning food for fuel, even though we have more than enough inedible fuel for decades. Yet, if you’ve got loans and liens against your corn crop, suddenly devaluing it could lead to financial ruin for many farmers, banks, and other connected businesses. So, gradually closing it off seems to be the responsible thing to do. But not too gradually!

ReggieA on July 20, 2015 at 4:38 PM

Oh Bobby, if you don’t abandon crony ethanol right here, right now there is one loser you will guarantee: yourself.
A Republican in spirit is one who would be horrified at the prospect of using government force in the market place. What does that make Mr. Jindal?

WyattsTorch on July 20, 2015 at 7:21 PM

Until he does that I’m taking this as little more than political doublespeak.

I don’t think it’s doublespeak.

. . . my governor is too good for this country.

— Go elect Jeb.

Axe on July 20, 2015 at 9:14 PM

Or Perry. He was dim, but now he’s bright. You can tell because he has glasses now.

Axe on July 20, 2015 at 9:15 PM

Or Walker. Issue enough passes and no one is illegal.

He’s really thought it through.

Axe on July 20, 2015 at 9:16 PM

You can’t have a program in place for years and years and then quit cold turkey.

Occams Stubble on July 20, 2015 at 10:27 AM

Sure you can.

Younggod on July 21, 2015 at 2:55 AM