Call Out Crony Crops
Veronique de Rugy points out spending tensions in a blog for National Review:
Remember all the special interest giveaways in the Inflation Reduction Act? While it was doubtful that legislation would ever reduce inflation, it was a cornucopia of subsidies and tax credits to green energy companies. The GOP plan to demand cuts in exchange for raising the debt ceiling originally included many of these tax credits, but the Republican corn lobby wanted to keep them.
Semafor reported:
When Speaker Kevin McCarthy only has four votes of wiggle room in passing GOP legislation, the corn caucus can be as powerful as the Freedom Caucus. After a proposed repeal of biofuels subsidies prompted a rebellion by Midwestern lawmakers, leadership is making changes to a bill they presented as non-negotiable…At about 2 a.m. Wednesday morning, Republican leaders filed amendments to their package aimed at winning over the holdouts. With the changes, the bill would no longer repeal some of the biofuels tax credits the corn-belt Republicans expressed concern over, and would allow companies that had already made business decisions based on the credits to claim two others.
An Axios writer concisely said that Speaker McCarthy “ran into a wall of corn.” Every Member of Congress from Iowa marched into the Speaker’s office to plead the biofuel case, and of course, they were successful (at least for now).
After 10+ years of failing to wean farmers and ethanol processors off of a host of ag subsides, it a wonder if things will every change.
Will the ultimate end to government ethanol support come in the form of environmental regulation? Perhaps, especially if no legislators from agriculture focused states are willing to figure out how we should sustainably wean off companies from government cash.
U.S. Ethanol Production
Chart data source: U.S. Energy Information Administration
In a piece for The Cedar Rapids Gazette, Patricia Patnode writes:
Farmers have been manipulated…This is not their fault. A farm is a business, it only makes sense that they grow the highest value crop in response to market prices. After all, the government wouldn’t ask them to do something that would harm our country in the long run, right? Wrong. Since the Renewable Fuel Standard took effect corn grown for fuel use increased by 4.1 billion bushels between 2004 and 2016.
She goes on to say:
Climbing out of the cash-lined grave we are digging will be difficult and require courage and leadership. So far, no one has had the gumption to correct the situation.
It's not all doom and gloom, but we should start asking tough questions, especially given that in the future, more of America's car fleet will be electric, naturally decreasing the demand for gasoline fuel, the main use for ethanol.
With our exploding national debt, it's time to stop wasting taxpayer dollars and encourage innovation.
Further Reading: