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Monday, December 31, 2007

Iowa cornfields fuel folly of presidential hurdles

By Dennis Byrne
Chicago Tribune

'I've long said that the Iowa caucuses are the gift to Midwestern agriculture.'

-- John Doggett, vice president of public policy for the National Corn Growers Association, as reported by the Associated Press

Gift, you say? Yeah, I suppose you could call a multibillion dollar government handout to special interests a gift. But the word gift just doesn't seem accurate or vast enough to describe the massive plundering that's in store for taxpayers and consumers at the hands of ethanol addicts.

That's thanks to the unrealistically important role that Iowa plays as the first state up in the presidential sweepstakes. Iowa is the nation's biggest corn-producing state (Illinois comes in second), and ethanol's biggest feedstock is corn. So, a veritable parade of presidential candidates from both parties must prostrate themselves in Temple Ethanol.

Take Democratic Sen. Hillary Rodham Clinton of New York who opposed a hike in ethanol subsidies a couple of years ago, but now that she's stumping Iowa fairgrounds and parlors, she's for them. "Iowa is way ahead of the rest of the country," she said. "What you've done with ethanol ... you're setting the pace."

Yes, Iowa could give lessons to the Texas oil industry when it comes to "setting the pace" in the subsidy Preakness. The Iowa Corn Growers Association keeps close track: Six of the top eight Democratic candidates support or lean toward supporting a 51-cent "blenders credit" for every gallon of pure ethanol mixed into gasoline to help keep the price lower than gasoline.

(Wait a minute, you say. If we have to subsidize ethanol to compete or beat the price of gasoline to the tune of 51 cents a gallon, why don't we just use gasoline? Good question.)

Our beloved Sen. Barack Obama goes further; he would give motorists a 35-cent-per-gallon tax credit for using E85 -- a fuel blend that uses only 15 percent gasoline. Only Sen. Joe Biden of Delaware outright opposes the subsidy. The group apparently couldn't fathom where Rep. Dennis Kucinich of Ohio and Sen. Chris Dodd of Connecticut stand on the 51-cent subsidy, but Dodd is for a big hike in the federally mandated use of ethanol (another form of subsidy).

Republicans are little better. Of the leading GOP candidates, only Sen. John McCain of Arizona and Rep. Ron Paul of Texas outright oppose the 51-cent subsidy. Then again, Paul opposes everything, except, I guess, freedom. McCain also "leans towards" opposing a 54-cent per gallon tariff on imported ethanol, made from sugar cane much more efficiently than from corn. No other candidate (except, of course, Paul) in either party appears to oppose the tariff.

I can think of no other major issue garnering such bipartisan agreement and, in this, bipartisanship is not a virtue but a sell-out.

Despite its canonization by "greens," researchers on the grant dole, processors like Decatur-based ADM, ethanol is more promise than reality and possibly a swindle of national proportion.

It may cost more energy to make ethanol than it saves. Its demand for corn puts upward pressure on food prices. It's more costly and difficult than oil and gasoline to transport. The industry's protectionist trade policies anger allies and make a mockery of our argument for free or fair trade.

Gallon for gallon, ethanol provides less energy than gasoline. Even its environmental value is questioned.

The ethanol industry disputes this, but what is not in dispute is that ethanol has made farmers, investors and others in agribusiness rich. As if they were not made rich enough by a lavish aid bill enacted two years ago, President Bush has signed an energy bill that vouchsafes significantly greater cash and benefits to the industry.

Everyone understands the need for stability in the nation's agriculture sector, but the anti-technology, unscientific and ideologically inspired promises being seeded all through Iowa by the candidates go beyond reasonable.

And it will continue for as long as some unwritten rule requires that Iowa kick off the presidential campaign, giving its winners a head start to be president. Maybe it's time for a constitutional amendment that would make the contest for the presidency a truly national election, instead of this silliness now thrust upon us by the farmers of Iowa.


Illinicowboy said...

I couldn't agree with you more. It would be interesting to find out what the true cost/gallon is when you take out all of the subsidies. If someone did that maybe then the politcal tomfoolery would end. In the meantime, I will instruct my broker to buy John Deere and ADM.

Anonymous said...

good article. I share your sentiments in regard to ethanol and all the political blather surrounding it, as well as Iowa being treated as somehow significant or representative of mainstream America.

lake county democrat said...

It goes far beyond ethanol: it's not hyperbole to say that 1) we're at war and 2) we're funding the enemy who is killing our fighting men and women. We should have had some sort of "patriot tax" on oil within a week of 9/11 (and please spare us blather about opening ANWAR -- go ahead and open it, we wouldn't see an effect for years and it would only make a small dent in the problem).

There were lots of good proposals for this. A "fake tax" that would be refunded to drivers at the end of the year but would encourage immediate conservation. An oil price "floor" that would stabilize prices to encourage investment in alternative energy (one suggestion: use the excess money to fund private social security accounts).

The idea that ethanol is a cure to our "oil addiction" is beyond inane. Nuclear power has far more promise.

Instead, we see the evilest nations in the world (Iran, Sudan, the Whahabis in Saudi Arabia who get protection money) rake in billions. And we see our currency shrink (even compared to oil-rich Canada).

This election cries out for a Paul Tsongas or Ross Perot: someone who would shape the agenda even if they weren't elected.

Anonymous said...

Drilling in Anwar is not blather, nor is it blather to push for drilling offshore in the Gulf of Mexico, or the oil in our western desert areas. The Chinese now will be drilling off Cuba in our place. Talk about shooting ourselves in the foot (feet?).

Maybe some other technology will replace gasoline/oil, but for the short-term, we need to use what we have have.

lake county democrats said...

To anon: yes, it's blather. As I said, go ahead and drill there. How long will it be until you see the first drop of oil? We're at war, and funding the people killing us, ***right now***. Immediate action was and is needed -- and no, we don't *need* to be driving SUV's and other low milage guzzlers. During World War II my parents and grandparents sacrificed. During this war baby boomers have done nothing but say gimme gimme gimme (gimme tax cuts, gimme medicare expansion, don't touch social security, etc.)

David M. said...


So what did you say new? That politicians will say things to get elected? Or that in Iowa and Illinois, it takes more energy to make ethanol than what it delivers? This is old news - even older than you. But maybe it isn't all political. Did you know that the US government is investing in new large plants to produce ethanol from other products, such as switchgrass and this would be energy efficient? If there are more cars that run on 85% ethanol, then there is more reason to develop the means to convert wood to ethanol – that is the basis for capitalism. Your ideas are older but not wiser.