I mentioned this in last night’s Roundup, but Al Gore, somewhat out of nowhere, admitted that ethanol subsidies were bad policy and that he only supported them to win the Iowa caucuses in 2000. The timing is interesting. Those ethanol subsidies are up for renewal at the end of the year. And some prominent conservatives have pitched letting them expire, to the chagrin of farm-state Senators and establishment Republicans.
Fresh off a big victory over the GOP establishment on earmarks, conservative GOP senators are opening up a new front in the battle on government spending that could be similar to the earmarks standoff: They are calling on Congress to let billions in ethanol subsidies expire.
Senators Jim DeMint and Tom Coburn, two leading conservative Senators who have pushed the GOP to be serious about its anti-spending rhetoric, told me they are calling on fellow Republicans to urge Congress to allow ethanol subsidies to expire — something that could put other leading GOP Senators in an awkward spot and subject them (in theory) to the wrath of the anti-government-spending Tea Party if they don’t go along.
The subsidies cost as much as $7.7 billion annually, and they don’t appear to improve the environment. The greenhouse gas emissions used in harvesting the corn and extracting the sugar more than makes up for the supposed savings in burning ethanol as a fuel rather than oil, and the land use taken up with agriculture as a fuel product instead of as food increases prices on the latter. As Coburn says, Senators in favor of the subsidies are “just protecting a parochial interest ahead of the national interest.”
I don’t agree with the DeMint/Coburn free market approach to absolutely everything, but the science is pretty clear on ethanol, and even environmental leaders like Gore aren’t bothering to defend it anymore. There are absolutely alternative sources of energy that provide a societal good and deserve to be promoted at the federal level, but first-generation ethanol isn’t one of them. If the subsidies survive they should go to cellulosic ethanol technologies, like wood or switchgrass or even waste.
But of course, there are going to be some powerful interests in both parties desirous of keeping the corn ethanol train rolling. Here’s Jonathan Zasloff:
Democrats have little reason to crow about this (so to speak): farm state Democrats — most notoriously former Senate Majority Leader Tom Daschle of (surprise!) South Dakota — long pushed hard for ethanol subsidies. Look for North Dakota’s Kent Conrad, who might be the most hypocritical Senator in DC (which is saying a lot), to take up the fight now.
As I’ve mentioned elsewhere, Republicans are going to start finding that their rhetoric and their contributors don’t dovetail very well: for example, they claim to oppose the individual health insurance mandate but vacuumed up $86.2 million in campaign contributions from health insurers, who love it. And unlike “earmarks,” which sound bad on a general basis, ethanol is very clear to agribusiness in farm states.
Steve Benen notes that one of the shadowy right-wing groups that helped bring Republicans to power in the midterms, the American Future Fund, was created by an ethanol industry executive. And is Chuck Grassley really going to allow Iowa corn subsidies to go away without a fight?
If Coburn and DeMint rally their forces on this one, it could be very difficult for Grassley to succeed, however. In this case, I’m rooting for them.
UPDATE: I love Grassley’s response: “Well, let’s cancel oil and gas subsidies too, then!” Sign me up! Coburn actually sort-of agreed, in response.