Imagine a government energy program
that is such a disaster that the Environmental Working Group and the
American Petroleum Institute both oppose it. The anti-poverty group
ActionAid USA wants to get rid of it, as does the pro-business
Competitive Enterprise Institute. Sen. Dianne Feinstein, D-Calif., wants
to end it. So does Sen. Pat Toomey, R-Pa. They’re both sponsors of the
Corn Ethanol Mandate Elimination Act of 2015.
Feinstein pans the ethanol mandate as “both unwise and unworkable.” Quoth Toomey: “It drives up gas prices, increases food costs, damages car engines and is harmful to the environment.” Scott Faber of the Environmental Working Group told me the Environmental Protection Agency “shows corn ethanol is worse for the environment than gasoline.” The free market-promoting Manhattan Institute’s Robert Bryce believes that the renewable fuel standard costs American families $10 billion annually in higher fuel prices. But will Congress vote to kill the program? And if so, will President Barack Obama, a longtime ethanol booster, sign the bill?
Feinstein pans the ethanol mandate as “both unwise and unworkable.” Quoth Toomey: “It drives up gas prices, increases food costs, damages car engines and is harmful to the environment.” Scott Faber of the Environmental Working Group told me the Environmental Protection Agency “shows corn ethanol is worse for the environment than gasoline.” The free market-promoting Manhattan Institute’s Robert Bryce believes that the renewable fuel standard costs American families $10 billion annually in higher fuel prices. But will Congress vote to kill the program? And if so, will President Barack Obama, a longtime ethanol booster, sign the bill?
The renewable fuel standard, or RFS,
started off with the best of intentions: to reduce greenhouse gas
emissions and promote American energy independence. It morphed into a
victim of its own success. Some 40 percent of the U.S. corn crop now
goes into American gas tanks, which has driven up the cost of feed for
livestock, as well as food prices for American families. In 2013,
PricewaterhouseCoopers figured the standard pushed up food prices at
chain restaurants by $3.1 billion per year. Because the standard
requires refiners to purchase increasing volumes of ethanol, production
increased from 3.9 billion gallons in 2005 to 13.9 billion gallons in
2011, according to the Manhattan Institute. At the same time, gasoline
consumption is down 12 percent from 2015 projections. The industry is up
against the “blend wall.” When blends contain more than 10 percent
ethanol, some automotive engines break down.
Add up the many groups that oppose the ethanol mandate and you would think the Feinstein-Toomey bill is a slam-dunk. But there may be one state more powerful than ranchers, consumers, environmentalists, and capitalists: Iowa. As the host of the first-in-the-nation presidential caucuses, Iowa has a supersize presence in U.S. politics. Iowa’s GOP governor, Terry Branstad, has a pithy warning for self-styled free market GOP hopefuls: “Don’t mess with the RFS.”
Add up the many groups that oppose the ethanol mandate and you would think the Feinstein-Toomey bill is a slam-dunk. But there may be one state more powerful than ranchers, consumers, environmentalists, and capitalists: Iowa. As the host of the first-in-the-nation presidential caucuses, Iowa has a supersize presence in U.S. politics. Iowa’s GOP governor, Terry Branstad, has a pithy warning for self-styled free market GOP hopefuls: “Don’t mess with the RFS.”
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