Jim Clark: At last, Congress accomplishes something
In the spirit of the holiday season, a bipartisan duo consisting of Sen. Patty Murray, D-Wash., and Cong. Paul Ryan, R-Wis., crafted a budget deal that passed both the GOP House and the Democratic Senate — proving that it can be done.
Meanwhile, barely noticed by the media, conservative Sen. Tom Coburn, R-Okla., and Diane Feinstein, D-Calif., two very unlikely allies, cobbled together a proposal to eliminate the requirement that refiners add corn ethanol to the nation’s gasoline supply. That makes two bipartisan bills … count ‘em … two from this contentious Congress. How could this happen?
The ethanol blending requirement emanated from the Renewable Fuel Standard law of 2005 which basically requires refiners to add fuels from renewable sources in increasing amounts each year. Politically it was thought wise to butter up the agricultural industry (Iowa is the first Presidential preference test state) so corn ethanol became the means by which refiners complied with the law.
This mandate went fairly smoothly until refiners proposed to increase the ethanol additive to above 10 percent of a gallon of gas. Car manufacturers responded by announcing that any increase could damage engines and threatened to void car warranties if a higher percentage blend was used.
That energized the petroleum industry into lobbying for a reduction or repeal of the ethanol mandate. With the advent of higher efficiency vehicles consumption of gasoline has fallen. The ethanol mandate essentially deprived big oil of 10 percent of a declining market. Both Oklahoma and California are big oil producing states so the special interest pressure engaged the attentions of Coburn and Feinstein, both pinnacles of respect in the Senate.
It was not a hard sell. 44 percent of corn production has been going into auto fuels artificially inflating food and feed prices while not helping the environment. Also the Renewable Fuel Standard law requires an annually increasing percentage of domestic fuels to be from a renewable source and at 10 percent we have reached a “blend wall” beyond which automotive engines are endangered.
If passed by Congress and signed by the President the Corn Ethanol Mandate Elimination Act of 2013 will leave in place the renewable fuels standard but eliminate the mandate that corn ethanol be used. In Brazil, for example, they blend sugar alcohol into their fuels. Corn ethanol may still be used to comply with the law but it will not be mandated and it will have to compete with other products on the open market.
Cosponsors of the bill include Richard Burr, R-N.C., Susan Collins, R-Maine, Bob Corker, R-Tenn., Jay Hagen, D-N.C., Jeff Flake, R-Ariz., Joe Manchin, D-W.Va., and Jim Risch, R-Idaho, lawmakers representing a broad range on the political spectrum.
The proposal has strong support from the prepared food industry, dairy, beef, poultry, oil and gas, engine manufacturers, boaters, hunger relief organizations and environmental groups, an equally broad range of interest groups.
If you like reasonably priced bourbon or corn tortillas you should welcome this measure. Gannett News Service just reported that beef prices are expected to rise 3 percent to 6 percent next year. Maybe repeal of the mandate will reduce pressures on beef prices.
Repeal is opposed by corn growers who have prospered under the mandate. Their political arm, Fuels America, claims that elimination of the mandate will destroy the entire renewable fuels industry, including research into cellulosic fuels which Feinstein claims to support. I guess we’ll have to wait and see.
Jim Clark is president of Republican Advocates, and has served on the Washoe County and Nevada state GOP Central Committees. He can be reached at firstname.lastname@example.org.
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