End the ethanol mandate, other subsidies

Private sector people are not smarter or more prescient than those in government. The biggest advantage the private sector enjoys is that it can - is forced to - abandon mistakes. Government has the power to double down on its errors. The Renewable Fuel Standard, enacted by Congress in 2005 seemed like an idea but subsequent events proved it was not. Those who do not correct a mistake are making another. Get rid of the ethanol mandate.

I had a lot of hope for this too. I was hoping for a robust market for my forestry byproducts. I even invested some money in a start-up firm that had promising technology for making ethanol from wood chips. I believed experts who thought that cellulosic ethanol would be viable by now and thought it was worth it to pay a little more now to jump start a viable sustainable fuel source. I was wrong. If you believed it then, you were wrong and if you believe it still you are probably stupid.

Ethanol is not always bad. It depends on how you make it and what you make it from. Our Brazilian friends make ethanol from sugarcane, which is about seven times (that is 7 times not 7%) more efficient than that made from corn. Perhaps someday ethanol will indeed become a major fuel source for Americans, but not today, not tomorrow and not soon. So why don't we just let it develop on its own? Let private investors take the risks and reap the rewards without forcing Americans to buy the product and the taxpayers to subsidize it.

It is usually a mistake for government to get into favoring particular products in the market. Those who argue for "temporary" subsidies are fooling themselves and trying to fool us. What ends up happening is that these temporary measures live longer than the politicians who enacted them. Special interests develop around them. These guys are good at playing politics and usually also very good coming up with great PR arguments to defend their particular interests.

Posted by Christine & John at January 17, 2013 7:16 PM
Comments
Comment #360627

I’m with ya C&J, get rid if the ethanol mandate.
I didn’t hold much if any hope for ethanol. Anyone that remembers the gasohol from the late 70’s knows that ethanol was put in gasoline to make gasohol. It didn’t work then and the only reason it’s working now is because of the government mandated it.
The problem with ethanol is not only does it cause a loss of gas mileage, but alcohol, which is what ethanol really is, dries out the seals in your fuel system and causes leaks. While this might take longer running gas with it than running straight ethanol, it will eventually happen and you’ll end up with a sizable repair bill. Unless your mechanically inclined and can replace the seals yourself. And I haven’t seen where it’s done much to clean the air up any.
Someone sold the government a bill of goods here. Not only are the ethanol companies getting subsidized with taxpayer money, but the mandate insures a market for their product.
I’m surprised the liberals ain’t all over this since they’re dead set against corporate welfare [subsidies].

Posted by: Ron Brown at January 17, 2013 11:53 PM
Comment #360641

Before I moved to Texas over 30 years ago I lived in Virginia. Being a Yankee, I was enthralled with seeing tobacco fields and tobacco sheds for drying. I found out that tobacco production was protected to keep prices high. One could only sell tobacco grown on land that held a tobacco allotment. The collusion involved government, tobacco companies and tobacco producers. It was very good for them, and…not so good for consumers.

We find many of those same kinds of collusion today in many different areas of human endeavor and most, if not all, benefit some while harming others.

Ending the ethanol mandate would be a good place to start as there is limited benefit to some and harm to many.

Posted by: Royal Flush at January 18, 2013 2:24 PM
Comment #360645

Royal

People always fall for the idea that a mandate, subsidy or special break will be temporary.

Posted by: C&J at January 18, 2013 4:01 PM
Comment #360655

Ron Brown, suggesting that liberals are against corpocracy misses the mark by a few miles. Consider the recent solar power dust ups, funding Japanese lithium battery mfctring, etc.

I don’t believe Archer Daniels Midland would agree with you either.

Posted by: Roy Ellis at January 18, 2013 11:40 PM
Comment #360664

I’m well aware of the money wasted by Obama on ‘green companies’ Roy. I wish they had a symbol for sarcasm.
The liberals keep on screaming about corporate welfare when it comes to farm subsidies, oil companies, ect. But they turn around and give it to ‘green companies’ that go belly up within a months or two.

Posted by: Ron Brown at January 19, 2013 8:41 AM
Comment #360666

I might be old but I’m also slow - -

Posted by: Roy Ellis at January 19, 2013 10:37 AM
Comment #360712

I might be old but I’m also slow - -

Know he feeling well Roy.

Posted by: Ron Brown at January 21, 2013 1:25 AM
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