Of Hamsters and Men

Just two days after the Senate rejected a bill to end $6 billion in tax subsidies for ethanol producers, it reversed itself and overwhelmingly voted to end the subsidies. It seems the initial vote had more to do with hurt feelings than ending bad energy and economic policies.

All but six Democrats had voted against that measure because its sponsor, Sen. Tom Coburn (R) of Oklahoma, bypassed Democratic leadership to bring it to the floor.

Political bullshit.

The importance of the vote is likely to be more symbolic that actual. The bill to which the amendment is attached is unlikely to pass. Moreover, the Obama administration has said it would veto any attempt to cut subsidies for ethanol producers entirely.

More political bullshit.

Presidential hopefuls made a quadrennial ritual of going to Iowa and pledging to support the tax breaks, tariffs and mandates that supported production of ethanol motor fuels from corn. This year, however, some Republican presidential candidates have pointedly refused to endorse ethanol tax breaks.

Thursday's vote doesn't by itself doom federal support for the corn ethanol industry. The House is expected to reject the repeal as unconstitutional because tax bills must originate in that chamber, and the White House opposes it. But the 73-27 vote signals that once-unassailable programs could be vulnerable.

Still, there is a faint flicker of hope that this might signal the beginning of the end for a tax break that "benefits the ethanol industry, which is dominated by commodity giants such as Archer-Daniels-Midland Co., of Decatur, Ill., by sweetening the financial incentive for gasoline retailers to use ethanol."

A little history:

The government began subsidizing ethanol use in the late 1970s amid hopes that it would help wean the country from foreign oil. But food companies and livestock farmers have complained that their costs have exploded as five billion bushels, or 40% of all the corn grown in the U.S. last year, was consumed in ethanol production. The price of corn has traded above $7 a bushel for much of the spring, twice the year-ago level.

Some economists doubt that the tax credit is now crucial for the industry. The ethanol industry only began to grow rapidly five years ago when new energy legislation required gasoline retailers to use corn ethanol: 12.6 billion gallons this year, moving to 15 billion gallons in 2015.

Note the last sentence above. It's not just the tax subsidies for ethanol producers that's bad policy, it's the legislation that requires gasoline retailers to sell ethanol. We need to get rid of all legislation that artifically props up this bogus industry. Let the free market work.

Ethanol is nothing but a scam perpetrated on the public by large commercial farming interests. It does nothing to reduce carbon footprints. In fact, it enlarges them. It also raises the price of corn and other foodstuffs, adds to the cost of automobiles, has no substantial effect on oil consumption, and primarily benefits large commercial agricultural firms and related special interests. Even that paragon of environmentalism, Mother Jones, has acknowledged that ethanol hurts more than it helps.

 

And if that's not enough, Europe's highest court warned that France's increased production of corn is threatening the Great Hamster.

Europe's highest court warned France Thursday that it needs to do more to protect the hamster: the Great Hamster of Alsace, to be precise, which is western Europe's last remaining species of hamster in the wild.

The Great Hamster likes to eat things like alfalfa and grass. And French farmers have gradually replaced those crops with corn, "which is not ripe in the spring when the hamster awakens from six months of hibernation," hungry and ready to mate.

Well, we certainly don't want hordes of hungry and horny Great Hamsters swarming over Europe looking for something to eat and/or screw...