The corn lobby – which benignly styles itself The National Corn Growers Association – is upset with the Orange Man for – as CNN puts it – “reducing demand” for its crops.
What he’s actually done is reduce the mandate for them by granting waivers to refineries which would otherwise by forced by a federal law called the Renewable Fuels Standard or RFS to douse the gas they make with ethanol – which is made (in the United States) using mostly . . . corn.
Almost all of the “gas” sold in the United States actually contains 10 percent ethanol (E10) because of the regs that require, not because American motorists want it. If they did want it, there would be no need for the mandate.
Which mandate puts a lot of corn into American motorists’ tanks – and a lot of money into the pockets of the corn lobby.
Every gallon of E10 sold includes a 10 percent subsidy to the corn lobby, or about 15-20 cents per gallon. This amounts to about the same sum as the federal gas tax of 18.4 cents per gallon, but with the latter American drivers get something desirable in return for their money – the roads, without which their cars wouldn’t be much use – which they’d probably pay for without being forced to, while the Corn Tax is simply a transfer of wealth from American drivers to a very politically powerful and parasitic “industry” that depends on government force to keep it in business.
Ethanol is a product without a natural market – which is why the corn lobby had an artificial one created for it, using the political power it wields in farms states to apply pressure to candidates for office to support laws such as the Renewable Fuels mandate. It’s no different in principle than the “zero emissions” mandates in place in states like CA, which created an artificial market for electric cars by imposing a requirement that a certain number be sold each year.
The chief difference – for now – is that Americans aren’t forced to buy an electric car. But the corn lobby has succeeded in sluicing corn juice into almost all of the “gasoline” sold in the country.
It is still legal to buy real gas (without ethanol) just as it’s still legal to buy real Coke (with sugar rather high fructose corn syrup) but you have to go out of your way to find it. There are only a relative handful of stations – see here, to find some – that sell real gas because of the pressure on the system to produce and sell ethanol-laced gas.
The two products have to be pipelined/shipped/trucked/stored separately, which makes things more involved, which makes things more expensive. It’s cheaper to sell just (or mostly) the ethanol-laced gas – just as it’s cheaper to sell Coke sweetened with high fructose corn syrup but only – in the case of E10 – because of the artificial incentives created by the mandates and the compliance costs they impose.
And it’s actually not cheaper.
First, ethanol-doused gas reduces gas mileage – because it doesn’t pack nearly the same energy punch that 100 percent gasoline does. It takes 1.5 gallons of pure ethanol to equal the energy content in BTUs of 1 gallon of unadulterated gasoline.
The more ethanol in your “gas,” the lower your gas mileage.
This can be compensated for to some degree by designing an engine specifically for ethanol-laced fuels (which have higher octane) using very high-compression and turbochargers to increase cylinder pressure – but this increases the cost of new cars built with engines designed to take advantage of the higher-octane/ethanol-laced fuel.
And the fuel is a clear net loser when burned in cars not designed specifically to burn it – which amounts to millions of cars still on the road and especially cars made before the early 2000s.
The government itself admits that E10 “gas” reduces MPGs by 1.5-3 percent on average – a reduction significantly greater than the gains achieved by fitting new cars with engines that turn themselves off whenever the car isn’t actually moving (ASS) and leaving aside the add-on cost of such technology and the down-the-road costs in terms of maintaining the system and more frequent battery replacement due to the much-increased workload of serial re-starting of the engine placed upon it.
If a car burns 1.5-3 percent more fuel by volume to go a given distance, it will “emit” proportionately more of the dread gas, carbon dioxide. Why aren’t environmentalists “concerned” about this?
The corn lobby may soon find Greta directing her crazy eyes in their direction.
But for now, the corn lobby is very angry that the Orange Man has dialed back the manufactured “demand” for its product. It sent him a letter expressing “frustration” with the president’s decision.
This is the “frustration” felt by a raccoon stymied by one of those lockable garbage can tops.
The letter demands the Orange Man “follow the law” – that is, not question the forcible transfer of wealth from the pockets of American drivers into the coffers of the corn lobby. It wails about the “reduced corn demand due to lower ethanol blending and consumption and a rising number of ethanol producers slowing or idling production.”
It goes on to wheedle about the “harm caused by the waivers ” . . . but what about the harm caused to American drivers?
It insists that the OM “restore integrity” to the renewable fuels mandate by rescinding the 85 waivers he has granted to refineries around the country.
What the Orange Man ought to do is make them permanent – and general.
If people want E10 – or E15 or E100 – let them buy it.
But force no one to buy it.
This would articulate the principle that it’s not the proper business of government to “help” any businesses that can’t make a case for their product or service on the merits.
The choice isn’t between “renewables” and real gas.
It’s between a kleptocracy – and a free market.
. . .
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