Contradictions Abound, Vitriol at All-time High

By Mike Bryan | March 11, 2011

Contradiction rather than collaboration seems to be the order of the day with ethanol in Washington, D.C. Anyone who has been involved in this industry for a few years will be quick to point out that controversy has always swirled around ethanol. While true, it seems to me that the vitriol with which the controversy is currently being espoused is at an all-time high. In addition, the contradictions on ethanol occurring within the government itself are alarming.

The EPA acted positively by allowing a 15 percent ethanol blend, but then provided a dismal report to Congress on the environmental impact of biofuels created by the implementation of the renewable fuels standard. The House of Representatives voted to stop the implementation of E15, claiming it was wasteful spending, while at the same time voting down a bill introduced by the Democrats to repeal tax incentives for big oil. The logic in voting down the bill expressed by Rep. Hal Rogers, R-Ky., was interesting, to say the least. “It would single out one industry and increase their cost of doing business,” he said. “This misguided policy can only lead to higher energy prices, continued reliance on foreign oil and economic hardship that hampers job creation." That argument does have a familiar ring about it.

At the same time the House was voting to stop funding for blender pumps, a report commissioned by the Renewable Fuels Association shows that requirements of the RFS could be met with ethanol if just one-third of the nation’s 162,000 service stations installed blender pumps that dispensed 10 to 85 percent ethanol. Economist John Urbanchuck showed in a recent study that more than 70,000 jobs are directly attributable to the ethanol industry in America.

The Obama administration is pushing hard for continued development of the biofuels industry and at the same time, the Government Accountability Office is saying that the tax incentives provided the ethanol industry are wasteful spending. Billions of dollars are slated to be cut from programs that have high levels of redundancy, yet Congress doesn’t seem to see the billions of dollars in oil industry profits and the billions of dollars in tax incentives provided the oil industry as redundant. The ethanol industry tax incentives, however, are targeted as wasteful. Really!

In a recent speech to the Growth Energy Leadership Conference Tom Buis of Growth Energy said it well: “In the past month, gas prices have increased 25 cents, costing Americans $100 million a day. How many times must we hit the snooze button before our nation begins to seriously reduce our addiction to foreign oil?” Northern Africa is teeming with conflict and threatens to cause major oil disruptions and price hikes. At a time when the U.S. economy has been significantly weakened, $100 million dollars a day is more than significant, it’s catastrophic.

Cutting wasteful spending is a noble goal indeed. Making a political sideshow out of it and targeting segments of the economy that one does not personally support is misrepresentation. We elect people to federal and state government to lead, to legislate, to represent the interests of their constituents. What we are experiencing rather than representation, however, are personal and political vendettas being played out on a scale that is almost unequalled in history. Rather than conducting a well-thought out and serious effort to target wasteful spending, Congress has taken a wild, shotgun approach to budget cutting—if it moves, shoot it! Just don’t point the gun at my pet project.

That’s the way I see it.

Author: Mike Bryan
Chairman, BBI International