Guest opinion: Repeal U.S. ethanol mandate

May 27, 2017

Scam best describes the ethanol mandate that’s paying huge dividends to corn farmers and ethanol producers but is inflicting economic pain across the country.

As President Trump ponders what should be done to improve the economic well-being of ordinary Americans, he should zero in on the renewable fuel standard, one of the worst statutes money could buy. Repealing it would save billions of dollars.

Proponents of the RFS, which mandates the blending of ethanol into gasoline and diesel fuel, promised all kinds of benefits they did not deliver. They claimed that the use of domestic biofuels would reduce U.S. dependence on imported oil, but imports were already falling before the ink got dry on the RFS. As it turned out, America achieved energy independence without help from ethanol. Today, the United States is the world’s biggest producer of oil and natural gas, thanks to the boom in shale production.

Due to the RFS, ethanol is consuming 40 percent of the nation’s corn production. Implemented in 2005, the RFS requires huge increases in ethanol, rising from 4 billion gallons in 2005 to 16 billion gallons in 2017 and 36 billion gallons by 2022. Since the law’s passage, the price of corn has more than doubled, raising the price of feedstock for poultry, dairy, and cattle. This has strained family budgets, but it’s also curtailed U.S. food exports to impoverished countries in South Asia and Africa, resulting in food shortages and famine.

A number of scientific studies have shown that the environmental benefits from ethanol are far fewer than its advocates had claimed. For one thing, ethanol reduces carbon dioxide only slightly compared with straight gasoline, partly because large amounts of fossil fuels and nitrogen fertilizer are needed for corn production. And the runoff from nitrogen fertilizer has created a 5,000-square-mile dead zone at the mouth of the Mississippi River in the Gulf of Mexico.

In large parts of the Midwest, water tables have nosedived due to heavy water use for irrigation. And millions of acres of prairie tallgrass have been plowed under for corn production. The largest losses have been in areas close to ethanol refineries.

Nationally, the ethanol mandate requiring the production and use of E10 (10 percent ethanol, 90 percent gasoline) has meant that motorists must pay for a fuel that provides fewer miles per gallon than conventional gasoline. Consequently, motorists must fill their tanks more often. And because ethanol contains less energy than oil, using it is gasoline does not lower emissions since more fuel must be consumed. And if a motorist uses E15, there is the added risk of engine corrosion.

All of this adds up to a boondoggle for highly-subsidized corn farmers and ethanol producers. Anyone who doubts the power of the corn lobby should consider that between 1995 and 2014, corn farmers received $94.3 billion in price subsidies, price supports and tariffs, according to the Environmental Working Group.

Eliminating the ethanol mandate is the right thing to do. It would create jobs in the oil and gas industry, enhance the environment, reduce the federal deficit, and lower corn prices. The mandate is a relic from the past that serves no worthwhile purpose, fattening the pockets of agribusiness and ethanol producers. Congress needs to act now.