Ethanol tax credits are getting bipartisan disapproval
TEXT OF STORY
STEVE CHIOTAKIS: Seventeen years ago, then-Vice President Al Gore, presiding over the Senate, broke a tie and voted to keep ethanol tax credits alive. Today, Gore calls that vote a mistake. And so do a lot of other folks who say it’s subsidizing corn farmers.
As Marketplace’s Sarah Gardner reports from the Sustainability Desk, there’s a movement now to end ethanol subsidies.
Sarah Gardner: This may be the only issue that many liberals and Tea Party activists agree on. Both MoveOn.org and FreedomWorks have signed a letter urging Congress to let the 45-cent per gallon ethanol subsidy expire at the end of the month. A bipartisan group of 17 U.S. senators wrote a similar missive. So what’s with this sudden left/right lovefest?
Nathaniel Greene: It’s because of the uniquely bad nature of ethanol policy these days.
Nathaniel Greene is with the Natural Resources Defense Council. He says the government shouldn’t be backing the corn-based fuel.
Greene: It has more global warming pollution than gasoline. And it’s costing taxpayers about $5.5 billion this year and about $6 billion next year. So both fiscal conservatives and environmentalists are feeling like it’s time to stop wasting our money.
But Jeff Broin begs to differ. He’s CEO of POET, the largest ethanol producer in the world.
Jeff Broin: The ethanol tax credit has a tremendous return to the United States government. Just in tax revenues alone from the industry, it offsets itself by about two to one.
Broin also says cutting ethanol support will hurt investor confidence in the next generation of biofuels, like switchgrass. Although ethanol’s under fire right now, it still has some support in Congress, especially from farm belt lawmakers. The Center for Public Integrity reports that ethanol-related groups gave almost $1 million to nearly 200 candidates in the past two election cycles.
I’m Sarah Gardner for Marketplace.
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