Perhaps as a sign that Tea Party ideas have won a cache going beyond just the election of favored candidates to public office, a bi-partisan group of senators has signed a letter calling for an end to ethanol subsidies.
According to the Washington Post, the letter, “–was authored by senators Dianne Feinstein and Jon Kyl, and includes a number of Democrats and Republicans, including John McCain, Susan Collins, Richard Burr, and Mike Enzi. This is key, because the question of whether the subsidies should expire is emerging as a key test — just like earmarks — of whether Republicans are serious about reining in spending and the deficit.
“While this issue could divide Dems along regional lines, it’s more directly relevant to the GOP. With leading GOP senators now coming out for letting the subsidies expire, this could up the pressure on Republican senators who backed the subsidies in the past, such as Chuck Grassley and Orrin Hatch, putting them on the wrong side of what may emerge as a key litmus test for the Tea Party and potentially dividing the GOP caucus.”
The letter also called for an end to tariffs on ethanol imports, primarily from sugar-producing countries such as Brazil and India. The letter suggests that ending ethanol subsidies will save about $32 billion over five years. The requirement to use ethanol in gasoline would remain, however.
Using corn to create ethanol, in effect transforming food into fuel, has been controversial. Creating corn-based ethanol has resulted in food inflation that has strained family budgets and has even resulted in greater hunger in the Third World. Corn is not only eaten directly, but is used as feed for livestock, ingredients for food such as corn tortillas, and as a sweetener in the form of fructose corn syrup.
Ending corn-based ethanol subsidies and switching to some non -ood plant, such as switch grass, would be a no-brainer policy change except for one fact: Iowa, the first presidential caucus state in the nation, is a big producer of corn. Iowa corn farmers like their subsidies.
Ending subsidies and tariffs on ethanol imports would be of vast benefit to the American people in reduced food and fuel prices, besides taking a significant cut out of the budget deficit. But ending it would require something from politicians that they too infrequently display-courage.
Those members of Congress, especially the Senate, who have presidential ambitions are going to have to do a little soul-searching to see where their political interests lay. Even potential candidates who are not in Congress — Pawlenty, Romney, Huckabee, and Sarah Palin come to mind — are going to be asked their opinion on ending corn-based ethanol subsidies.
On the one hand, if they favor ending the subsidies, they risk not winning or even doing well in the Iowa Caucus. On the other hand, if they favor keeping the subsidies or even get all wobbly about the question, they will surely anger the Tea Party.
Of course, the number of people who lost in Iowa who later became president include Ronald Reagan, George H. W. Bush, and Bill Clinton. Even Jimmy Carter, whose good showing in the 1976 Iowa Caucus propelled him to front runner status and eventually the presidency, placed behind “uncommitted.”
So it is entirely possible that a shrewd Republican candidate might choose to give the Iowa corn farmers a little tough love, telling them that they can’t rely on Uncle Sugar any longer, take the loss, and then go on to acclaim and glory as someone who placed the national interest before their political interest.
Source: Bipartisan group of senators calls for ethanol subsidies to expire, Greg Sargent, Washington Post, November 30th, 2010