Ethanol subsidy supporters, foes press cases

Argus Leader, Thom Gabrukiewicz
Published November 19, 2008

Calling ethanol a 30-year-old slacker living in America's basement, a broad-base coalition on Tuesday called for President-elect Barak Obama and the new Congress to phase out ethanol subsidies. But the ethanol industry, led by Sioux Falls-based Poet Energy, said that even though corn prices have fallen 50 percent since June, the food industry has kept its prices high to maximize profits. The food industry also has benefited from $55 billion in government subsidies of its own, ethanol backers say. Organizations including the National Turkey Federation, National Taxpayers Union, Environmental Working Group and the World Wildlife Fund came together in Washington, D.C., to decry the 30th anniversary of the first federal subsidies for ethanol. Advertisement "Ethanol has been on the government payroll for 30 years," said Joel Brandenberger, president of the National Turkey Federation. "Most people at 30 move out of their parents' homes. The ethanol industry is in significant need of reform." But an energy policy that supports ethanol is good for the country, said Bruce Rastetter, chief executive officer of Hawkeye Renewables and founding board member of Growth Energy.Tuesday's news conference was the latest salvo in the food vs. fuel argument. Food Before Fuel officials say that the government-sponsored diversion of more than one-third of the U.S. corn crop to ethanol production has led to historically high and unstable commodity prices. Compounding that is the recent Environmental Protection Agency mandate that sets the 2009 Renewable Fuel Standard at 11.1 billion gallons of ethanol to be blended into the nation's gas supply next year. The target level is 36 million gallons of ethanol mixed into the nation's gas supply by 2022. "Despite the subsidies, ethanol is not competitive in the marketplace, and the industry only survives because politicians shovel our money into their pockets," said Duane Parde, president of the National Taxpayers Union. Growth Energy officials called on the Grocery Manufacturers Association, a Food Before Fuels partner, to stop what the energy group said are deceptive attacks on the ethanol industry. "The federal government has an important role in supporting programs that promote the common good," said Dave Vander Griend, president and chief executive officer of ethanol plant designer ICM Inc., and a founding board member in Growth Energy. "Whether by funding anti- poverty programs like food stamps or championing renewable energy that will jump-start our green economy and create jobs, we believe that it is good public policy to make smart investments for our nation's future."