I think I have a basic understanding of public choice theory, and how special interests can use political power to extort money from the rest of us. However, I cannot understand the tremendous political power of the agricultural lobby, especially the corn growers. Only 2-3% of the American workforce is directly employed in agriculture, and I’m sure the corn growers are only a fraction of that small percentage. And yet, the industry continues to receive massive subsidies in the face of opposition by groups as diverse as the Alliance of Automobile Manufacturers, the Motorcycle Industry Council and the Outdoor Power Equipment Institute, the American Lung Association, the Union of Concerned Scientists, the Natural Resources Defense Council, and the Sierra Club.
Everyone Hates Ethanol, The Wall Street Journal Opinion Journal (Mar. 16, 2009).
Americans are unlikely to use enough gas next year to absorb the 13 billion gallons of ethanol that Congress mandated, because current regulations limit the ethanol content in each gallon of gas at 10%. The industry is asking that this cap be lifted to 15% or even 20%. That way, more ethanol can be mixed with less gas, and producers won’t end up with a glut that the government does not require anyone to buy.
The ethanol boosters aren’t troubled that only a fraction of the 240 million cars and trucks on the road today can run with ethanol blends higher than 10%. It can damage engines and corrode automotive pipes, as well as impair some safety features, especially in older vehicles. It can also overwhelm pollution control systems like catalytic converters. The malfunctions multiply in other products that use gas, such as boats, snowmobiles, lawnmowers, chainsaws, etc.
That possible policy train wreck is uniting almost every other Washington lobby — and talk about strange bedfellows. The Alliance of Automobile Manufacturers, the Motorcycle Industry Council and the Outdoor Power Equipment Institute, among others, are opposed, since raising the blend limit will ruin their products. The left-leaning American Lung Association and the Union of Concerned Scientists are opposed too, since it will increase auto emissions. The Natural Resources Defense Council and the Sierra Club agree, on top of growing scientific evidence that corn ethanol provides little or no net reduction in CO2 over the gasoline it displaces.
(HT Carpe Diem)