Posted by Jonathan Adler:
EPA's Chooses Ethanol Over Sound Environmental Policy:
http://volokh.com/archives/archive_2008_08_10-2008_08_16.shtml#1218581918
Last week, the Environmental Protection Agency (EPA) [1]denied Texas'
request for a temporary reprieve from federal ethanol mandates.
Under the energy law signed late last year, 9 billion gallons of
ethanol and biodiesel must be blended into gasoline between Sept.
1, 2008, and Aug. 31, 2009, to meet a national Renewable Fuels
Standard. Texas Gov. Rick Perry (R) sought to reduce that to 4.5
billion gallons, on the grounds that the mandate is hurting
livestock producers and increasing food costs.
In denying the request, the EPA explained that it did not believe the
mandate was having too great an impact on food and fuel prices, and
that whatever costs the mandate imposed were outweighed by the
mandate's benefit. The ethanol mandate "is strengthening our nation's
energy security and supporting Americans' farming communities,"
Administrator Stephen Johnson explained. Funny thing, I thought the
EPA's job was environmental protection, not subsidizing farmers or
promoting something as nebulous as "energy security." The mandate
cannot be justified on environmental grounds, however, as the ethanol
mandate does more harm than good.
Texas Governor Rick Perry is none too happy with the EPA's decision.
He [2]writes in today's WSJ:
the diversion of our corn supply from grocery stores to gasoline
pumps has caused the price of corn to spiral out of control. Corn
prices were once driven by market forces. Today they are
artificially driven up by a government mandate. In 2004, before the
mandates were imposed, the cost of corn hovered around $2 per
bushel. Now it is close to $8 per bushel.
This is driving up the cost of staple food items at the grocery
store. And it is also driving up the price of corn-based feed,
devastating the livestock industry to the point that Texas cattle
feeders have been operating in the red since 2007. . . . .
Denying Texas's request is a mistake that will continue to force
families to bear a heavier financial burden to put food on the
table than necessary and harm the livestock industry.
Supporters of the ethanol mandate have their hearts in the right
place if they want to diversify this nation's fuel supply. But
artificially propping up an industry to the detriment of the vast
majority of Americans is bad policy. And that's what this mandate
does.
This is hardly the EPA's first bad, anti-environmental effort to prop
up the ethanol industry. During the Clinton Administration, the agency
sought to impose a de facto ethanol mandate in the guise of a
"renewable oxygenate" standard under the Clean Air Act. The problem
was, the Clean Air Act did not provide the agency to impose such a
requirement -- and a good thing too, as the mandate would have done
more environmental harm than good.
The Clinton Administration's effort could be ascribed to the
ethano-philia common among D.C. politicians who hope to curry support
in the farm belt and bolster their reelection efforts. But the Bush
EPA has no such an excuse. No crass political motive appears to
explain the Agency's decision. Rather, it seems, the Bush EPA actually
believes in this bad policy.
References
1.
http://www.washingtonpost.com/wp-dyn/content/article/2008/08/07/AR2008080702758.html
2.
http://online.wsj.com/article/SB121850115460131741.html?mod=opinion_main_commentaries
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