What the New Year brings us

With little fanfare, the federal government will no longer subsidize ethanol in 2012.  This subsidy has been a thorn in the sides of many, and now, it is no more.

Here is what happened.  First,

[the] Senate voted overwhelmingly against continuing the 45-cent-a-gallon ethanol credit in July…

And then,

Congress adjourned [in December] without extending the $6 billion annual tax subsidy for blending corn ethanol into gasoline…

Perhaps, it is worth noting what the National Academy of Sciences had to say about corn ethanol.

[Grain ethanol] could not compete with fossil fuels in the U.S. marketplace without mandates, subsidies, tax exemptions and tariffs…

Let’s pull all of this together. 

It costs oil companies money to blend this crap into our gasoline.  The federal government will no longer pay for this with your tax dollars.  But, the federal government still insists that your “gasoline” contain at least 10% ethanol.  Who do you think will now pay the “‘blending” costs?

That would be you, the consumer, in the form of higher gasoline prices.

Well, look at the bright side.  Maybe the administration will use this $6 billion a year to reduce our deficit, or, give taxpayers a $6 billion a year tax cut.  Then again…

Happy New Year from your federal government.


22 replies
  1. Lynn
    Lynn says:

    SOS, no surprise the dysfunctional federal government uses no logic. Is it a Congressional law or a Department of Energy that “insists that your gasoline contains at least 10% ethanol”? Or is it some other mandate? Can we put pressure to change this, and if so where?

  2. GdavidH
    GdavidH says:

    I?could only?hope that the mandate for the 10% blend is removed. Leave it to the free market now that the ethanol is not going to be subsidized. If you are someone who falsely believes that ethanol in your gas is saving the planet from fossil fuels, go pay more for your gas?at the pump that still dispenses the blend. I’m sure if there is still enough demand for it the gas companies will still make it. You might even see a boon in new businesses catering to the corn fuel crowd, similar to the electric car only companies that do so well.

    • Dimsdale
      Dimsdale says:

      The really humorous part of that is that the ethanol gas nobody buys will sit and age, and when the greenies pump it into their Priuses, it will trash the engine ever so quickly.? I understand Priuses are especially quiet and economical when not running….? ;-)? They are still ugly though…

  3. sammy22
    sammy22 says:

    Fret not. Brazil will be happy to export more ethanol to the US in spite of the $.54 /gal tariff imposed on it.

  4. JBS
    JBS says:

    Yo, Happy New Year to y’all!
    The net result is agribusinesses that grow massive amounts of corn will still reap record profits (due to the still mandated ethanol requirement).
    With so much of the corn being taken off the food market, the price of food stuffs will climb precipitously. Everything made with high fructose corn syrup (ugh) will be that much more expensive, e.g. soda. Meat will be more as corn is used in feedlots; pet food will cost more. Corn derived plastics (PLA) will be more. (Without a subsidy, the market price of corn will “float” only upward.)
    Ethanol will continue to corrode our small engines. Everything that runs on the blended “gasoline” will be negatively effected. All that Congress has done is shift the onus of the true cost of ethanol from subsidies to an “in your face” price-hike at the pump, etc. We have been paying for the ethanol production all along.?
    Does anyone think that your taxes, state or federal, will go down as a result of this? As likely as the Congress applying the $6 billion to the debt! PLA link: http://en.wikipedia.org/wiki/Polylactic_acid

  5. essneff
    essneff says:

    It never made a bit of sense to blend “moonshine” into our gasoline…… it actually forces one to buy more gasoline due to the ineffcienies from?blending the moonshine?by the ?crappy performance it promotes……. I wonder why we haven’t heard any Republican?candidate except Pawlenty (long gone)?call for?the 10% requirement to be eliminated…….. oh that’s right, the first caucus is in Iowa!!?????

  6. sammy22
    sammy22 says:

    Phillips66 has gas without ethanol. Perhaps due the “great” demand for the product in N.E., the company could be enticed to open gas stations there. You know: demand and supply or viceversa.

  7. Lynn
    Lynn says:

    Are you kidding? If this is for real, great community service, Sammy. I’ll look up Phillips 66, on the web. Maybe Malloy will bring them here to employ Nutmeggers.

    • essneff
      essneff says:

      actually Dannel P. would never do this……. he’s an Al Gore believer…… a true progressive, gas without?ethanol….. No way!! ?He wants you in a Nissan Leaf…… better yet, a Chevy Volt……?He’ll still be driven around in?a limo that gets 6 mpg, so he can “ah er ha” travel the state & spew his propaganda!????

  8. PatRiot
    PatRiot says:

    This is pretty typical of the government.? They fund it (?with our tax dollars)?to get started and make someone else (the oil companies)?the bad guy who have to raise their price.??And we, the taxpayers, have a new mandated expense,?as if the rate of inflation isn’t sucking us dry.??This is basically?another step towards financial slavery.
    And the salt in the wound is that ethanol?is?less efficient and wears out our equipment faster.???

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