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Published: Saturday, 9/8/2012

Corn politics

The arid soil created by this year's drought is expected to reduce the U.S. corn crop by 17 percent from last year. That dire prediction is escalating rhetoric about the relative amounts of corn used for ethanol and livestock feed.

The U.S. Environmental Protection Agency should resist exaggerated claims by governors in livestock-producing states who seek to appease farm lobbyists. But the EPA may have to grant some waivers from a renewable-fuel standard that requires 40 percent of this year's corn crop to be set aside for ethanol production. Otherwise, the rising cost of food will be harder to curb.

The outcome of this debate could affect ethanol-producing plants in northwest Ohio and southeast Michigan. But it gives Congress an opportunity to rethink its corn policies for the long term.

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Critics have long dismissed ethanol as a boondoggle. They argue it provides only a marginal increase in energy independence and little relief at the gasoline pump, without much reduction in greenhouse gases. They say ethanol provides corporate welfare for major corn growers, but has done little to change Americans' driving habits.

Some caution is in order. The Renewable Fuels Association calculates that waivers to the ethanol standard could cost individual households $24 to $85 more in 2013. While those households might be able to reduce annual food expenses by $3 to $9 if more corn is diverted to food production, the group claims, those savings would be more than wiped out by higher fuel prices.

Corn prices are expected to rise by as much as 25 percent because of the drought. Ethanol critics cite the fuel standard as a key factor in the quadrupling of corn prices since 2005. The United Nations is urging the United States, which grows much of its corn for international food markets, to scale back its production of corn-based ethanol.

Congress should re-examine corn's role in food and fuel production. But it also should examine the effectiveness of other technologies at reducing greenhouse gases and reliance on foreign oil.

If lawmakers decide to revisit a 2007 law that requires 36 billion gallons of renewable fuel to be blended into gasoline by 2022, it should remember that not all such fuel comes from corn. The goal, whatever the technology, should be to achieve the cleanest and most efficient ways to produce energy. Usually, that means less reliance on fossil fuels.

A rare bipartisan coalition in Congress allowed a 45-cent-a-gallon federal tax credit for ethanol to expire this year. The tax credit, which lasted more than three decades, provided more than $25 billion in subsidies to oil refiners that mixed ethanol with gasoline. It cost the government nearly $6 billion in 2011.

The Government Accountability Office says increasing demand for ethanol production has contributed to higher corn prices, which, in turn, have increased food costs. This summer's drought, one of the worst in decades, accentuates those concerns. As it debates the politics of corn, Congress must put consumers' needs ahead of producers'.



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