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Friday, June 17th, 2011

Corn Ethanol: Senate Votes to End Credits, Tariffs

Author:     CAROLYN LOCHHEAD
Source:     San Francisco Chronicle
Publication Date:     Thursday, June 16, 2011
 Link: Corn Ethanol: Senate Votes to End Credits, Tariffs
Stephan:   Here is some wonderful news. The corn lobby has been overcome and this will go a long way towards relieving the corn for energy, corn for food juxtaposition that has caused so much stress on the world's food supply. It will also reduce the massive pollution arising from the use of fertilizers in the cultivation of corn for energy that has been washing into the nation's waterways. Most who have looked at this issue believe that it was this runoff that was the cause of the algae blooms in the Gulf that were so damaging to that already heavily degraded eco-system.

WASHINGTON — The Senate cracked Republican orthodoxy on taxes and undermined the once-impregnable political support for corn subsidies in an overwhelming vote Thursday to kill tax credits and tariffs for corn ethanol for the first time in more than three decades.

A combination of record corn prices, which are damaging poultry, dairy, cattle and hog farmers, and rising alarm over the chronic $1.5 trillion deficit forced lawmakers to take a second look at how the nation spends its money.

California Sen. Dianne Feinstein, a Democrat, and Oklahoma Sen. Tom Coburn, a Republican, joined forces on an amendment to eliminate a 43-cent-a-gallon tax credit for corn ethanol that is paid to oil refiners and a 54-cent-a-gallon tariff that blocks more energy-efficient sugar ethanol, mainly from Brazil.

Gas mandate remains

An additional federal mandate that refiners add a 10 percent blend of ethanol to gasoline would remain. The amendment passed 73-27.

‘If we’re going to carry out the mandate of a prudent government, we’ve got to start making changes,’ Feinstein said, predicting more cuts ahead. The ethanol subsidy has cost $22.6 billion since 2005.

Ethanol tax credits are a classic ‘tax expenditure,’ a tax break that is equivalent to a cash payment because it awards a direct financial […]

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