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Ethanol is making a point that Big Oil is receiving subsidies and ethanol isn't

Ethanol is holding one huge, sarcastic birthday party for Big Oil in celebration of its oldest subsidy enacted 100 years ago.

The 100th birthday for oil's oldest subsidy -- which began in 1913 -- will be prepared by the Iowa Renewable Fuels Association (IRFA), which promotes Iowa ethanol and biodiesel growth, and the American Coalition for Ethanol (ACE), which encourages the production and use of ethanol.

“And it dawned on us a few months ago that this is in fact the 100th birthday for oil subsidies and this calls for a party, and I think people can assume our tongues are firmly planted in our cheeks when we say we’re going to celebrate that fact,” said Monte Shaw, executive director of IRFA.

Why is the ethanol industry doing this? According to Shaw, the ethanol blenders tax credit expired in 2011, and ethanol has been forced to continue on without any help. However, Big Oil, which is already the most profitable industry in the world, still receives subsidies. The oldest, continuous subsidy was enacted in 1913, which is the topic of the birthday party.

“What we’re saying is, they’re there," said Shaw. "And we’re sick and tired of members of Congress who don’t know any better or don’t want to know any better, saying, oh, why do you need the RFS?  Why do you this, why do you need that? Can’t you just compete on a level playing field? When the fact of the matter is, our competition has had 100 years of subsidization. They’ve had nearly 40 years of a petroleum mandate written into federal law that says unless you drive a flex-fuel vehicle, you will purchase gasoline with a minimum amount of petroleum (85% percent of petroleum). The playing field is overwhelmingly tilted to the oil industry and that has got to be a part of all discussions around the RFS."

The RFS is the Renewable Fuel Standard, which is a U.S. federal program that requires transportation fuel to have a certain amount of renewable fuels when sold in the U.S.

The birthday party, called "Century of Subsidies," will be held on Thursday, March 14, 2013 from 2:30 p.m. to 3:30 p.m. at 430 Dirksen Senate Office Building in Washington DC.

There will be cake.


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Sour grapes...
By ppardee on 3/13/2013 12:21:09 PM , Rating: 1
The government shouldn't be in the business of picking winners and losers (and, in fact, they only pick losers) The Ethanol industry can't say "Oil companies shouldn't get subsidies" while begging for their own.

RE: Sour grapes...
By PresidentThomasJefferson on 3/13/2013 12:52:28 PM , Rating: 3
all these are gov inventions funded by gov spending/gov

1) antibiotics/penicillin
2) X-rays & X-ray machines
3) internet
4) HTML internet browsers that all later HTML browsers are based on
5) GPS

6) nuclear power (took over 30 years of gov funding/subsidies too before it became profitable enough for the private sector to join in)

7) MRI machines
8) radar invented by Naval Research laboratory

9) biotechnology/genetic engineering (that makes most drugs now)
the 'Green Revolution' that increased crop yields by 30x-50x (depending on crop) was directly the work of Dr. Norman Borlaug who won a Nobel Prize for it --and his education in botany/biology was from a FDR New Deal program
addition to his direct gov reseach to increase crop yields that averted global starvation despite the huge population growth
-- production increased so much
the US pays farmes NOT to farm & buys THOUSANDS of tons of SURPLUS milk, cheese, corn, etc EVERY YEAR --production is actually kept artificially down to keep prices up

10) the food safety lining that lines the insides of aluminum soda cans & food was developed by NASA

11) QuikClot for instant cauterizing of wounds also by NASA scientist
12) AK-47 proof body Interceptor tungsten carbide armor invented by Marine Corps research institute

as well as commissioning & funding these things to private contractors:
a) computers
b) lasers

RE: Sour grapes...
By StanO360 on 3/13/2013 1:37:30 PM , Rating: 2
You're talking about fundamental research, not many people will argue against that. First of all that's relatively cheap. Subsidizing industries is a whole different concept.

RE: Sour grapes...
By ebakke on 3/13/2013 1:38:45 PM , Rating: 2
What's your point?

No one said all gov't spending is wasted. No one said gov't spending can't produce something of value. The argument is, and always has been: at what cost? Living in a world of limited resources, there's always an opportunity cost when we take from X to give it to Y. X can no longer invest that money into something else. We may have gotten antibiotics at the cost of a cure for cancer.

Then there's the cost of freedom, when you put a gun to someone's head and say "give me Z% of your money, or you go to jail."

Lastly, you're implying that your list is contains things that could only have been created by gov't spending. And without the gov't, we wouldn't have nuclear power (for example). Bogus.

RE: Sour grapes...
By PontiusP on 3/13/2013 1:46:02 PM , Rating: 2
Which internet browser did the government make?

Your argument is logically flawed. You're saying that because the government originally came up with something, nobody else ever would have. Given time, all of these things probably would have come about.

RE: Sour grapes...
By Danger D on 3/13/2013 5:05:09 PM , Rating: 2
Given time, alternative fuel would come about. It's subsidized because the govt feels the need to accelerate its development and commercialization.

Corn ethanol subsidy sun-setted, as all should once they hit commercial viability. Oil subsidies, unfortunately, are written into the tax code, so it takes legislative action to remove them.

RE: Sour grapes...
By ppardee on 3/13/2013 4:07:06 PM , Rating: 2
There is a difference between funding research and padding the bottom line of for-profit companies at the expense of the tax payer in order to push your agenda and get more votes from special interest groups.

The issue comes when Obama decides that he wants 'green' energy, so he gives subsidies to solar panel companies. This pushes the cost of business down, allowing the company to sell its products to the public at a reduced price, even below cost. The company wouldn't have been profitable without the tax payers funding it on the back end because its products are too expensive to produce and the market wont bear the additional cost.

Another company comes up with a better energy solution but it can't get a foothold in the market because of the artificially low price of solar panels. Who wins? The politicians who get the solar panel lobby votes and the solar panel companies. Everyone else loses, including the public.

The flip side is that the solar panel industry sees that solar panels won't be widely accepted until they can get the costs down. The government funds research that allows for more efficient and cheaper solar panels that all can use. The solar panel industry adopts this new technology and cheaper solar panels hit the market 5 years later with no additional tax payer funding. Everyone wins.

Subsidies are criminal interference in the market and should be treated as such.

"If you look at the last five years, if you look at what major innovations have occurred in computing technology, every single one of them came from AMD. Not a single innovation came from Intel." -- AMD CEO Hector Ruiz in 2007

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