What takes more courage in this Tea Party, deficit-hawk atmosphere among Republicans — opposing ethanol subsidies in Iowa, or professing support for federal price interventions? Mitt Romney clearly believes it’s the latter:
It was an odd setting for a policy pronouncement, but on the sidewalk outside the Historical Building here, former Massachusetts Gov. Mitt Romney embraced ethanol subsidies. It came just days after and blocks from where his rival for the Republican presidential nomination, Tim Pawlenty, said the subsidies should be phased out.
“I support the subsidy of ethanol,” he told an Iowa voter. “I believe ethanol is an important part of our energy solution for this country.” Iowa leads the nation in the production of corn, a main source of ethanol.
Really? Ethanol may be “an important part of our energy solution,” but that would only be true if ethanol could compete without price supports. Ethanol is hardly an emerging technology that needs federal support for R&D. It’s a mature technology, and federal subsidies exist solely to artificially lower its price at the pump to make it competitive with gasoline.
Furthermore, the use of food to feed gas tanks is one of the worst ideas we’ve had in green energy. The IMF made that point almost three years ago, declaring that the destruction of corn for ethanol had exacerbated food crises and also contributed to worldwide water shortages. A year later, the Congressional Budget Office blamed federally-subsidized ethanol production for hiking food prices. They estimated that the US would issue nearly $1 billion in extra food stamps in 2009 because of the inflationary pressure caused by its subsidization of ethanol production.
Not only are we paying a hidden price at the pump for these subsidies to make ethanol look better as a solution, we’re paying more at the grocery store and more in entitlement spending to boot. Hey, what’s not to like for a conservative?
Pawlenty went to Iowa and told the truth — that the federal government’s subsidies of ethanol were bad policy that we can no longer afford. Romney went to Iowa and pandered for big-government solutions in a market that should either be standing on its own two feet by now or putting resources into other solutions instead. Which candidate showed political courage?