From Taxpayers for Common Sense

Volume XV No. 28: July 16, 2010

Like a sailor on a late night bender, corn ethanol boosters are belly up to the bar trying to cajole another drink from the subsidy tap before the lights come on. Some in Congress seem all too ready to give in, costing taxpayers billions in the process. But in light of the yawning budget deficit and the failed promise, ethanol should be forced to make its own way in the marketplace.

Like alchemy of old, the idea of turning corn into fuel is an attractive one - a renewable, domestic, more efficient fuel. So for years Congress has lavished a tax credit, import tariff on foreign ethanol, usage mandate, and other subsidies in an effort to give the industry a leg up. But these efforts have yielded as much success as the alchemist had turning lead into gold. And according to a new Congressional Budget Office report, corn ethanol costs taxpayers $1.78 to reduce gasoline consumption by one gallon.

To promote the use of ethanol, we give fuel blenders (generally the big oil companies) a 45 cents per gallon tax credit. That costs more than $5 billion per year. But the Volumetric Ethanol Excise Tax Credit (VEETC) expires at the end of the year, and the industry is scrambling to keep the subsidies flowing.

The Renewable Fuels Association and their allies are trying to get something – anything – in place. The tax writers in the House are considering a proposal to extend the tax credit for another year, but at a lower rate – 36 cents per gallon. That would still cost $3.8 billion. And under budget rules, Congress would have to find offsetting spending cuts or revenue increases to pay for the extension.

Just this week another ethanol enabler, Growth Energy, rolled out a plan to end the subsidies. Well, not really. Sure, they called for phasing out the tax credit – so far so good – but then replace it with infrastructure subsidies so that ethanol could compete in a “fair and open market.” Apparently the irony was lost on them. Instead of tax credits, Growth Energy wants money to pay for pumps at gas stations and pipeline infrastructure. Oh, and a mandate that all vehicles sold in the U.S. be flex-fuel.

Let’s not forget, VEETC isn’t the only subsidy the ethanol industry is bingeing on. There is a renewable fuels mandate to use biofuels, predominantly corn ethanol. The Government Accountability Office has pointed out that this mandate, which will go up to 15 billion gallons by 2015, is the primary driver of ethanol production. So why should we just give billions in tax credits to oil companies to use something they were going to use anyway?

After more than 30 years of subsidies, it’s well past time for the ethanol industry to grow up and stand on its own. In light of our current fiscal situation, we cannot afford to keep picking up the tab. So rather than handing the subsidy-addicted ethanol industry another last swig, Congress should show them the door and let the credit expire at the end of the year. Then taxpayers will have something to toast.

(more…)

From the Competitive Enterprise Institute

Cap and Trade FOIA release

From the Wall Street Journal

Obama’s Nontax Tax

The Perspective Of A Russian Immigrant
By SVETLANA KUNIN | Posted Thursday, August 20, 2009 4:20 PM PT

In the Union of Soviet Socialist Republics, I was taught to believe individual pursuits are selfish and sacrificing for the collective good is noble. In kindergarten we sang songs about Lenin, the leader of the Socialist Revolution. In school we learned about the beautiful socialist system, where everybody is equal and everything is fair; about ugly capitalism, where people are exploited and treat each other like wolves in the wilderness. Life in the USSR modeled the socialist ideal. God-based religion was suppressed and replaced with cultlike adoration for political figures.

The government-assigned salary of the proletariat (blue-collar worker) was 30%-50% higher then any professional. Without incentive to improve their life, professionals drank themselves to oblivion. They — engineers, lawyers, doctors, teachers — earned a government-determined salary that barely covered the necessities, mainly food. Raising children was a hardship. It took four to six adults (parents and grandparents) to support a child. The usual size of the postwar family was one or two children. Every woman had the right to have an abortion and most of them did, often without anesthesia.

There is a comparative historical reality that plays out the consequences of two competing ideologies: life in the USSR and in America.**  (more…)

The psychological state of the militant is distinguished by his fanatical investment in the system.  This central vision reorganizes his entire intellectual and perceptual field, all the way to the periphery.  Language is transformed: it is no longer used to communicate or express, but to conceal a contrived continuity between the system and reality.  Ideological language is charged with the magical role of forcing reality to conform to a particular vision of the world.  It is a liturgical language for which every utterance points to its speaker’s adherence to the system, and it summons the interlocutor to adhere as well.  Code words thus constitute threats and figures of power.It is not possible to remain intelligent under the spell of ideology.

The most obvious sign that ideological insanity is artificial is that it is reversible: when the pressure ceases and circumstances change, one gets out all at once, as if from a dream.  But it is a waking dream–one that does not block motility and maintains a certain apparently rational coherence.  Outside the affected area, which is the superior part of the mind in a healthy person–the part that articulates religion, philosophy, and the “governing ideas of reason,” as Kant would say–the comprehensive functions seem intact but focused on and enslaved by the surreal object.  When one wakes, one’s mind is empty; one’s life and knowledge must be entirely relearned.

Alain Besancon, A Century of Horrors, 2007.

The Republican mistake of the 2008 election was to embrace a portion of the left’s ideological insanity to bring in moderates, which ended up ratcheting the debate to the left.  Whoever concluded that Republicans could score by giving the ball to the opposition should be fired. (more…)

“Because white guilt is a vacuum of moral authority, it makes the moral authority of whites and the legitimacy of American institutions contingent on proving a negative: that they are not racist.  The great power of white guilt comes from the fact that it functions by stigma, like racism itself.  Whites and American institutions are stigmatized as racist until they prove otherwise. . . . .[T]he larger reality is that white guilt leaves no room for moral choice; it does not depend on the goodwill or the genuine decency of people.”  Shelby Steele, White Guilt, 2006.

The moral authority that comes from an absence of moral choice is actually no moral authority.  This is a prescription for endless manipulation–by both blacks and whites–which Steele documents at length.  He also wrote, (more…)

Energy and Environmental Myths, by Drew Thornley of the Manhatten Institute