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Con: Pushing of ethanol shows Congress not serious about oil independence

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Matt Auer
May 31, 2008
— Smart energy policy amounts to more than pleading with Saudi leaders to ramp up oil supply or lower oil prices — as Sen. Hillary Clinton observed on the occasion of President Bush’s recent Middle East trip.

However, Clinton’s own plan to give drivers a gasoline tax holiday is equally dubious energy policy. Lower the price of something people dearly want and pretty soon, you’re back where you started. Demand picks up and prices increase. And more gas — a scarce good — gets used up more quickly.


Clinton’s colleagues in Congress are also underachieving on the gas price issue. Strong majorities in both chambers insist that the president cease buying oil for the Strategic Petroleum Reserve. The extra gasoline for summer travelers promised by such a measure is roughly the equivalent of a few quick squeezes of the gas pump each time a driver gasses up between now and Labor Day.


Congress’ ability to make genuine progress on this issue is deeply constrained by past Congresses’ passivity and lack of political will. Consider that in 1992, lawmakers killed a proposal to raise the corporate average fuel economy of new cars and trucks. An additional 15 years passed before Congress got serious about CAFE.


The legacy of policy missteps is also illustrated by Congress’ decades-old romance with corn ethanol.


If only lawmakers’ unflagging zeal for corn ethanol could be tapped as an energy source. Researchers are divided on whether the net energy value of corn ethanol (energy content of ethanol minus fossil energy used to produce ethanol) is positive or negative. Also, corn ethanol doesn’t appear to be as “carbon friendly” as once thought.


Idle lands converted to corn production release carbon to the atmosphere; this happened a lot in 2007 when around 93 million acres of corn were planted — up 16 percent over 2006. More corn production also means more inputs of energy-intensive and polluting fertilizers and pesticides, not to mention more water.


But corn’s truly fatal flaw is that every kernel used for energy is necessarily not used for food production. Less corn grown for food coupled with higher energy and fertilizer costs have led to a near tripling of corn prices since early 2006. Cellulosic ethanol may have a brighter future than corn as an alternative fuel, but major technological and cost hurdles remain. Congress placed bets on cellulosic ethanol in the 2007 Energy Independence and Security Act instead of making available large R&D resources for varied sets of fuel alternatives.


Prior Congresses missed major opportunities to break America’s oil addiction, failing to invest boldly in alternative energy. Lawmakers never took seriously the idea of taxing carbon or BTUs instead of income. And Congresses passed on chances to help states and municipalities build high speed rail when real estate was comparatively cheap. We’re so behind technologically in the race to curb our oil habit, the President and Congress are resigned to prescribing short-term solutions that risk enhancing rather than reducing our gasoline craving.


Postponing thoughtful action on energy policy until the next election is a familiar but tired refrain.


Nevertheless, November 2008 represents a rare opportunity for real change. Sen. Barack Obama, Clinton and Sen. John McCain offer comparatively forward-looking, less oil-soaked energy plans than does President Bush.


McCain is no ordinary Republican on energy and environmental issues. So, as Americans stare-down crooked numbers like $4 at the pump, Democrats who invoke “divided leadership in Washington” do so at their own peril — even in the event of a McCain presidency.


Of course, the fall election outcome won’t undo pain at the pump endured in the preceding summer driving season. In fact, high summer, nay, high year-round gas prices will likely be with us for years to come thanks to keen domestic and Asian demand, the cresting of global oil production, and too-little-too-late solutions from America’s elected leaders — presidents and lawmakers alike.


For the foreseeable future, that’ll be one expensive tiger in your tank.



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