Posted on: November 30, 2010 in

Letter to the Editor, Chicago Tribune, Re: Dennis Byrne’s column “Time to stand up to ethanol interests.”

To the Editor:

In his column “Time to stand up to ethanol interests,” (Chicago Tribune, November 30, 2010) Dennis Byrne contends that, because “both sides” point to “snow storms of studies,” the issue is “unsettled,” public policies are “a crapshoot,” and, therefore (if you agree that any question with two sides should be resolved in the negative), Congress should stop encouraging the production and use of American-made biofuels.

In other words, don’t bother to evaluate the arguments for and against American ethanol. Off with its head! On the old-fashioned assumption that public policy should be based on facts, not feelings, here’s the case for continuing to support the only alternative to imported oil:

First, Byrne’s facts and figures are accurate for the tax credits for domestic ethanol and the renewable fuels standards for 2009, 2011 and 2022. But he neglects to mention the economic, environmental and energy security advantages that these policies produce.

On the economic front, in the midst of a deep recession last year, American ethanol helped nearly 400,000 Americans keep their jobs or find new ones. U.S. ethanol producers contributed $53.3 billion to the Gross Product, generating $15.9 billion in federal, state and local tax revenues. In Illinois, 14 ethanol plants support tens of thousands of jobs – a major boost for the state economy.

What if Congress followed Byrne’s advice and eliminated the ethanol tax credit? According to a recent study by the economist John M. Urbanchuk, this would reduce production of the biofuel by as much as 37.7 percent and wipe out more than 112,000 jobs. More than 13,000 of these job losses would be in Illinois, according to Senator Richard Durbin’s office.

Yes, as Byrne notes, ethanol’s opponents do contend that it damages cars, raises food prices, increases air pollution, and alters global land-use patterns. But none of this is true, which is one reason why the U.S. Environmental Protection Agency recently approved increased ethanol blends for gasoline used in newer cars. In fact, food prices and ethanol production neither rise nor fall together, and American farmers produce record yields of corn on about the same acreage as two generations ago.  As for air pollution, using ethanol results in 20 to 60 percent fewer greenhouse gas emissions than gasoline unblended with biofuels.

If anyone has a valid complaint against American ethanol, it’s Hugo Chavez and Mahmoud Ahmadinejad. Producing and using10.6 billion gallons of ethanol replaced 364 million barrels of imported oil last year.

As President Reagan used to say, “Facts are stubborn things.” Decisions about American biofuels should be resolved by debating, not dismissing, the facts.

Bob Dinneen, President and CEO
Renewable Fuels Association
Washington, DC

Letter to the Editor, San Francisco Chronicle, Re: Debra Saunders editorial “Al Gore’s billion-dollar mistake.”

To the editor:

Chronicle columnist Debra Saunders claims to be a free market advocate which would mean opposing all types of corporate welfare... if only that were the case (“Al Gore’s billion-dollar mistake,” 11.30.10).  While Ms. Saunders chooses to denounce ethanol as wasteful, she fails to mention the billions of dollars still spent to subsidize the most profitable businesses in the world – oil companies.

As the International Energy Agency recently noted, the world spent more than $300 billion in fossil fuel subsidies in 2009.  In 2008, that number was more than $500 billion.  Yet, in 2009, the US invested just $5 billion in a domestic renewable fuels industry that creates jobs and economic prosperity that cannot be outsourced.   Better yet it cuts oil imports from the Middle East. 

To Ms. Saunders claim that ethanol is adding to the debt, such an argument is simply untrue.  Based upon economic analysis, the ethanol industry contributed $8 billion in federal tax revenue in 2009, $3 billion more than was invested in the form of the tax incentive.  Moreover, it helped the nation reduce its foreign oil tab by more than $16 billion and added some $21 billion directly the bottom lines of nearly 400,000 households across the country.

In a perfect world, all subsidies for energy would not exist.  In such an environment, ethanol would compete very effectively with oil.  However, since oil receives exponentially more support than biofuels the world over, why should we abandon the only currently viable alternative to petroleum in favor of more subsidized oil? 

Free markets are great, but like unicorns, they are fantasy. 

Bob Dinneen, President and CEO
Renewable Fuels Association
Washington, DC

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