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Then and now

Ethanol blunder should make us wary of new EPA ruling

Issue: "On the road again," May 9, 2009

If you think the Environmental Protection Agency knew what it was doing with its sweeping mid-April announcement about greenhouse gases, it might be good to go back and get yourself a refresher course on the EPA and ethanol.

It wasn't that long ago, you see, that the EPA was also very sure that ethanol was exactly what the world needed. It was on July 1, 1994, that The Washington Post reported, a little triumphantly: "The Clinton administration yesterday announced that nearly one-third of gasoline sold in the most polluted U.S. cities must contain additives, such as grain alcohol, that are derived from corn or other renewable sources.

"The policy, announced by Environmental Protection Agency Administrator Carol M. Browner, becomes effective in January 1995. Amendments to the Clean Air Act require that, by that date, gasoline sold in the nation's nine smoggiest cities must contain at least 2 percent oxygen by weight to promote cleaner burning.

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"For years, regulators have debated what sorts of such oxygen-bearing additives ('oxygenates') should be used, and what percentage of them should be from . . . "

That years-long debate, of course, has never even approached resolution. It has instead intensified-along with an increasingly sharp argument over the legitimacy of ethanol as a fuel additive or substitute.

But during the debate, one fact did become clear. The EPA, in its unstinting backing of ethanol, had bet on the wrong horse. That proved to be the case partly because the very production of ethanol turned out to be much more costly and more damaging to the environment than folks thought a decade or so ago. And it has been the case because the cost of petroleum products has, for the most part, unexpectedly stayed low enough to make ethanol practical only if it is heavily subsidized by the government.

Along the way, the destruction inflicted by the EPA's know-it-all mandates has been enormous. With Uncle Sam insisting on millions of gallons of additives and substitutes, huge proportions of the nation's corn crops were diverted from food for humans and animals and directed into ethanol production. Food prices shot up around the world. Corn farmers loved it. Beef farmers, who had to pay twice as much to feed their cattle, hated it. Whole regional economies were drastically skewed. In Dyersville, Iowa, a few miles from where I grew up, one of the nation's biggest ethanol facilities ever constructed opened last fall-and then closed its doors a few weeks ago.

So who's the loser? Just about everybody. Hundreds of corporations are bankrupt. Farmers are bewildered and economically disheveled. Thousands of individuals and families are without jobs that seemed to have so much promise. And taxpayers are on the hook for huge chunks of it. If this is what a "planned economy" looks like, maybe the rough and tumble of free enterprise isn't so bad after all.

So isn't it a little cheeky now for that same EPA to come along with a cocksure finding that carbon dioxide and five other greenhouse gases "endanger public health and welfare" under federal clean air laws, that they help cause climate change, and that they pose an enormous threat "in both magnitude and profitability"?

And isn't it a wee bit disconcerting, and even off-putting, that it's the very same Carol M. Browner who has graduated from heading the EPA and now serves as Assistant to the President for Energy and Climate Change?

We're not to worry, we're told as part of this announcement, that the EPA and other agencies are about to strangle us suddenly with new regulations. The plan instead is for Congress to take the hint that this grand "finding" will serve as a legitimate excuse for enacting all such rulings as legislation rather than mere regulations. It's "a wake-up call for Congress," says Sen. Barbara Boxer, D-Calif. Deal with it directly through legislation-or let the EPA regulate. If Congress doesn't move, Boxer said she would press the EPA to take swift action.

The EPA misstep in the 1990s was, comparatively, just that-a small misstep. And its gigantic consequences will be felt, and paid for, for years to come.

But the EPA's momentous declaration a couple of weeks ago will reach into every nook and cranny of our weak and fragile economy. It will touch-and tax with gusto-the energy needed to light, heat, and power every home, business, and vehicle in America. Where's the evidence that the EPA's gotten any smarter than it was a decade ago?

If you have a question or comment for Joel Belz, send it to jbelz@worldmag.com.

Joel Belz
Joel Belz

Joel, WORLD's founder, writes a regular column for the magazine and contributes commentaries for The World and Everything in It. He is also the author of Consider These Things.

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