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Thursday, April 23, 2015

Fox News came calling. Go here and sign up fpr my FREE caucuses online class.

Chicago based Fox News correspondent Mike Tobin and his crew of 6 came to Ames and Nevada.

(Picture by Meriesa Elliott: Tobin left and Schmidt, 2015)

The story?

"Do candidates for president have to knuckle under to the ethanol industry in Iowa if they want to win the caucuses?"

The answer is NO!

"Well how do conservative small government Republican justify the federal Renewable Fuel Mandate (RFM) that requires gasoline to be blended with ethanol.?"

The answer is that the United States asked us to ramp up an ethanol industry in order to help the US

a. Become more energy self sufficient
b. Replace the very toxic which was the previous additive blended in gasoline because ethanol was deemed to be much more environmentally friendly
c. Encourage a "renewable" fuel (ethanol) which had been successfully used for decades in Brazil.
Investors, many of them farmers, put their money into new companies which built and ran ethanol plants. farmers planted sufficient corn to supply these plants with the input to make ethanol. 
A tax incentive and a mandate to blend fuel with ethanol made all of this feasible.

The tax incentive went away. Blending gasoline with ethanol continued to drive supply that made the economics of ethanol work.

Then it became a political issue.

Tea Party and small government Republicans began to question the mandate; forcing consumers to buy a product.  Shades of ObamaCare which forces Americans to buy healthcare insurance. Environmentalists said ethanol production uses up too much water, stresses farms with too much production of corn, diverts corns from feed and human consumption, and the claim that ethanol is bad for engines was added to the attack on this industry.

Now the question is whether presidential candidates must obey the rule of supporting the RFS.

I think not.

Republicans can realistically argue that phasing out the RFS and allowing market forces to sustain the industry rather than suddenly yanking the plug is the responsible thing to do. Freshman Iowa GOP Senator Joni Ernst successfully used that line of reasoning in her campaign.

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