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FD
06-16-2011, 03:58 PM
Senate Backs Repeal of Ethanol Tax Credit


By COREY BOLES

WASHINGTON—The Senate voted Thursday to repeal a $6 billion tax credit for ethanol producers, a move that could signal the end of some federal subsidies as part of an eventual budget and debt-ceiling compromise.

A bipartisan group of senators—40 Democrats and 33 Republicans—joined together in a 73-27 vote to support an end to the subsidy. The subsidy gives refiners a 45-cent-a-gallon tax credit for blending ethanol into gasoline and has been a factor behind higher corn prices in recent years. Sen. Chuck Grassley (R., Iowa), a longtime supporter of the credit, objected to the measure.

The U.S. ethanol industry is protected by a tariff of 54 cents a gallon on imported ethanol and that, too, would end under the Senate measure.

The ethanol provision was added to unrelated legislation that would renew a program directing federal funding to deprived parts of the country to help local governments attract private investment. Even if approved by the Senate, the legislation isn't expected to be taken up by the House, possibly limiting the vote to symbolic significance.

The vote could prove important in the ongoing budget negotiations. By voting in favor of ending the subsidy, it opens Republicans up to the charge that they are supporting tax increases—ending the subsidy would result in higher taxes on ethanol producers. Republicans have rejected higher taxes as a component in any deal on the budget deficit and accumulated debt.

Democrats, led by Sen. Charles Schumer (D., N.Y.), argued this week that it would be impossible for Republicans to maintain that position after the vote this week. But Sen. Tom Coburn (R., Okla.) said he believed an end or reduction to the subsidy would form part of the final budget deal.

"It should send a good signal—if you had $6 billion that you had as an earmark in an appropriations bill that was going to the [ethanol] blenders and we took it away, nobody would've ever said anything about taxes," Mr. Coburn said.

An earlier vote on ending the ethanol subsidy failed on Tuesday, but that was largely because of Democratic anger at the manner in which the measure was brought to the floor.

The amendment was sponsored by Sen. Dianne Feinstein (D., Calif.) who has long pushed for an end to the tax credit.

Senators are now voting on a separate measure that would prevent federal funds from being used for ethanol storage facilities or blender pumps, another attempt at limiting federal support for production of the fuel alternative. That measure is backed by Sen. John McCain (R., Ariz.).


http://online.wsj.com/article/SB10001424052702304319804576389843694911096.html?mod=WSJ_hp_LEFTTopStories

jiveturkey
06-16-2011, 03:58 PM
This is a good move.

FD
06-16-2011, 04:00 PM
It is a good move. Hopefully the House will pass it, too, although they are not expected to.

Dayze
06-16-2011, 04:02 PM
so, what does this mean? serious question....I'm not well versed in this.

HonestChieffan
06-16-2011, 04:08 PM
Will be interesting to watch how it all rolls out.

States have required gas stations to sell ethanol. With the subsidy gone, ethanol containing gas is likely to go up in price...increasing cost to consumers. Will states who force the use of ethanol change those laws?

The ethanol plants scattered all over will likely be the biggest loser if they have to raise price and the states drop the ethanol requirement these will be a new rural dinosaur

The House would have to vote for this to become real. Will the House do so? I have my doubts. Governors will be pushing for a no vote I would expect.

But, with congress and all thats going on with us being broke, anything is possible.

Bewbies
06-16-2011, 04:11 PM
Good, food should be eaten, not burned.

BucEyedPea
06-16-2011, 04:52 PM
Good!

mnchiefsguy
06-16-2011, 05:45 PM
Hopefully this will help drop the price of corn, and help food prices.

Not sure how other states work with their ethanol laws, but if I remember right, Missouri only requires stations to sell ethanol gas when said gas is cheaper. When normal gas drops to an equal or lower price, or if ethanol gas raises in price, then I believe stations are required to go with the cheapest option. I could be mistaken though.

ChiTown
06-16-2011, 05:57 PM
Bought fucking time. Quite frankly, the Ethanol Industry believes they can stand on their own two feet. We shall see..............

Chocolate Hog
06-16-2011, 06:03 PM
Awesome.

Mr. Laz
06-16-2011, 06:14 PM
about dam time


maybe this will end the stupid "Ethanol Pledge" every election too.

Simplex3
06-16-2011, 06:15 PM
So help me if a Republican controlled House doesn't pass this...

Bwana
06-16-2011, 06:21 PM
Good, food should be eaten, not burned.

Exactly and your car won't run like an under powered tub of crap.

chiefqueen
06-16-2011, 06:44 PM
so, what does this mean? serious question....I'm not well versed in this.

Hopefully, this means that what little corn that survives to be harvested this summer will be eaten, not made into fuel.

Ace Gunner
06-16-2011, 06:55 PM
Good, food should be eaten, not burned.

ya, except this particular food is way hyper eaten - corn syrup is in damn near everything & it is among the least healthy foods on earth. hell, corn is evil shit really

FD
06-16-2011, 07:00 PM
So help me if a Republican controlled House doesn't pass this...

Prepare to be disappointed.

HonestChieffan
06-16-2011, 07:45 PM
It wont be an R vs D issue.

Ethanol, regardless of its economics, is a issue of dependency on foreign oil. That will cross party lines automatically.

It also impacts fuel price at the pump. Another cross party line issue. People want cheap fuel. They never consider the fuel is subsidized by the government. Plus look how many people pay zero in federal income tax. Those people will see subsidized ethanol as something the rich folk pay for that benefits them.

The corn used to make ethanol is not used for human consumption so it really has no food value to people.

Once it is used to make ethanol, the corn is fed to cattle and hogs. It is not a zero sum game.

The impact politically is that corn price may drop, not much. And for R or D congressmen in corn states that is a negative. Gas price may actually rise, not good for any incumbent. And if we continue to use ethanol due to its renewable nature, it may come from Brazil where its made from sugar. US employees lose a job in that mix.

Dont lay this one on R or D...its got sharp points for anyone close to it.

Bewbies
06-16-2011, 08:47 PM
ya, except this particular food is way hyper eaten - corn syrup is in damn near everything & it is among the least healthy foods on earth. hell, corn is evil shit really

I'm sure a mother who is forced to feed her kid mud somewhere like Haiti or another 3rd world country would much rather feed her kid corn. If we're going to subsidize farmers and corn, why not feed the starving instead of burning it in our gas tanks?

(feeding the hungry is the job of private charity, gov't money going to those places is why the Kings/Presidents live in multiple palaces and have 100 Benz's yet their people starve--my point is rhetorical)

BucEyedPea
06-16-2011, 08:55 PM
I'm sure a mother who is forced to feed her kid mud somewhere like Haiti or another 3rd world country would much rather feed her kid corn. If we're going to subsidize farmers and corn, why not feed the starving instead of burning it in our gas tanks?

(feeding the hungry is the job of private charity, gov't money going to those places is why the Kings/Presidents live in multiple palaces and have 100 Benz's yet their people starve--my point is rhetorical)

Yeah, and it's driving up food costs while it uses up land that can be used for crops.

Bewbies
06-16-2011, 08:57 PM
Yeah, and it's driving up food costs while it uses up land that can be used for crops.

If you could make it out of grass and it could support itself I'd love that, but using food is one of the dumbest decisions we've ever made. Too many hungry people out there to do that.

2bikemike
06-16-2011, 09:17 PM
Good, food should be eaten, not burned.

I don't know them Burnt Ends are pretty damn tasty!

Saul Good
06-17-2011, 08:44 AM
I like how the author accuses Republicans of raising taxes by ending a government subsidy that is fueled by tax dollars. This is the exact opposite of what this dumbfuck suggests.

Bob Dole
06-17-2011, 09:06 AM
ya, except this particular food is way hyper eaten - corn syrup is in damn near everything & it is among the least healthy foods on earth. hell, corn is evil shit really

It's just a fucking sugar, biochemically almost indistinguishable from cane sugar. Ingesting too much of either one is unhealthy. Seriously...stop believing the junk science.

FishingRod
06-17-2011, 09:14 AM
It was always one of those it sounds good on paper ideas that in practice had the opposite affect that it was supposed to. These subsidies and the laws requiring the use of Ethanol should never have been passed in the first place and their negative impact has been blatantly obvious for so long that only our Government could take this long to figure it out.

Ace Gunner
06-17-2011, 09:54 AM
I'm sure a mother who is forced to feed her kid mud somewhere like Haiti or another 3rd world country would much rather feed her kid corn. If we're going to subsidize farmers and corn, why not feed the starving instead of burning it in our gas tanks?

(feeding the hungry is the job of private charity, gov't money going to those places is why the Kings/Presidents live in multiple palaces and have 100 Benz's yet their people starve--my point is rhetorical)


oh, no - let them eat mud...


srsly..

Ace Gunner
06-17-2011, 09:57 AM
It's just a ****ing sugar, biochemically almost indistinguishable from cane sugar. Ingesting too much of either one is unhealthy. Seriously...stop believing the junk science.

contradicting yourself can make you look kinda nuts, but thx 4 agreeing with me in that part of your post

dirk digler
06-17-2011, 10:05 AM
I like how the author accuses Republicans of raising taxes by ending a government subsidy that is fueled by tax dollars. This is the exact opposite of what this dumbfuck suggests.

That is exactly what Grover Norquist believes. He is the head of the conservative group Americans for Tax Reform and has come out strong against cutting this subsidy.

jiveturkey
06-17-2011, 10:21 AM
It's just a ****ing sugar, biochemically almost indistinguishable from cane sugar. Ingesting too much of either one is unhealthy. Seriously...stop believing the junk science.
I think that the problem is the fact that they're putting it in everything. Food that doesn't or shouldn't have sugar as an ingredient contains corn syrup.

FD
06-17-2011, 10:35 AM
That is exactly what Grover Norquist believes. He is the head of the conservative group Americans for Tax Reform and has come out strong against cutting this subsidy.

Right, his and other right-wing anti-tax groups view cutting this taxpayer subsidy as a "tax increase" because the subsidy takes the form of a tax credit. This is why this measure will likely fail in the GOP controlled House, unfortunately.

Chief Henry
06-17-2011, 10:38 AM
Cut all the farm subsidies...we can't afford it. The amount of free CHEE$e farmers and non farmers receive is astounding.

FD
06-17-2011, 10:40 AM
And the food market reacts...

But the prospect of an even modest reduction in demand has helped drive Chicago corn prices more than 12 percent lower this week, pulling them down from a record near $8 a bushel a week ago.

Traders are betting on reduced demand from ethanol makers whose profit margins are being squeezed by near-record corn costs and falling gasoline prices, in addition to the longer-term risk of reduced government support.

http://www.reuters.com/article/2011/06/16/us-usa-senate-ethanol-idUSTRE75F5IN20110616

Hydrae
06-17-2011, 01:05 PM
So we save money be cutting this subsidy while at the same time lose revenue by cutting the tariff on imported ethanol. I wonder what the bottom line of this is and if it actually comes out as a large enough positive to offset jobs lost.

jidar
06-17-2011, 02:15 PM
I like how the author accuses Republicans of raising taxes by ending a government subsidy that is fueled by tax dollars. This is the exact opposite of what this dumb**** suggests.

The subsidy was a reduction in taxes in the first place (a tax credit), not a pay out, by ending the subsidy the net effect is an increase in taxes paid by that corporation.

For the most part there isn't much of a difference between a payout and a tax break though, not for a business nor for the governments budget.

Although when the Bush Tax cuts were about to expire I made this same point and got taken to task for it, except in that case people were going the other way with it and claimed that "Tax cuts aren't spending!".

DJ's left nut
06-17-2011, 03:09 PM
so, what does this mean? serious question....I'm not well versed in this.

It means you'll see fewer corn farmers with new pickups and that your average MPG should go up a bit, especially if states roll back their dumbass ethanol mandates as well.

It's a very very good thing for everyone but corn farmers. It will even bring down the price of a few other crops as well (as those guys that planted nothing but corn to take advantage of these things will start planting other crops instead.)

DJ's left nut
06-17-2011, 03:10 PM
Hopefully this will help drop the price of corn, and help food prices.

Not sure how other states work with their ethanol laws, but if I remember right, Missouri only requires stations to sell ethanol gas when said gas is cheaper. When normal gas drops to an equal or lower price, or if ethanol gas raises in price, then I believe stations are required to go with the cheapest option. I could be mistaken though.

In theory.

But the energy yield of ethanol is lower than straight gas. So when you talk about 'cheaper', you're talking mostly about what it costs the stations. All told, break even is actually a net loss for the consumer as they lose fuel economy in the bargain.