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EPA Ethanol Cut Perturbs Politicians

Monday November 25th, 2013   •   Posted by K. Lloyd Billingsley at 8:06am PST   •  

ethanol_200Six years ago Congress imposed a mandate on how much ethanol and other biofuels must be mixed into gasoline. Now the Environmental Protection Agency (EPA) is proposing the first-ever cut in that amount. That has politicians perturbed, but for the wrong reasons.

The mandate was for 15 percent ethanol — standard stocks contain 10 percent or less — but consumers were rejecting that blend because of potential damage to their engines, on which they rely heavily. EPA officials and petroleum industry spokesmen acknowledged the dangers of the “blend wall” for consumers. For politicians the problem was something else.

Senator Charles Grassley of Iowa denounced “misguided” rules that would kill jobs, dirty the air and protect “the stranglehold Big Oil has on the country’s fuel supply.” He said this was a step back from “lessening our reliance on foreign sources of oil.” But with U.S. oil production booming, that dependence is largely a thing of the past. The United States is on track to become the world’s biggest oil producer by 2015. Shale production, fracking, and lower overall demand for fuel — abetted by electric cars and hybrids — have teamed to make ethanol less attractive to producers and consumers alike.

This is a classic example of federal policy failing to keep pace with reality and politicians defending it for political reasons. For the EPA to recognize that federal regulations can actually harm consumers represents something of a departure for the agency, which employs 17,000 and deploys a budget of $8 billion.

As we noted, EPA boss Al Armendariz, an Obama appointee, compared EPA enforcement style to the Roman army crucifying locals to set an example. And EPA “management analyst” Susie Goldring thought that Argentine Stalinist Ernesto “Che” Guevara was a fine example to get the EPA caught up on Hispanic culture.

We also noted the case of John Beale, an EPA manager who claimed to work for the CIA, failed to show up for years, and defrauded taxpayers of $1 million. The EPA even paid this fraudster “retention bonuses,” after he retired. In hearings on the case, it emerged that the EPA shows “an absence of even basic internal controls.” So plenty of room for reform, but maybe the EPA is finally giving it a shot.

In calling for the first-ever cut in the ethanol blend, the EPA shows itself more sensible than Congress. On the other hand, that is not terribly difficult to pull off.

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November 2013