Perry Attacked in Iowa for Opposing Ethanol Subsidies, Mandates

Published January 3, 2012

The ethanol industry is targeting Texas governor and Republican presidential candidate Rick Perry in the run-up to the Iowa caucuses for arguing government should not subsidize ethanol production or mandate a market share for ethanol. Despite the attacks, Perry is holding firm in arguing government should not be picking winners and losers in the energy marketplace.

Gingrich, Romney Support Subsidies
Iowa frontrunners Newt Gingrich and Mitt Romney have played by the tried-and-true Iowa playbook, championing ethanol subsidies and mandates. As a result, Perry has been taking the full brunt of the state’s most powerful political lobby.

Won’t Change Position
Perry’s record against ethanol subsidies was well established before he entered the Republican presidential primaries. In 2008 Perry flew to Washington DC to press his case for an end to ethanol production and mandates. Nevertheless, the ethanol industry was hopeful Perry would change his tune this year, given the importance of the Iowa caucuses.

“When Gov. Perry entered the presidential race, Iowa’s renewable fuels community said it would keep an open mind and not hold past actions by the governor in his state role against him,” Iowa Renewable Fuels Association president Walt Wendland told the Des Moines Register.

“While Iowans are renowned for our patience and open-mindedness, both are being put to the test by Texas Gov. Rick Perry’s recent campaign actions,” Wendland warned.

Perry’s recent campaign actions reaffirm his intent to eliminate energy subsidies and mandates of all kinds. “[W]hether you’re in the oil and gas business, the tax credits they get, whether you’re in the ethanol business and the renewable fuel standard or whether you’re in the wind side, from Washington DC, I do not think it is the federal government’s business to be picking winners and losers in frankly any of our energy sources,” Perry said in a November public forum in Pella, Iowa.

Crony Capitalism
Todd Wynn, the Energy, Environment, and Agriculture Task Force Director at the American Legislative Exchange Council, agrees government should not decide who will succeed in the energy marketplace.

“It is not the proper role of government to pick winners and losers in the energy market, whether that be oil, coal, natural gas, or the currently politically preferred technologies such as ethanol, wind, and solar,” Wynn said.

Jay Lehr, science director for The Heartland Institute, which publishes Environment & Climate News, said the nation would be better off if all energy subsidies were completely eliminated.

“Our innovative industries across the board can make it on their own without subsidies or mandates. If they could not do so, they would not deserve to survive. Our economic strength is encouraged and preserved when taxpayers are not required to subsidize particular industries or buy particular products they do not want or need,” said Lehr.

“The ethanol industry is the example of government intervention overkill. We subsidize the production, we mandate its use, and we punish potentially less expensive ethanol from other countries. Ethanol is the poster child of how government should not do energy policy,” Wynn observed.

Alyssa Carducci ([email protected]) writes from Tampa, Florida.