Corporate welfare, corruption and Big Oil

Source: By Tom Buis, The Hill • Posted: Thursday, July 23, 2015

A recent opinion piece, “‘Maize’ of Corruption,” published on July 10, is the latest evidence that the oil industry and its shills must resort to bold and outright dishonesty to attack competition from American-made renewable fuels. While the author attempted to equate a successful bipartisan energy policy, the Renewable Fuel Standard (RFS), with Washington corruption, the piece both cited figures that were off by literally hundreds of billions of dollars, and chose to inexplicably ignore the oil lobby’s overwhelming cash advantage over all of its competitors.

The idea that ethanol, a homegrown, clean-burning alternative to fossil fuels found to significantly reduce cancer-causing pollution and greenhouse gas emissions, is more harmful to our environment than foreign and fracked oil is a laughable regurgitation of talking points used by the oil industry–ironically, the biggest special interest there is. Argonne National Laboratory working with the Department of Energy and EPA has shown that ethanol reduces greenhouse gas emissions by 34 percent compared to gasoline.

Moreover, oil spills can have ramifications for years, even decades – just look at the countless oil spills, such as in the Gulf of Mexico and the recent spill in Santa Barbara that closed beaches and damaged local ecosystems up and down the California coast. How many beaches can you remember being closed due to ethanol spills?

Another significantly flawed point is that ethanol production uses 40 percent of the U.S. corn supply. Nothing could be further from the truth. The production of ethanol only uses 17.5 percent of the net acres of the U.S. corn crop, and only the starch from the kernel is removed. All of the protein, fiber and oil are returned to the feed chain in the form of a highly nutritious animal feed.

Furthermore, trying to blame the ethanol industry for high food prices is simply not supported by the facts. A 2013 World Bank study showed that crude oil prices are responsible for more than 50 percent of the increase in global food prices since 2004. According to the World Bank, the number one cause of food inflation is rising crude oil prices, because it raises the cost of producing, processing, storing, refrigerating and transporting the world’s food. It takes a lot of energy to get food from the farm to the table and those costs are nearly all attributed to the cost of oil. Ethanol, on the other hand is produced from field corn, only a small quantity of which is used for human consumption, and advanced technologies are allowing it to be produced from agricultural waste.

But the most outrageous claim the author makes is that the corn ethanol industry has spent $10.8 BILLION dollars in contributions to federal campaigns from 2008 to 2014 and another $187.5 BILLION dollars lobbying from 2007 to 2014. Billions, really? Perhaps Ms. Lowman should do some fact checking before she tosses out such wildly inaccurate and sensational claims. In reality, the ethanol industry only spent a fraction of a percent of that amount. Compare that to the $210 million in campaign spending and the $1.1 billion the oil and gas industry has spent in lobbying during the same time period. And while we’re at it, let’s consider the massive tax breaks–totaling over $4.8 billion annually–for the oil and gas industry, compared to absolutely no tax breaks for the ethanol industry, and you have a much clearer picture.

Who is really spending the big bucks and also getting more back in the form of government largesse? The answer is as clear as it always has been.

Buis is CEO of Growth Energy.