Agricultural News
Ethanol Subsidy Battle Comes Down to Floor Vote on Tuesday Afternoon
Tue, 14 Jun 2011 5:54:28 CDT
Senator Tom Coburn of Oklahoma received a letter of support from Koch Industries on Monday afternoon in advance of the floor action on his proposal that comes up Tuesday afternoon that could begin the process of ending the VEETC tax credit as well as the import tariff that benefits domestic ethanol. Koch is an ethanol blender and currently receives the tax credit.
Click here for our earlier story that included the statement from Senator Coburn about the move to attach this amendment to an Economic Development bill moving through the Senate this week.
In addition, we have an audio update on the debate that is unfolding in rapid fire time about ethanol this week- Stewart Doan summarizes the challenge to ethanol subsidies mounted by Dr. Coburn. Click on the LISTEN BAR at the bottom of this story.
The vote on Coburn's amendment will occur at 1:15 PM central time this afternoon and may be followed by two additional anti-ethanol amendments - one by Senator Jim DeMint of South Carolina that would repeal the RFS and another by Sen. John McCain of Arizona that would block funding for blender pumps and other demand infrastructure for ethanol.
Here is the text of the letter sent to Coburn from Koch Industries.
June 13, 2011
Senator Tom Coburn
172 Russell Senate Office Building
Washington, DC 20510
Dear Senator Coburn,
Koch Industries has opposed federal mandates and subsidies for decades. Our aim is to create a free market where consumers decide winners and losers based on which products they decide to buy, instead of government picking winners and losers based on which friends or products it chooses to subsidize.
One such government intervention is the tax credit that provides about $6 billion each year to blenders of ethanol. Lawmakers in the Senate could take a sensible step by approving an amendment sponsored by Senator Tom Coburn (R-OK.) that would eliminate this credit. We hold this position despite the fact that we benefit from these tax credits.
We oppose ethanol subsidies because they distort economic signals about price and demand and create inefficiencies that divert resources from productive activities to politically favored ones. We have also opposed subsidies for natural gas vehicles and other biofuels for these same reasons.
Still, our company now produces and blends ethanol, because while we would prefer that there be no government mandates or subsidies, once such laws are in place we will comply with them. We will not place our company or our employees at a competitive disadvantage in the mixed-market economy in which we compete.
Our government and public affairs activities are based on principles of economic freedom and property rights that are core values recognized and held by the majority of Americans. Koch will continue to lobby for the repeal of energy subsidies and mandates. We will work to transform the current, mixed-market economy into a true free-market economy.
Sincerely,
Philip Ellender
President and COO Public Affairs
Koch Companies Public Sector, LLC
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