Congress Makes 2 Good Moves on Ethanol

December 28, 2011   |   Tags: , , , , ,

The 30 year subsidy for corn ethanol is over, as Congress has not extended it. Adding to this, imported ethanol from Brazil will no longer face a tariff.

Economically, this means that the US ethanol industry will have to compete fair and square to earn it’s profits. Also, this could slightly reduce the price of gasoline, as a level playing field will allow ethanol-rich Brazil to better compete in the US ethanol market. Up to 10 percent of the fuel that you regularly use is actually ethanol, in case you were wondering.

It’s great to see Congress end a $6 billion annual handout to a favored industry and increase competition in the marketplace. Most Americans will benefit from both actions. Consider it a small victory for taxpayers and capitalism.

More on this story can be found here.

Photo credit: eere-pmc.energy.gov/PMC_News/images/ethanolmythpic.jpg

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