Subsidizing moonshine.(Correction, Please!)(Viewpoint essay)

ITEM: The Associated Press reported on December 6 that "House Democratic leaders are optimistic that they can pass an energy bill that would repeal billions of dollars in oil industry tax breaks and for the first time in decades require a major increase in automobile fuel economy."

In a letter to the president's top economic adviser, House Speaker Nancy Pelosi (D-Calif.) "defended 'closing tax loopholes given to large oil and gas companies at a time that they are reporting record profits.' She said the money is needed to pay for tax incentives to spur renewable energy including credits for building cellulosic ethanol plants" and other incentives.

The legislation, the AP noted well down in its account, "also calls for a huge increase in ethanol use as a motor fuel, requiring 36 billion gallons be used by 2022, a sevenfold jump from existing requirements."

CORRECTION: Trading one package of federal subsidies for a larger set is hardly a recipe for energy independence. After all, if ethanol were as wondrous as its proponents claim, it wouldn't need to be lavishly underwritten by the government. The truth is that the latest energy legislation and the continued push for ethanol by the government-backed moonshiners have much less to do with reality and much more to do with politics. The ethanol craze brushes aside some mighty pertinent facts: it mandates the use of a fuel that currently costs more than gasoline, drives up food prices, negatively impacts the environment, and does little or nothing to reduce U.S. dependence on foreign oil.

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In 2005, the ethanol program in the United States used about 15 percent of the corn crop in the country, yet it displaced less than 2 percent of the gasoline use, according to the executive director of the AEI-Brookings Joint Center in Washington. "Even if all corn produced in the U.S. were devoted to distilling ethanol," says Robert Hahn, "the renewable fuel would amount to about 12 percent of the gasoline demand in 2005."

Of course, ethanol is not really a "renewable" fuel since its production depends so heavily on fossil fuels. Professor David Pimental of Cornell has noted that it requires "30 percent more energy oil equivalents to produce a gallon of ethanol than you actually get out, and it causes a lot of severe environmental problems. It takes 1,700 gallons of water to produce 1 gallon of ethanol. Corn causes more soil erosion than any other crop grown in the nation. It uses more insecticides, herbicides and N [nitrogen] fertilizer than any other crop grown in the nation."