Update: "Ethanol: "Senate keeps $6B in subsidies, but 34 GOP side with Coburn" (ADM; PEIX)"
Mr. Norquist (he of the no new taxes pledge) has somehow convinced himself that a cut in ethanol subsidies is a tax hike.
I have a fairly facile mind but can't wrap the gray matter around that one.
Today's vote is full of sound and fury, signifying nothing though.
First off even if it passes the Senate, it looks a longshot in the House and on the President's desk.
More importantly, with 40% of the corn crop going to ethanol, repeal of the the Renewable Fuel Standard, which this year mandates 12.6 billion gallons of corn liquor, would do more to help the citizen/taxpayer than cutting the subsidies.
[you forgot the first part of the Macbeth quote: "...it is a tale Told by an idiot, full of sound and fury, Signifying nothing" -ed]
First up, Bloomberg:
Chicken Breeders Face Senate Tax-Cut Hawks
A vote in the U.S. Senate today will pit corn growers against chicken farmers, anti-tax purists against anti-spending advocates, and Democrats and Republicans against members of their own parties.From NewsMax:
Senator Tom Coburn’s attempt to eliminate tax breaks and tariffs that benefit the ethanol industry will place his colleagues in the middle of the political fight over corn-based energy that has fermented for years. Coburn is bringing another quarrel to a boil -- his feud with Grover Norquist, president of Americans for Tax Reform, a Washington group that has persuaded 40 of 47 Republican senators to sign its no-tax-increase pledge.
The legislation on the Senate floor, an economic development bill, is unlikely to become law. Instead, lobbyists and members of Congress are watching the fate of Coburn’s amendment as a signal for whether the Oklahoma Republican can persuade members of his own party to declare that eliminating a tax break isn’t always equivalent to a tax increase.
If Coburn succeeds, it would be easier to attack other tax breaks in a similar way or pare such breaks to reduce the federal budget deficit....MORE
Grover Norquist Battles Sen. Coburn on Ethanol Subsidy
What constitutes a tax increase is at the heart of a battle between Sen. Tom Coburn, a Republican from Oklahoma, and Grover Norquist, president of Americans for Tax Reform.
Coburn has introduced a measure to eliminate tax credits or deductions that subsidize production of ethanol from corn by nearly $6 billion a year. As much as 40 percent of the nation’s corn crop is diverted to make an alternative fuel which is blended with gasoline. The tax credit goes to fuel blenders, including major oil companies.
Getting rid of the subsidy, long a sacred cow, is a “good thing,” Norquist says. But Norquist reasons that if you decrease revenue to the government by getting rid of tax credits or deductions, it will constitute a hidden tax increase to all taxpayers because the government will spend the money and obtain the lost revenue by increasing taxes overall.
Working with Sen. Jim DeMint, the South Carolina Republican, Norquist has come up with a solution. It’s an amendment DeMint plans to introduce to legislation reauthorizing the Economic Development Administration to eliminate both the ethanol subsidy and all taxes on estates, known as the death tax....MORE
Opponents of ethanol subsidies got a boost Monday from Koch Industries as the company announced its opposition to the giveaways on the eve of a major vote in the Senate.
Sen. Tom Coburn (R-Okla.) is pushing a vote on an amendment Tuesday that would end ethanol subsidies and eliminate tariffs on foreign supplies of the biofuel. That would allow companies to use sugar-based Brazilian ethanol, which is both cheaper and less environmentally damaging than the domestic corn-based variety.I bet this will be the only page you see today with links to both HuffPo and NewsMax.
The issue has split the Republican Party, with free market advocates and deficits hawks pushing for elimination of the subsidies and corn-state politicians fighting back. The power broker Grover Norquist has battled Coburn, arguing that ending the handouts is equivalent to increasing taxes, meaning that candidates who signed a no-new-taxes pledge would be breaking their word.
The Kochs' entrance into the debate is unlikely to swing the vote toward Coburn on Tuesday, but threatens to reshape the long-term debate. The Koch brothers are among the biggest backers of the Republican Party and conservative groups. Their importance has only increased in the wake of the Citizens United Supreme Court ruling, which allows the Koch brothers to use their private company's money to secretly fund attack ads or prop up national organizations....MORE