Ethanol Subsidies: Even Stupider Than We Thought

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Why do we import 4 million gallons of ethanol from Brazil every year and then export 2 million gallons of it right back? Because U.S. ethanol regulations require us to use a certain amount of “advanced” ethanol — i.e., ethanol that produces less carbon than gasoline, which corn ethanol mostly doesn’t — but it turns out we’re not doing too well on the advanced ethanol front. Our corn ethanol subsidies are so lucrative that this is where all our R&D dollars go. But American ingenuity knows no bounds, so we’re meeting the regulation by exporting our crappy corn ethanol to Brazil and receiving their sugar cane ethanol in return. It’s all the same, but cane ethanol counts as advanced, so shipping our stuff to them and their stuff to us allows us to meet the minimum requirements for use of advanced ethanol. It all makes sense in a demented sort of way.

This inspiring tale comes from Timothy Wise, who has more details here. Once again, we learn that ethanol subsidies are possibly the stupidest government program ever invented. And that’s saying a lot.

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Corrupt leaders the world over can (and will) try to shut down the truth, but when the truth has millions of people on its side, you can't keep it down for good. And there's no more powerful or urgent argument for your support of Mother Jones' journalism right now than that. We need to raise about $450,000 to hit our online fundraising budget in these next few months, so please read more from Monika and pitch in if you can.

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