The federal Renewable Fuel Standard, aka the ethanol mandate, is often assumed to be a boon for the Midwest. Surely, the grain belt must benefit, even if everyone else has to suffer with inferior fuel at the gas pumps.
Except, they don’t. Most people in the agricultural heart of America suffer from this boondoggle, too.
Corn and soybeans — while excellent as foods — are far less efficient than oil as a fuel source. When these commodities are diverted from the table to the pump, Midwestern Americans — like the rest of us — have to pay more for both fuel and food. Whether it’s a small trucking business in Minnesota, a fast-food franchise in Iowa or your average Joe in Illinois filling up his tank on the way to the grocery store, they’re all paying more.
Livestock and poultry producers pay more, too. Corn and soybeans are staple ingredients of the feed they use on their ranches and farms. The ethanol mandate artificially increases their cost of doing business by raising the cost of feed corn and soybean meal. That’s why the National Chicken Council, National Cattlemen’s Beef Association, National Pork Producers Council, the Milk Producers Council and the National Turkey Federation all oppose the mandate.
Four of the top six turkey-producing states are Minnesota, Arkansas, Indiana and Missouri. Iowa ranks No. 1 in egg production and processing where, according to the Iowa Poultry Association, the chickens consume “55 million bushels of corn and 504,500 tons of soybean meal yearly.” Nebraska, Kansas, Oklahoma and Iowa are some of America’s top beef-producing states.
Yet another concern is that ethanol has proved to be harmful to smaller engines like those that power motorcycles and boats. Some top corn-growing states also happen to be the states with the most motorcycles per capita. According to a report from the Motley Fool, Wisconsin (1 motorcycle per 17.8 people), Iowa (1 motorcycle per 16.5 people) and South Dakota (1 motorcycle per 8.9 people) rank in the top four. Furthermore, there are boat owners aplenty in the Land of 10,000 Lakes. The Mississippi River, too, is a hugely popular playground for recreational boaters.
Anyone tempted to declare the ethanol mandate an economic win for America’s heartland should pause to tally the costs it extracts from the general population. The math is not so pretty when it encompasses the whole equation.
• Nicolas Loris is The Heritage Foundation’s Herbert and Joyce Morgan Fellow, specializing in energy, environmental and regulatory policy analysis. Please follow @Heritage and @NiconomistLoris.
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