Ethanol plants are key to rebuilding rural economies

Some might call it a mini-miracle when a group of conservative and liberal lawmakers came to an agreement regarding the ethanol tax credit. Others — especially those among us who think ethanol the greatest hope to slingshot our way to greater energy independence — regard the two sides agreement regarding the tax credit as a potential disaster.

The conservative and liberal think-alikes want to kill the ethanol tax credit for different reasons. The liberals say that ethanol, at best, is environmentally neutral. The conservatives argue is that the tax credit is a waste of taxpayer dollars and that it is beyond time for ethanol to sink or swim on its own merits.

Their positions on the issue are deeply flawed and we suspect the Big Oil movers-and-shakers may have convinced them based on their well-oiled propaganda machine. Big Oil is awash in billions of subsidies of their own, which makes the conservative position hard to defend unless they go after those incentives. Liberals have never liked the ethanol tax credit, basing their opposition to outdated information that ignores new technology that makes the ethanol production industry much more efficient than it used to be. They also say that ethanol production takes acres away from food production, thus driving up food costs for those who can least afford it — the growing number of poor people within our own country.

At least the Senate provides a glimmer of hope. The compromise reached on the Bush-era tax cuts also includes an extension of the tax credit for ethanol use.

The tax credit, at the current rate of 45 cents per gallon, would be extended at least through 2011. Almost as good, the legislation extends the offsetting tariff on imported ethanol through the end of next year. It, too, will expire on Jan. 1 if no action is taken. The agriculture community certainly doesn't need an influx of foreign-produced ethanol at this point.


The conservatives and liberals who want to end the tax credit are clearly wrong.

It remains needed to help along the continued development and growth of the ethanol industry.

For better or worse, ethanol remains the No. 1 economic engine that can help rebuild rural economies. Ethanol plants, if they are owned by farmers and their profits kept within the community, add vitality to communities who have seen their fortunes decline with the loss of family farmers.

Clearly, the United States must move away from fossil fuel dependence. The continued dependence on foreign oil is a disaster for our economy and our future. The environment benefits from ethanol and the second-generation sources that are following it. We cannot take a step back on our energy policy, especially not now that the entire economy is in such a fragile state.

We need smart energy policy from Washington, and that clearly is what the ethanol tax credit is.

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