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Will Indiana vote hurt ethanol?

DANIEL LOOKER 05/10/2012 @ 6:06pm Business Editor

The historic upset of Senator Dick Lugar by Indiana Treasurer Richard Mourdock in Tuesday’s Republican primary in that state may affect ethanol. 

At least that’s the view of Senator Tom Harkin, who like Lugar, is a past chairman of the Senate Agriculture Committee.

Harkin, noting that Mourdock takes a dim view of compromise with Democrats, told reporters Thursday that “his approach is not one that’s going to be helpful to ethanol.”

Harkin has his own perspective, of course, both as a Democrat and as one of Iowa’s two senators from both parties who have a long history of supporting the corn-based industry. 

In the past, Lugar co-sponsored bills with Harkin to provide infrastructure that would make it easier for ethanol to reach consumers, with proposed financial support for installing blender pumps, allowing federal guarantees for loans on ethanol pipelines, and mandating more flexible fuel vehicles from car makers.

In Harkin’s latest version of the bill (which hasn’t been passed) Lugar’s cosponsorship was missing. 

The veteran Indiana lawmaker’s willingness to compromise with Democrats on some legislation was viewed dimly by some Indiana Republicans. 

During the campaign, Mourdock disagreed with Lugar on support for ethanol mandates. 

“It’s not going to be good, especially if he gets on the Agriculture Committee,” Harkin said. “Will he evolve? Will he change his views? I don’t know.”

Thursday, a spokesman for Mourdoch said that the Republican senatorial candidate isn’t against alternative energy. 

"Richard Mourdock does not oppose the use of alternative, renewable energy, such as ethanol, biodiesel, wind or solar, which can reduce our dependence on foreign sources of oil.” said Mourdock spokesman Christopher Conner in an email message to Agriculture.com.

"Mourdock opposes federal subsidies and mandates, which are contrary to free market principles. The efficacy of alternative energy should be dictated by the market, Allowing consumers to have a choice and the market to determine the success of a product provides the best opportunity for long term success.”

During the only debate between Mourdock and Lugar, in April, the two candidates sparred over ethanol.

Mourdock argued that the mandate to blend ethanol into gasoline was keeping gas prices four to five cents a gallon higher than they would be otherwise, while Lugar said that ethanol blending is bringing the price down and creating jobs and good corn prices in the state. 

In many other areas of energy policy, such as the effects of EPA regulations on oil refineries, the candidates seemed to agree.  They got into energy policy early on, in this video that is still posted online. 

Shortly after the debate, Indiana Farm Bureau president Don Villwock corrected Mourdock’s assertion that ethanol raises gasoline prices.

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Mourdock is Right! 05/11/2012 @ 1:18pm I have seen this myth repeated several times before and again in this article. Mr Mourdock mentioned that corn ethanol costs more than gas. He is absolutely correct and Farm Bureau, once again is wrong. Not only that, Farm Bureau knows it and is once again trying to deceive the average person. Here is how the math works. As we all know, corn ethanol gets approx 2/3 the mileage of regular gasoline. So every gallon of ethanol should sell for 2/3 the price of a straight gallon of gasoline. But it does't! It's consistently more. Corn ethanol should be priced no higher than $2.66 a gallon to have the same mileage as gas. Furthermore, if we added up all the subsidies paid to the corn ethanol industry, including the subsidies on corn (over)production we would arrive at a true all-in cost to the taxpayer of $7-12 per gallon depending on which study you believe. So although corn ethanols nominal value is lower, its real cost is much, much higher than gasoline when adjusted for mileage. I didn't even add in the evironmental destruction that corn ethanol is causing as CRP acres (much of which is unfit to farm - think runoff) are converted to tillable as these rich farmers worship the almighty corn. If we accounted for all the extra environmental damage these farmers are causing via runoff, increased pesticide, insecticide, fertilizer, fungicide, corn on corn rotations and the like I have no idea what the true cost to society is? $15+/gallon true all-in societal cost for corn ethanol? Mourdock is absolutely right in his critique and I hope eventually Congress will pass a law making it illegal to burn up food to make fuel - its totally immoral. BTW, I am a farmer and landowner. It may not be popular to disagree with the agribusiness line, but as you can tell I feel strongly about this that the ag lobby has totally missed the boat in the pursuit of self-gain and profit regardless of cost or benefit to society.

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Re: Re: Mourdock is Right! 05/11/2012 @ 9:23pm Oh, and to clarify my calculation is based on a $4 gasoline price.

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