Today Taxpayers for Common Sense released a comprehensive report on the largest subsidy to corn ethanol, the Volumetric Ethanol Excise Tax Credit. The report, Big Oil, Big Corn: An In-depth Look at the Volumetric Ethanol Excise Tax Credit (VEETC), outlines the history of how we got here and the multitude of problems the $6 billion ethanol tax credit poses. The report discusses other government policies that already ensure a market for ethanol, the exploding cost of the VEETC to the taxpayers, the impact ethanol subsidies have on increasing the price of goods in other markets, and the environmental costs of ethanol production. With presidential hopefuls stumping in Iowa, ethanol has been at the top of the agenda, and candidates have widely divergent positions on the issue. It will likely continue to be at the forefront of the debate both in the race for the White House and for Congress.

After 33 years, it’s time to let the ethanol industry stand on its own.

Taxpayers for Common Sense, alongside the National Turkey Federation, and Friends of the Earth, held a teleconference with reporters today discussing the report’s findings and the wasteful subsidies that go to ethanol. Comments on the report and ethanol subsidies from today’s teleconference:

Taxpayers for Common Sense Vice President Steve Ellis, said,

“We wrote this report because we are at a turning point on the ethanol issue. A political consensus has developed to end or shrink the existing tax credit, but at the same time ethanol boosters are trying to pull a fast one on taxpayers, shifting the subsidy to other forms. After thirty three years of handouts costing taxpayers tens of billions of dollars the industry should be able to stand on its own. Even leaving aside the considerable food and environmental problems created by ethanol, we are staring down the barrel of a $1.65 trillion deficit – we cannot afford to continue to line the pockets of this profitable industry with tax breaks or any other form of subsidy.”

National Turkey Federation President Joel Brandenberger said,

“The current U.S. biofuels policies have caused serious harm to the turkey industry and without reform will continue to do so for the foreseeable future. The turkey industry supports the need to advance alternative sources of energy, but it is time the mature corn-based ethanol industry operates on a level playing field with other industries that rely on corn as their major input. Favoring fuel production at the expense of food production hurts agriculture as a whole and the consumers that ultimately purchase our products. Ending the blender’s credit is the first step to make the corn-based ethanol industry compete fairly in the marketplace. For more than 30 years there has been a production tax credit for ethanol and it is time to end federal assistance to the fuel blend. The blender’s credit has distorted the corn market, increased the cost of feeding food animals, and compressed production margins. This has resulted in major production cuts, which caused substantial job losses and bankruptcies across rural America.”

Kate McMahon, biofuels campaign coordinator for Friends of the Earth, said,

“Taxpayers for Common Sense’s new report should be considered a go-to resource on why the ethanol subsidy is unnecessary and wasteful. Continuing to spend billions of dollars each year on corn ethanol simply makes no sense, especially when studies have shown ethanol to be more environmentally damaging than traditional oil. Ending the subsidy today could save billions of dollars and put an end to more than 30 years of corporate welfare for this dirty and polluting industry.”