The ethanol-in-gasoline mandate is once more being placed under scrutiny by members of the House of Representatives. Now, a group of prominent conservatives is once more pressuring the House to overturn the Environmental Protection Agency’s ethanol-rate increases, which were put in place to lower gasoline pump prices.
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Conservatives are pressing House lawmakers to overturn the Environmental Protection Agency’s higher-ethanol gasoline blend requirements, which were implemented as a means to lower fuel prices but that free-market critics say raise costs and harm taxpayers.
A group of conservative leaders and longtime President Donald Trump allies sent House lawmakers a letter on Thursday calling for the overturning of the EPA’s biofuel-blending quotas, arguing that the mandates raise fuel prices.
Nearly three dozen conservatives signed onto the letter, including Unleash Prosperity Chairman Stephen Moore, Americans for Tax Reform President Grover Norquist, Domestic Energy Producers Alliance president and CEO Jerry Simmons, and billionaire oilman Harold Hamm, according to Bloomberg.
The group said in the letter that the quotas are “a regressive tax on American workers, businesses and families.”
There’s just one problem: Such a cut in ethanol addition won’t sit well with states like Iowa, with a big (and generally conservative) agricultural constituency. But that has to be balanced against the costs added to every gallon of fuel by the mandate:
The EPA’s final rule has been praised by agricultural groups such as corn and soybean farmers, as it creates a market for corn- and soy-based ethanol fuel. But oil refiners have argued that the standards raise compliance costs, especially for small and midsized refiners. The oil industry argues that the rise in compliance costs could fall onto consumers.
“For American workers, businesses and families already strained by inflation and high gas prices, this is the last thing they need,” Tom Pyle, president of the American Energy Alliance that spearheaded the effort, told Bloomberg.
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It’s an interesting problem from both sides.
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If the House were to leave the mandate as is or remove it altogether, which doesn’t seem likely, there would seem to be nothing preventing the oil companies from choosing to offer the ethanol blends, or to prevent consumers from buying them. And perhaps that’s the best answer to this problem: Remove subsidies, let markets decide. Markets are often messy; they are imperfect (because they consist of imperfect people), but they generally get things right in the end.
There’s another problem, of course, that’s not mentioned, not by the prominent conservatives, and not by anyone in the House. But there’s a constitutional argument to be made; nowhere in the Constitution is the federal government given any power to regulate or subsidize commodities such as gasoline. That being so, the 10th Amendment would preclude any such subsidy or mandate; indeed, it would preclude the existence of the Environmental Protection Agency altogether, along with a host of other federal bureaucracies. But, let’s face it, the 10th Amendment has been largely ignored by the federal government in recent years, and it doesn’t look like we’re going to be moving that ratchet back anytime soon.
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