Update:  The O reports that high hopes were unfounded.  The story doesn’t even mention any limits on it, so probably the patch to bar the subsidy for ethanol from corn (which Kevin suggested had been added and had support from all sides) was not included.  So welcome to Iowa West folks, spending $5M a year to accomplish absolutely nothing.

Apparently not enough Legislators bothered to read the report from Oregon State, much less this fantastic demolition of the ethanol fantasy.

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The Oregonian reports that HB 2210 was NOT included in the big tax package the Senate Finance Committee passed yesterday, and that it will receive separate consideration:

A separate bill designed to deliver $4.4 million worth of tax breaks to those who help produce or use biofuels, already passed by the House, will be considered separately by the Senate panel.

An encouraging sign? Possibly–though I can hear the sounds of arms being twisted all the way over here …

Objectively, this bill should fail; the OSU study alone suggests just how little benefit would be provided by these subsidies that, once begun, tend to become permanent barnacles on the ship of state, slowing its progress forever. However, this is a classic public choice problem: this bill hurts everyone a bit but, arrayed against that, there is a tiny handful who stand to make a bonanza from this bill. The tiny handful are well represented in Salem, and they have managed to confound enough of the environmental lobbyists that the green groups now argue, in essence, that we should tax Oregon’s working families to give subsidies to Big Ag so that they will make even more money on biofuels, despite oil being well north of $60/bbl (where it is likely to remain).

It will be interesting to see what happens, no doubt.

This entry was posted on Tuesday, June 19th, 2007 at 9:01 am and is filed under Economy, Energy Future, Environment. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.