Ethanol Tax Subsidy Issue May Not Be Over

Ethanol Tax Subsidy Issue May Not Be Over

Even House Action Might not end it.

The U.S. Senate voting to dump the ethanol incentive subsidy to ethanol producers cold virtually immediately catch some people off-guard. Both the timing and size of the margin of victory were rather intriguing. However, Washington is Washington, and rumors are floating out that even if the House would pass the bill to kill the subsidy, the issue may not be over.

What could remain if the house passed it, assuming President Obama signs the bill? It's always possible that it be brought back up in new legislation that would reestablish a subsidy, then phase it out over time. Some apparently believe the shock to the industry may be too great if all the money they've counted ion in their business plans is pulled away at once.

Even the sponsor of the Senate bill that passed is supposedly having second thoughts, after visiting with several Midwestern colleagues.

On the other hand some are hinting that Congress may be in a mood to end all subsidies. Some believe that is the message the general public is sending, and Congressmen, up for election every two years, know they must answer to their constituents every two years, may be ready to listen more closely to this time to talk of cutting back on subsidies.

One Indiana livestock producer with his nose to the ground and his ear to the phone quite often, says that while the initial vote was good news to livestock producers, he's still watching with a close eye what might happen with the bill at the house, or if senators develop a different opinion and decide to change their minds once again,

This one bears watching. And as this one goes, will other subsidies go when the 2012 Farm Bill gets under debate and down to brass tacks? And what about subsidies to oil companies? Conservation groups are holding their breath as well, wondering not if the budget-cutting axe will fall their direction, but instead how deeply it will cut.

TAGS: Livestock
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