In Part I we saw that the Renewable Fuels Association (RFA) pays for shoddy studies and then cites them to fear-monger into getting more tax dollars. Hypocritically, when they are challenged with a critical point on ethanol, they attempt to cast doubt by questioning the source of funding from the challenger (as shown here).
Here in Part II, I will show that the RFA is guilty of misrepresentation so blatant that it can only be called dishonesty.
Perhaps the biggest irony in all of this is that our tax dollars via the ethanol subsidies keep groups like the RFA in business. The circle goes like this: Tax dollars and mandates create and support an ethanol industry. Some of the money from the ethanol industry goes to fund lobbies like the RFA. The RFA uses that money to pay for bogus studies that predict calamity if the tax dollars don’t keep coming their way.
The Integrity of the RFA
Not only does the RFA pay for self-serving research so they can lobby Congress into getting their hands on more tax dollars, they have no qualms about just making things up. In Part I, I discussed my Twitter exchanges with Robert White, who is employed by the RFA. I noticed a number of Tweets from Mr. White along the following lines. He and I had been going back and forth, and he claimed that ethanol couldn’t possibly compete without both mandates and subsidies, because Big Oil “controls the opportunity.” After pointing out that this wasn’t true; that they could be entrepreneurs and build E85 stations across the Midwest and Big Oil couldn’t stop them, he responded: “Build our own & compete against Big Oil that receives $321B/yr in subsidies?! Well conceived plan…”
The assertion, repeated many times, was that Big Oil receives $321 billion per year in subsidies. So I asked for a source, and he linked me back to an RFA press release:
Toronto – November 9, 2010 – The International Energy Agency World Energy Outlook today revealed that global fossil-fuel subsidies amounted to US $312 billion in 2009.
You see the problem? Not only is it not Big Oil that received that much in subsidies, it wasn’t even oil period. Those were spread across oil, natural gas, and coal. Further, the report said that the majority of the subsidies were spent in developing nations. India and China combined to spend $40 billion of the total.
How deceptive is it to play that off as a Big Oil subsidy? About as deceptive as if I added up all global renewable energy subsidies – wind, solar, biofuels, etc. – and wrote a headline that called those corn ethanol subsidies. If I did that, my credibility would rightly be in tatters, but it’s all a day’s work at the RFA.
I called Mr. White’s attention to it, but his response was a red herring: “Report clearly compares global biofuels to global fossil fuels, didn’t adjust it 4 my benefit. $57B to $312B – far cry from equal.” Right. My problem is that the RFA press release headline said that the $312 billion represented oil subsidies. Mr. White took it a step further and called them “Big Oil” subsidies. That is clearly deception, and in his response he avoided that question when I pointed it out. Further — while I am certainly not in favor of fossil fuel subsidies — $57 billion for renewable energy is 18% of the $312 billion identified for fossil fuels. But renewable energy makes up only 7% of the global energy mix, according to the report. Nuclear made up 6% of the mix, with fossil fuels comprising the other 87%. So while renewable subsidies are only 18% of fossil fuel subsidies, renewable production is only 8% of the level of fossil fuel production. Thus, proportionally, and contrary to Mr. White’s claim — renewable energy is being subsidized at over twice the rate of fossil fuels. I have no problem with that idea, but let’s not be so sloppy with the truth.
The funny thing in this debate is that the ethanol lobby and their supporters in Congress are acting as if we are talking about repealing the mandate. One wonders what hysterics they would resort to if that was under consideration. But this is only about a redundant tax credit on their ethanol production. Demand is mandated by law to grow by 25% between now and 2015. As I saw someone comment recently: “If you can’t make it in business when customers are legally required to buy your product, then you are in the wrong business.”
One of the problems with Twitter is that you can only write in short blurbs. This is great for people who write in slogans, or throw out deceptive arguments. It often takes much longer to debunk a deceptive argument than to make one. To make it, you just make a statement. To debunk them, you have to explain why it is wrong and support that argument.
Because Twitter is not the best format for that, I challenged Mr. White to debate his claims. Not once or twice, but five times I asked him to debate his claims. We even got an offer to host the debate, which I agreed to. But the silence from Mr. White on that point was deafening. A written debate allows for fact-checking. It allows for getting a bit deeper into a topic than sound bites like “Domestic fuel is better.”
So I will challenge Robert White, Bob Dinneen, or anyone else at the RFA to back up their claims. I challenge them to take up a three-round written debate on the issue of ethanol subsidies. I propose the following:
Resolved: Extension of the VEETC is a good value for taxpayers.
I would propose a 1,000 word limit per entry, and the entries would be hosted on my blog, and as long as they are unedited, anywhere the RFA wishes to host them.