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GOP platform’s new opposition to ethanol subsidies has ag world buzzing

There’s anxious buzz sweeping across corn country about an abrupt change in the Republican platform on corn ethanol that was adopted at the party’s convention in St. Paul. 
 
Reversing its stance of 2004, the Republican platform opposes continuing federal subsidies for corn ethanol, something that is widely credited with giving the industry the financial foundation that has propelled it to rapid expansion. The platform supports Republican presidential candidate Sen. John McCain’s position on ethanol and other subsidies (McCain voted against the 2007 Energy Bill and the 2008 Farm Bill because of the large subsidies and tax breaks contained in the legislation). 
 
“It’s a little alarming that we as a Republican Party are taking that stance,” said Brad Finstad of Comfry, Minn. “In corn country there will be some independence from the GOP on the issue,” said the three-term Republican who is ranking minority member on the Minnesota House Agriculture Finance Division.

Finstad noted that McCain isn’t necessarily against corn ethanol, but prefers “a free-market method” of financing.
 
“It will provoke some discussion, and that’s good,” Finstad said. 
 
Big topic at AgNite party
It certainly provoked discussion at the $1 million AgNite party, hosted by the Minnesota Agri-Growth Council, attended by some 5,000 delegates, farm leaders, and journalists at the GOP Convention. 
 
According to a report in the Progressive Farmer, published by DTN, there was plenty of grumbling from the Minnesota Corn Growers Association, the National Corn Growers, the National Renewable Fuels Association and other leaders of commodity and industry groups. 
 
DTN quoted Bruce Stockman, executive director of the Minnesota Corn Growers Association, as saying that “without incentives, renewable energy cannot compete against heavily subsidized oil.”
 
“There will be some independence from the Republican Party on this issue,” Finstad said. 
 
But it’s something that Al Juhnke said the DFL will remind rural area voters about.

McCain opposed farm bill as well
Juhnke, a Willmar, Minn., DFLer and chairman of the House Agriculture Finance Division, said both he and DFL Rep. Collin Peterson, who chairs the House Agriculture Committee in Washington, tell rural voters that McCain not only opposes ethanol subsidies but also voted against the 2008 Farm Bill. 
 
Whether the McCain and Republican platform positions on ethanol will have a major political impact in Minnesota is questionable, given the state’s lean toward Obama. 
 
However, the DTN report said it could have an important impact in toss-up states like Michigan, Ohio, Pennsylvania and Iowa.
 
DTN political correspondent Jerry Hagstrom (jerry.hagstrom@dtn.com) said: “Democratic candidates most often win when rural enthusiasm is low and the Republican winning percentage goes down in the rural areas of swing states … that’s how Bill Clinton captured the presidency in 1992 and 1996.”

                                                                                                                                                                                                                                                          

Correction: An earlier version of this story reported that the Minesota Corn Growers Association contributed $75,000 to Sen. John McCain’s campaign. The association did not contribute to the McCain campaign, but rather contributed to the AgNite party during the GOP Convention that was hosted by the Minnesota Agri-Growth Council.

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Comments (3)

  1. Submitted by Brian Larson on 09/07/2008 - 11:18 am.

    “without incentives, renewable energy cannot compete against heavily subsidized oil.

    Incentive sounds better than subsidized doesn’t it? Government shouldn’t pick favorites because they often get it wrong. Just because it is renewable doesn’t make it good. Subsidizing corn based ethanol has been a big mistake, costing the consumer and tax payer too much. High priced corn raises the price many food and non-food item. Corn ethanol is burning food that hungry people need.

    It would be better to just give small family farmers government checks to buy rual votes, than give millions to big ag corporations.

    Small government and the free market is the best.

  2. Submitted by Dave Ladd on 09/08/2008 - 11:22 am.

    I think if you asked farmers which has a greater immediate impact on their operations – the 2008 farm bill or input costs/energy – the vast majority would say the high cost of energy. Furthermore, if they look beyond the farm bill toward the issues of excessive regulation, taxes, a comprehensive strategy to develop domestic sources of energy, etc most farmers realize that managing their operations entails many aspects.

    It is also important to remember that both the commodity AND livestock sectors are important pieces of the agriculture economy. Although renewable fuels are an important piece of the equation, there is more to agriculture and rural development than ethanol.

    The bottomline is, there are payment mechanisms in place which continue to serve as a “shock absorber” for farmers and the only piece of the new farm bill in play re: commodities is that direct payments are continuing to be made.

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