Obama Speech Misfired on Ethanol, Ag Policy

WASHINGTON - President Barak Obama's call to "stop subsidizing yesterday's energy"
in his State of the Union speech last night was welcome, but the
President missed an opportunity to focus attention on the misguided
federal subsidies that prop up the corn ethanol industry and the equally
expensive and wasteful subsidies paid to farmers.

"While we heartily back the president's call to roll back fossil fuel
subsidies, ethanol is every bit yesterday's biofuel," said
Environmental Working Group Senior Vice-President Craig Cox. "That's
true whether it's ethanol from corn, corn-stover or the mythical
"next-generation" ethanol that always seems to be around the corner but
never here. With that in mind, we should make the $5.5 billion a year in
corn ethanol tax credits part of history too."

President Obama emphasized his desire to promote greater innovation
and more investment in clean energy technologies, specifically urging an
end to tax credits and other subsidies for fossil fuels.

Rather than furthering his goal to make America "the first country to
have a million electric vehicles on the road by 2015," however, Obama's
focus on biofuels as the way "to break our dependence on oil" would
have the opposite effect if it means sending billions more taxpayers
dollars to corn country to finance ethanol infrastructure, Cox said.
"Building an ethanol infrastructure at taxpayer's expense will just lock
us further into the past rather than lead us to tomorrow's energy
future," added Cox, who heads EWG's Ames, Iowa, office.

Also absent from the President's remarks or the Republican response,
Cox noted, was any mention of protecting the environment or fundamental
reform of food and farm policies that currently throw money at the
largest producers of commodity crops and the wealthiest landowners while
encouraging practices that promote soil erosion and contaminate rivers,
streams and once-bountiful waters.

Farm households making more than $210,000 are year - three times US
average household income - harvest more than $30,000 a year in
government subsidies. So-called direct payments go out to them every
year in good times or bad, and times have been very good on the farm
recently even in the face of a severe recession. Farm income in 2010 is
projected to be up 31 percent from 2009 and to be 21 percent higher than
the 10-year average.

"We heard a lot from the Republicans, the Tea Party and the President
himself that we don't have the money to do many of things we would like
to do," said Cox. "But we do have the money in the food and
agriculture budget ¬- it's just going to the wrong places. There is no
better example of misdirected priorities than the Republican Study
Committee's ‘bold' plan to cut spending, which proposes to cut a $56
million program to encourage organic food production while giving a pass
to $5 billion a year in direct payments."

EWG analysis shows that cutting the lavish direct payments to the
largest growers by 14 percent would generate enough money to purchase
all the fresh fruits and vegetables needed to improve school lunches
under the recently enacted Healthy, Hunger Free Kids Act. A mere 7
percent cut in direct payments would fill the shortfalls in funding for
conservation programs that are critical to protecting water and soil.

"The President's call for 80 percent of our energy from clean energy
is laudable, but we urge the President and Congress to make sure that
energy is truly clean. Lawmakers need to hear from citizens whose
drinking water has been polluted by natural gas drilling. And those who
make their living in waters choked by agricultural runoff that pollutes
Chesapeake Bay and the Mississippi River Basin," Cox concluded.