As much as the village likes to pretend otherwise, fact is, Republicans don't give a damn about the deficit. They grow them, while Democratic administrations shrink them. That's the objective and provable reality, no matter what anyone else might think.
However, the teabaggers have imposed a new level of party discipline on Republicans. Witness Kay Bailey Hutchison and Olympia Snowe signing on to the Senate GOP's unilateral ban on earmarks. They refused to sign on just a few months ago, but both are slated to face teabagger challenges, and think that these late-minute flip flops will protect them. It won't, they are both goners, but they'll try and pretend otherwise for as long as they can until they realize that their best chances for reelection are to go independent.
But the earmark thing won't be the only hot potato Republicans wrestle with this coming congressional term.
In a clear sign of momentum against ethanol subsidies, a bipartisan group of more than a dozen senators has signed onto a letter urging Senate leaders to let the subsidies expire during this Congress, a move that could put many officials in a tricky political spot and could even have ramifications for the 2012 presidential race.
The letter, which I obtained from a source, was authored by senators Dianne Feinstein and Jon Kyl, and includes a number of Democrats and Republicans, including John McCain, Susan Collins, Richard Burr, and Mike Enzi. This is key, because the question of whether the subsidies should expire is emerging as a key test -- just like earmarks -- of whether Republicans are serious about reining in spending and the deficit.
Ethanol subsidies have had a two-track level of support -- farm state legislators of both parties support them, as well as anyone with presidential ambitions. Iowa, anyone? But even beyond the primaries, The midwest is a key electoral battleground, and ethanol is huge in Iowa, Illinois, Minnesota, Nebraska, Ohio, South Dakota, and Wisconsin. South Dakota isn't competitive at the presidential level, but one congressional district in Nebraska is (1 EV) as well as another 68 EVs in the other states (minus a handful they'll lose in next year reapportionment).
That's quite a few senators who will fight to protect free government money to their agricultural sector. Not a single one of those states is represented in the letter calling for the abolition of those subsidies. And it's significant money. From the letter:
We are writing to make you aware that we do not support an extension of either the 54 cent-per-gallon tariff on ethanol imports or the 45 cent-per-gallon subsidy for blending ethanol into gasoline. These provisions are fiscally irresponsible and environmentally unwise, and their extension would make our country more dependent on foreign oil.
Subsidizing blending ethanol into gasoline is fiscally indefensible. If the current subsidy is extended for five years, the Federal Treasury would pay oil companies at least $31 billion to use 69 billion gallons of corn ethanol that the Federal Renewable Fuels Standard already requires them to use. We cannot afford to pay industry for following the law....
Democrats will fall along regional lines on the matter, like they always do. Wasteful spending in Iowa won't seem so wasteful to Iowa's Democratic congressional delegation. And in normal times, the same would apply to the region's Republicans.
But these aren't normal times, with the teabaggers demanding that Republicans pay more than lip service to deficit reduction. And there's no doubt that these subsidies aren't just wasteful, but they're unsound on any possible policy grounds. Subsidizing Big Oil and Big Agribusiness for environmentally unsound ethanol subsidies is madness, and has only persisted as long as it has because of Iowa's presidential clout.
And in a presidential cycle where Republicans will be tripping over themselves to curry favor with the teabaggers and with Iowans ... well, this topic should prove entertaining to say the least.
