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07 June 2015 - How Not to Win Friends and Influence People

For the second week in a row on Samuelson Sez, I can use the same opening line, and here it is - Finally, after years of discussion, debate and comment filing, the Environmental Protection Agency ruled against America’s farmers.

Last week I used the line to write about the Clean Water Act Rules announced by EPA that made just about everybody in agriculture unhappy , if not downright angry. Then a few days later, the EPA announced (nearly two years late) the Renewable Fuels Standards formula that sets the amount of renewable fuels, primarily ethanol, that needs to be blended with gasoline. That announcement made corn growers and ethanol producers angry.

Let me share some history on Clean Air legislation. . . the first act passed by Congress, the Air Pollution Control Act was enacted in 1955; in 1963 it was the Clean Air Act; and in 1967 it was the Air Quality Act with major amendments in 1970, 1977 and 1990.

But let’s focus on the current act and the total renewable fuel volume that was set by Congress in the Clean Air Act. It called for 20.5-billion gallons of renewable fuel in the U.S. energy supply for 2015, and for 2016, it called for 22.5-billion gallons.

So what did the EPA announce last week? It set the RFS formula for ethanol in gasoline for 2015 at 16.3 billion gallons and for next year 17.4- billion gallons, far less than the numbers set by Congress.

Chip Bowling, President of the National Corn Growers Assn. said - “The only beneficiary of the EPA’s decision is Big Oil, which has continually sought to undermine the development of clean, renewable fuels. Unfortunately, the EPA’s gift to Big Oil comes at the expense of family farmers, American consumers and the air we breathe.” But guess what, Big Oil was unhappy because it wanted even lower numbers, not willing to surrender any market share to ethanol.

So after waiting for years, in the period of one week, we get two announcements from EPA that tell me, if you want to learn how to win friends and influence people, don’t ask the EPA for advice.

My thoughts on Samuelson Sez.