Hoover Institution Press Today Releases Book Highlighting the Implications of Federal Corn Ethanol PolicyCorn Ethanol: Who Pays? Who Wins?By Ken G. Glozer

STANFORD, Calif.--(BUSINESS WIRE)--Hoover Institution Press today released Corn Ethanol: Who Pays? Who Wins? by Ken G. Glozer. In Corn Ethanol, Ken Glozer presents the history, the promises, and the truth about federal corn ethanol policy. The book is based on an in-depth, fact-based policy evaluation of each of the major claims made by the advocates of the “command-and-control-type” policy enacted in 2005–7 (15-billion-gallon ethanol blend in gasoline quantity mandate, 45 cents per gallon deep subsidy, and major trade protection of 59.5 cents per gallon on imported ethanol). He examines, in detail, whether any of the top five claims made by those who advocated (corn/ethanol producers) the current federal corn ethanol policy are true. He found only one: the policy does indeed create jobs in rural areas of the ten largest corn-producing states in the Midwest but possibly reduces rural employment nationwide.

According to Glozer, the nation and its taxpayers and consumers would be far better off—nearly half a trillion dollars better off from 2008 to 2017—if the government adopted a policy of relying on competitive markets for corn ethanol and thereby avoiding the substantial costs imposed on consumers and taxpayers by the current corn ethanol mandate policy. He bases this conclusion on a Department of Energy, Energy Information Administration (EIA) forecast showing that a competitive market policy for ethanol delivers two-thirds the ethanol of the mandate quantity without the huge federal budget costs and consumer costs associated with current ethanol policy. Glozer’s point, based on the EIA forecast, is that consumers and taxpayers do not benefit from the policy. The policy does not reduce petroleum imports or improve US energy security or reduce gasoline prices as claimed by the ethanol special interests. Also, local, national, and global environments are actually harmed by the policy. His detailed analysis shows that the major beneficiaries are an estimated 62,000 corn farm landowners, farmers, and ethanol producers who are concentrated in ten Midwestern states (more than 80 percent of all corn and ethanol are produced in these states) with Iowa and Illinois at the top of the list. Glozer’s analysis amply discloses that current ethanol policy claims to be an energy policy but is really a wealth transfer policy.

Ken G. Glozer is president of OMB Professionals, Inc., a Washington, DC–based energy consulting firm. He was a senior executive service career professional (twenty-six years) with the White House Office of Management and Budget in the energy, environment, and agriculture areas.

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