[Congressional Record Volume 157, Number 85 (Tuesday, June 14, 2011)]
[Senate]
[Pages S3746-S3748]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                ETHANOL

  Mr. CHAMBLISS. Madam President, I rise today to speak about the 
amendment offered by my colleague, the Senator from Oklahoma, to the 
Economic Development Revitalization Act which would repeal the 
volumetric ethanol excise tax credit. His amendment is No. 436.
  For months, there has been very heated public debate surrounding the 
blender tax credit for ethanol and the tariff on imported ethanol. Some 
of my colleagues advocate repealing ethanol tax incentives immediately, 
while others are adamantly opposed to changing course on tax policy 
that was enacted at the end of the last Congress and would extend these 
tax credits through the end of this year. Regardless, it is clear that 
Congress must make a decision on whether to reform the ethanol blenders 
tax credit and import tariff this year.
  In my home State of Georgia, I see both the positive and the negative 
effects this tax policy has had. While it has spurred the growth of the 
ethanol industry, some say it has caused drastic increases in the price 
of corn-based feedstock.
  A new study prepared for the upcoming G20 meeting shows that biofuel 
subsidies are directly related to food price volatility. I believe that 
because the credit is set to expire in December of this year and many 
ethanol producers have the credit embedded in their business plans, 
Congress should not immediately repeal the tax credit. When it expires 
at the end of this year--even though I have supported this tax credit 
for all the years I have

[[Page S3747]]

served in both the House and the Senate--I think the time has come for 
it to end. If we tell the blenders today that at the end of this year 
this tax credit is going to expire, it needs to expire then. So I do 
not intend to support an extension of that tax credit beginning upon 
the expiration at the end of this year.
  Regardless of where one stands on the underlying issue itself, I 
believe the amendment deserves to have a vote on its merits and not be 
blocked by procedural tactics. Because so much attention has been paid 
to the issue and because we have had such extensive debates, this 
amendment deserves an up-or-down vote, rather than being stopped by a 
filibuster. For this reason, I intend to vote in favor of the motion to 
invoke cloture on the amendment of the Senator from Oklahoma, and I 
encourage my colleagues to do the same.
  I yield the floor.
  Mr. COBURN. Madam President, may I make an inquiry of the Chair?
  The ACTING PRESIDENT pro tempore. The Senator from Oklahoma.
  Mr. COBURN. How much time remains for the Republicans in morning 
business?
  The ACTING PRESIDENT pro tempore. There is 15 minutes 20 seconds.
  Mr. COBURN. I thank the Chair.
  These are interesting days in our country. We find ourselves in a 
very deep hole, and it is not the fault of the people; it is the fault 
of the Congress. We continue to spend money we do not have on things we 
do not need. When we do that personally, we end up filing bankruptcy. 
Pretty soon, we run out of new credit cards to take on, and we get to 
the point where we can't pay our debts. That is a question that is in 
front of our country today as our economy is struggling and we have 
this massive debt. We ought to be about every small, medium, and large 
step we can take to solve the problem, not to solve the problem by 
saying we can't pay our bills but to solve the problem so we create a 
prosperous future for our kids and those who follow us.
  There is a lot of controversy over the amendment I offered, and it is 
inaccurately claimed by the majority leader that this amendment was 
rule XIV'd. It was not rule XIV'd. According to the procedures of the 
Senate, you can file cloture on any amendment at any time. That is a 
privilege every Senator has. Why would somebody file cloture on an 
amendment? It is because, over the first 5\1/2\ months of this year, 
through the leadership of the Senate, we have been unable to have a 
free and open debate and free and open offering of amendments. Because 
the procedure is rarely used does not mean it is not ethical and not 
accurate. As a matter of fact, the reason the procedure was put there 
was in case at a point in time your rights as a Senator to offer 
amendments are being limited by the majority. That is why we have this 
rule. Because you can take 16 of your colleagues and file a cloture 
petition and, therefore, have a vote on your amendment.
  So what we are hearing going on in the background today is, the 
reason you shouldn't vote for this amendment, even though you agree we 
should get rid of and save $3 billion, much as the Senator from 
California outlined, $3 billion that the very people who are blending 
and receiving the $3 billion don't want, the argument is, it is because 
they don't like the way the amendment came to the floor. Explain to the 
people at home, you have an opportunity to save this country $3 billion 
and you know it is the right policy, but you are not going to vote for 
it because you don't like the way the amendment came to the floor. I 
would remind my colleagues that of the $3 billion we are going to save, 
1.2 billion of it we are going to borrow from China, if we go on and 
spend it, and we are going to charge that 1.2 billion to our kids and 
grandkids. The interesting point is, we have grown, over 20-some years, 
to rely on ethanol for 7 percent of our fuel, and it has been a very 
expensive process. It is expensive directly because when you go to buy 
gasoline today, it is not the price you pay at the pump that you are 
actually paying. Take all the subsidies and all the tax credits and all 
the low-interest loans and all the nonrepayment of all the grants and 
all the moneys that have been put into this program, and when you buy 
that tank of gas, every gallon that you put into your car after you pay 
for it, you already paid $1.72 through your taxes to have that gallon 
there.
  So we are not getting rid of the mandate on ethanol. It is 7\1/2\ 
percent. It has helped us in some ways. It is a very inefficient fuel 
that causes us to consume more fuel, produce more CO2. But 
the fact is, we have an amendment in the Chamber that is designed to 
take away a subsidy, and the only reason we are taking away the subsidy 
is because in law we are saying you have to do it anyway.
  I would introduce, for the record, a letter from the refiners that 
states--this is the National Petroleum Refiners Association, 
representing 97 percent of the people who get this tax credit--97 
percent of the $3 billion. They say they don't want the $3 billion. The 
vote is going to come down to something very clear. We are going to 
give $3 billion to some of the most profitable companies in America or 
we are not. The interesting fact is, they are saying: Please don't give 
it to us. Please don't give us this money.
  Think of the time when we are borrowing the money to give to them and 
they are saying don't give it to us. We are going to have a vote in the 
Chamber and very likely not win because of a procedure or because of 
parochial interests. The fact is, every gallon of ethanol that is 
blended to gasoline, whoever does the blending, gets 45 cents a gallon, 
and they don't need it because they are going to blend it anyway. So 
the real question is, Will we continue to be ignorant in Washington of 
the common sense the American people want us to have? The common sense 
is, if you are paying somebody to do something and by law they have to 
do it anyway and then they write you a letter and say: Please don't pay 
me anymore to do this, I am going to do it anyway, why would we 
continue to send them the money? Why would we continue to do that, 
especially when 40 percent of it we have to borrow from the Chinese to 
be able to pay it to the American oil company? It makes no sense. There 
is no logic you can come up with. The calculations out of Iowa State 
University on this $3 billion is that the amount of jobs that have come 
out of this in the past cost $14 million a year per job--14 million a 
year per job created out of this subsidy.
  No wonder we are broke. No wonder we are failing financially. No 
wonder we are failing our children and our grandchildren, because we 
continue to do things that don't have any correlation with logic or 
common sense. I know the arguments. I know the argument is that, well, 
we passed this last year as part of the extension. Well, as a 
Republican, I was one of the few Republicans who did not vote for that 
extension. Because not only did we pass additional tax cuts and 
additional unpaid programs, we cut no spending to be able to pay for 
it. So what we did was borrow a whole bunch more money and not solve 
any of the critical issues that lie in front of our country.
  Forty percent of last year's corn crop went to ethanol. As a matter 
of fact, there is so much ethanol production, last year we shipped 400 
million gallons overseas. That is great, except when you take the time 
to think about that with that 400 million gallons, we sent $500 million 
worth of subsidy. So now we are subsidizing the ethanol that goes to 
Europe with your tax dollars so they can have cheaper gasoline than we 
have, because they are taking $1.72 per gallon and getting the benefit 
of our tax dollars to have cheaper ethanol in Europe than they can get 
from other places.

  So there is nothing about this that makes sense, other than if you 
are a wonk and study the politics and the procedures and the 
parochialism that goes on inside the political body. That is what has 
gotten us into trouble. We are more interested in power and position 
and party. I am sick of both parties. We better start focusing on the 
real problems in front of our country. We are going to have a $1.7 
trillion deficit this year, and the way you get rid of that is 1 
billion or 2 billion or 3 billion at a time.
  Here is something that makes absolutely no sense. Here is something 
that has no true demand for it. Here is something that is $3 billion 
that the people we are paying it to say they don't want, and we are not 
going to take them up on it? What part of stupid are we? This is like a 
Ferrell movie. It doesn't make sense. It is comedic.

[[Page S3748]]

We have had a lot of debate. Let me just talk for a minute about what 
is going on in the agricultural community throughout this country if 
you are a poultry, milk or livestock producer.
  You can't bring your cattle to feedlots right now because corn is too 
expensive--$7.65 a bushel yesterday. You can't afford to fatten your 
cattle, so they are not bringing them in from the range. We are 
slaughtering dairy cows all across this country because 70 percent of 
the cost of dairy cattle is the corn you feed them. We are going to get 
all sorts of untoward interruptions and price increases in our food if 
we continue this policy. Seventy percent of the cost for chickens is 
feed. We are having chicken processors close and go into bankruptcy. We 
are having chicken raisers, the actual chicken farms--a lot in 
Oklahoma, a lot in Arkansas, a lot throughout the South, even over in 
Delaware and in Virginia--can't afford to feed the chickens. So what is 
going to happen because we have this false subsidy? The fact is, right 
now, 15 percent of the food increases in this country that you have 
seen in the last year are directly associated with this policy--
directly associated with this policy. That doesn't have any effect on 
the fact that what could we do by sending $7 corn out of this country 
to our balance of payments, which would help our trade imbalance? 
Instead, we are burning it, and it is a highly inefficient fuel. It is 
a highly inefficient fuel. Everybody knows that when they fill up with 
15 percent or 10 percent ethanol, they get much poorer gas mileage. 
Everybody knows that. In Oklahoma, we have all these stations where it 
says ``ethanol free.'' Why do people pay 10 or 15 cents more a gallon? 
Because they win on mileage. They actually get better performance when 
they don't have ethanol in their fuel. We all know that. It is just in 
some States you don't have that option. We are fortunate. We can still 
buy real gas.
  I understand we have about 3 minutes remaining. I will close with the 
following statement. This is going to be a historic vote, not about 
ethanol, not about subsidies. It is going to be a historic vote that 
sends a signal to the American people. Either the people in Washington 
get it and are going to stop wasting money on programs they don't need 
to waste money on and they are going to start acting in the best long-
term interests of the country, they are either going to do that or they 
are not. So when we see the results of this vote, you are going to have 
a hard time explaining: I voted against that because I didn't like the 
way the amendment came up. The fact is, here is $3 billion we don't 
have to spend over the next 6 months. If we don't spend it, that is $3 
billion we are not going to have to borrow from our children and that 
they are not going to be paying interest on for the next 30 years.
  This comes down to the point in time, does this Senate recognize the 
amount of trouble we are in, and are Senators willing to give up 
parochial interests, procedural interests, are they willing to do what 
is necessary to put this country back on course? My hope and prayer is 
they are.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from North Dakota.

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