The Value of Ethanol - The Huffington Post

Article by General Wesley Clark - Jan. 6, 2012

For the first time in nearly a decade, the ethanol industry will exist without any government financial support: the blenders' tax credit, created by Congress in 2004 to establish a healthy ethanol industry, expired on December 31, 2011.

The fact that the ethanol tax credit expired without fanfare or a fight came as no surprise. Ethanol producers and advocates have been saying with certainty that the industry can and will survive without it. But what would happen to the United States without ethanol as a fuel choice?

Let's go back in time to the origins of ethanol in America. Ethanol was at the birth of the American automotive industry, when Henry Ford designed his first cars to run on both gasoline and Midwest-made ethanol.

But in the 1920's, John D. Rockefeller, founder of Standard Oil, helped deliver a crippling blow to his competitor in the fuel market by funding political support for Prohibition, which banned distillation of alcohol fuels as well as consumable spirits. That was followed by a campaign in the late 1930s to displace ethanol's use as an anti-knock fuel ingredient with lead - one of the deadliest toxins known to man.

Then came the 1970s, and the first oil shock to our economy when OPEC flexed its muscle over the U.S. economy by dialing back oil production - creating gas lines, rationing and the start of a policy that would require us to create a permanent military presence in the Middle East, at great cost to the U.S. military and to taxpayers. In response to OPEC's manipulation of oil production to drive up costs, President Jimmy Carter set a new fuel standard of 10 percent ethanol blended into gasoline as a means of breaking the strategic hold that imported oil has over our economy.

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