GOP Candidates: End Tax Credits for Ethanol, Wind Energy Print
Commentary/Politics - Iowa Politics
Written by Lynn Campbell   
Tuesday, 01 November 2011 14:36

Four Republican presidential candidates called Tuesday for phasing out federal energy tax credits, including those for wind energy and ethanol, the corn-based fuel additive.

The calls came despite Iowa being the nation’s top producer of corn and (according to the American Wind Energy Association) ranking second in the nation for wind-energy capacity.

“I believe we have to get rid of all tax incentives for all energy,” said former Pennsylvania U.S. Senator Rick Santorum. “I think we have to have a level playing field. ... I don’t think we should create a heart attack for any industry, but we should phase them out over a period of time.”

Five candidates spoke at the manufacturing forum attended by roughly 550 people, televised nationally by PBS, and hosted by the National Association of Manufacturers – the nation’s largest industrial trade association, representing 12,000 manufacturing companies in all 50 states.

Each candidate was interviewed on stage separately at the Pella, Iowa, Global Pavilion at Vermeer Corporation, a manufacturer of industrial and agricultural equipment.

Governor Terry Branstad, one of the moderators, asked candidates if they support extending the federal wind-energy tax credit, which is slated to expire at the end of 2012 and has expired three times. He said U.S. Senator Chuck Grassley (R-Iowa) is among those calling to extend the credit for four years.

Santorum said the ethanol tax credit should be phased out over five years, as well as tax credits for gas and oil.

Texas Governor Rick Perry offered a similar position, despite his state leading the nation in the generation of wind energy. He said if states want to compete against each other, they can implement their own incentives.

“The federal government needs to be completely out of the energy business, picking winners and losers,” Perry said.

Perry said he supports the federal tax credits in research and development in energy, “but the idea of us giving $535 million to some solar company just because they’ve got a good lobbyist that can get them into the White House, that’s nuts.”

Minnesota U.S. Representative Michele Bachmann called for a re-examination of all energy tax credits, including ethanol. “I’d like to pull them back and let these industries be more self-supporting,” she said.

U.S. Representative Ron Paul (R-Texas), who also participated in the event, has long been opposed to energy subsidies.

Vermeer Corporation President and CEO Mary Andringa, who is also chair of the National Association of Manufacturers, told that she agrees with the market-driven approach.

“The industries will find their way to ... compete if we allow them to,” Andringa said. “I think we’re an entrepreneurial country. ... In a way, I just think we have to allow our companies to be innovative, to figure out better ways to do things and then let us compete.”

Mindy Larsen Poldberg, spokesperson for the Iowa Corn Growers Association, earlier told that the larger concern among corn growers is when politicians call for phasing out subsidies on ethanol and not other sources of energy, such as oil and wind energy – which also receive subsidies.

“If a person looked at the subsidies given to the oil industry and ethanol industry and you eliminate them all, it’s a level playing field,” said Poldberg, whose group advocates for corn growers through lobbying and legislative efforts. “The concern that corn growers have is when policymakers choose only to eliminate ethanol subsidies.”

Former U.S. House Speaker Newt Gingrich, who has supported ethanol subsidies, said any tax credit should be for at least 10 years with a rolling annual renewal. He said tax credits for one or two years are inefficient and “really stupid for America.”

Two of the GOP front-runners, former Godfather’s Pizza CEO Herman Cain and former Massachusetts Governor Mitt Romney, were absent from Tuesday’s forum.

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