June 15, 2015

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Streetwise Professor posts on ethanol. Remember Bush the W was responsible for the mandate, proving the GOP can’t be trusted either. It’s incredibly stupid, so you would assume President Trainwreck was the culprit, but it was W.

About 19 months ago I wrote about RINsanity, i.e., the United States’ nutty ethanol (and other biofuel) program. RINsanity has long outlived the phenomenon (Lin-sanity) that inspired the neologism. A couple of weeks ago, the EPA announced the ethanol and biodiesel quotas . . . for 2014. Who said time travel is impossible? That Einstein. What an idiot!  (The EPA also announced quotas for 2015 and 2016.)

In a nutshell, despite protestations to the contrary, the EPA largely conceded to the reality of the E10 “blend wall” (the fact that the vast bulk of auto engines are incapable of burning fuel with more than 10 percent ethanol), and announced quotas that were (a) smaller than the market expected, and (b) smaller than the statutory amounts that Congress specified in its farseeing omniscience 10 years ago. At the same time, the EPA decreed larger quotas for biodiesel.

As a result, the market did the splits. The price of ethanol RIN credits that count towards the ethanol quota plunged, while the price of biodiesel RIN credits that count towards the biodiesel quota rose. Scott Irwin and Darrell Good have all the gory details here. (Those are the guys to follow on this issue, folks. I’m just kibitzing.)

As a result, pretty much everyone is upset. The nauseating biofuel lobby is screaming bloody murder because the ethanol quota is too small, and is threatening to go to court. Those holding ethanol credits are fuming due to the forty plus percent price decline.

This all points out the dysfunctional nature of environmental markets in which the supply is set by some opaque politicized bureaucratic process unhinged from economic reality. (The European CO2 credit market is another classic example.) …

… Of course it’s not just that the market is crazy: it’s crazy that there is a market. Ethanol is an economic and environmental and humanitarian monstrosity. Yes, ethanol would play a role without subsidies or mandates. But a much smaller role. Forcing and inducing its use is costly, not environmentally beneficial, and raises the price of food, which hits the poorest the hardest. So this crazy market shouldn’t exist in the first place. I think I need another drink.



The beginning of the week should not pass without comment on the congressional defeat for the president. Noah Rothman says it signals the end of his regime.

President Barack Obama wanted Congress to pass a variety of trade-related proposals, and he didn’t want to have to rely on Republican votes in order to see that happen. He lobbied his fellow Democrats in favor of trade, and he lobbied them hard. In the end, it wasn’t enough. On Friday, the president endured a stern censure from the very members of the party for whom he once served as a savior. Barack Obama’s presidency is all but over. It’s Hillary Clinton’s party now, but she does not seem inclined to lead it so much as to emerge as its supervisor by default and through a process of attrition. She is not in a hurry to rush that process, and there is no alternative Democratic leader waiting in the wings. Inadvertently, what House Democrats did on Friday was to decapitate their own party. …



Politico was not much nicer.

President Barack Obama responded to a stinging defeat dealt by his own party by declaring victory.

It is a common tactic in Washington to downplay bad news, but the White House brought it to a new level on Friday after House Democrats soundly defeated a package of free trade legislation that the president had personally implored them to pass. The White House chose to highlight the fact that one part of the package passed, even though two approvals were necessary to give Obama the trade authority he needs to negotiate the 12-nation Trans-Pacific Partnership.

“It’s déjà vu all over again,” a chipper White House press secretary Josh Earnest said Friday, praising what he called “bipartisan support” for the legislation. The 126-302 defeat of a key trade measure was just a glitch: “To the surprise of very few, another procedural snafu has emerged. These kinds of entanglements are endemic to the House of Representatives.’’

But the truth was more complex, and more troubling for the president. …



Roger Simon posts on the NY Times’ Rubion Derangement Syndrome. 

It took several years of George W. Bush’s presidency for the mainstream media to develop full-blown Bush Derangement Syndrome (BDS),  but the New York Times — the MSM’s very flagship — seems to have contracted Rubio Derangement Syndrome (RDS) over a year before there is even a Republican nominee, let alone a sitting president.

First the Times exposed Rubio for being some senatorial version of Speed Racer (sorry, Marco, four traffic violations in seventeen years just won’t cut it) and now they’re after him for the cardinal sin of having difficulty paying off his student loans.  Perhaps they would prefer a super rich candidate who would never have such problems like, say, Nancy Pelosi or, um, Hillary Clinton.

But never mind.  Rubio exhibited prolifigacy by buying himself what the Times characterized as an $80,000 “luxury speedboat.”   One can assume the reporters — Steve Eder and Michael Barbaro — have never heard J. P. Morgan’s saying about such purchases or have never  been to Monte Carlo (or even seen its tennis tournament on TV) if they think you can pick up a “luxury speedboat” or a luxury anything aquatic for a measly eighty grand. Those things usually start at about twenty times that figure.  As it turns out, Rubio bought a family fishing boat. …



More from Andrew Malcolm who has pictures of Rubio’s “luxury speedboat” and John Kerry’s $7,000,000 sailboat.

You may have noticed virtually all actual and potential Republican candidates for president have been attacking Hillary Clinton for months. That’s a factor of her own actions like violating government rules to use a private email server while Secretary of State, among other questionable behavior.

And it’s a measure of her currently being the prohibitive favorite to become the Democrat nominee for 2016.

Who gets attacked most is usually a reliable sign of who is feared most. Recall the Washington Post invested a few thousand words last winter on Wisconsin Republican Gov. Scott Walker, revealing that he not only did not attend an Ivy League school but left MarquetteUniversity for a job before completing his fourth year.

So, it was surprisingly revealing in recent days when the liberal N.Y. Times went after Florida Republican Sen. Marco Rubio as part of its spotty vetting of select candidates. Rubio has been steadily in the top tier of GOP candidates since announcing. …