Recent pronouncements by declared Republican presidential candidate Tim Pawlenty favoring an end to ethanol subsidies and undeclared possible candidate Sarah Palin to end all energy subsides have been seen as evidence of political courage.
It has been a truism for a long time that ethanol subsidies are the third rail of politics in corn state Iowa, where the first national caucus is to be held. That is certainly the calculation of Mitt Romney, another declared candidate, who has recently announced his support for continuing the subsidies.
However, an article in Slate suggests that failure to support ethanol is no longer the kiss of death in Iowa, at least in Republican politics. It seems that a broad consensus is building up that the $6 billion-a-year ethanol subsidy needs to be phased out:
"It is the mainstream Republican position in Iowa that ethanol subsidies must be phased out. Chuck Grassley, the state's senior senator, has authored legislation that calls for a gradual decrease in the subsidy. The state's Republican governor and the state's agriculture commissioner support the reduction. Even the Iowa Renewable Fuels Association -- also known as the ethanol lobby -- supports this position."
That places the stands of Pawlenty and Palin, as well as the opposite track taken by Romney, in a new light. What seemed to be courage on the part of Pawlenty and Palin now seems to be a shrewd political move, positioning themselves right in the mainstream of Iowa Republican politics. Romney, on the other hand, appears to be more of a panderer than he already is.
The reason for this development is that the budget deficit has caused a lot of rethinking of government spending. An entitlement mentality in which one demands government largess as a matter of right has become a more difficult position to take. Also, since the ethanol industry is decades old and thus mature, the case for phasing out the subsidy becomes stronger.
This means that blind support for ethanol subsidies is no longer a sure ticket for winning the Iowa caucus, at least on the Republican side. But one can be sure that President Obama will be firmly on the side of keeping the subsidy money flowing and will attack whomever the Republicans nominate of wanting to hurt farmers. How effective this tactic will be remains to be seen.