Marine industry players, regardless of their geographic location, have reason to keep an eye on the results of today’s Iowa caucus.
Since Congress in 2005 required that oil refiners blend ethanol into gasoline, the legislation has been a boon to Iowa corn farmers.
As Iowans caucus today in the first step of the Democratic and Republican presidential nomination process, ethanol remains a hot topic in the state.
“When I look out my window and see farms that have built and expanded and improved, it’s because of the ethanol mandate,” Arlington, Iowa, farmer Tim Recker told The New York Times.
Recker, a Republican, said his decision at the presidential caucuses on Monday will be driven by what candidates have said about the 2005 law, which created the Renewable Fuel Standard.
That’s because Sen. Ted Cruz of Texas, one of the Republican front-runners, has called for an end to subsidies for all forms of energy, as well as a five-year phaseout of the renewable fuel mandate that created the ethanol economy in Iowa.
A coalition that includes oil companies, environmentalists, grocery manufacturers, livestock farmers and humanitarian advocates is pushing Congress to weaken or repeal the requirement. As soon as this week, just days after the Iowa caucuses close, the U.S. Senate could vote on a measure to roll back the Renewable Fuel Standard.
“Culturally, anything that supports corn is seen as good,” Bruce Babcock, an economist at Iowa State University, pondering whether ethanol’s grip here was slipping, told the Times. “But if Ted Cruz wins the caucus, there’s your answer.”
The Washington Post reports that at nearly every event he has attended in Iowa during the past month, Cruz has been asked about a very specific issue: ethanol.
So what is Cruz's stance on ethanol, why is he being asked about it and how could it influence his fortunes in this state's caucuses tonight?
Cruz decries the mandate as a Washington-driven, anti-free market scam that makes people rich.
"There's a reason the lobbyists want the people of Iowa focused on the RFS," Cruz said in Independence, Iowa. "Because as long as the RFS is front and center, it keeps Iowa dependent on Washington."
Cruz wants to do away with subsidies on all energy sources, leveling the playing field and allowing the market to dictate conditions and prices, the Washington Post reports.