McCain Right, Obama Wrong! (On Ethanol.)

Ethanol interests are helping to shape Barack Obama's energy and farm policies. On the issue of biofuels, Democratic nominee is accumulating troubling ties to Big Corn and conservative Republicans from farm states. Today, the New York Times details Obama's solidifying allegiance with the ethanol industry.

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Mr. Obama’s lead advisor on energy and environmental issues, Jason Grumet, came to the campaign from the National Commission on Energy Policy, a bipartisan initiative associated with Mr. Daschle and Bob Dole, the Kansas Republican who is also a former Senate majority leader and a big ethanol backer who had close ties to the agribusiness giant Archer Daniels Midland.

Not long after arriving in the Senate, Mr. Obama himself briefly provoked a controversy by flying at subsidized rates on corporate airplanes, including twice on jets owned by Archer Daniels Midland, which is the nation’s largest ethanol producer and is based in his home state.

Jason Furman, the Obama campaign’s economic policy director, said Mr. Obama’s stance on ethanol was based on its merits. “That is what has always motivated him on this issue, and will continue to determine his policy going forward,” Mr. Furman said.

Asked if Mr. Obama brought any predisposition or bias to the ethanol debate because he represents a corn-growing state that stands to benefit from a boom, Mr. Furman said, “He wants to represent the United States of America, and his policies are based on what’s best for the country.”

Mr. Daschle, a national co-chairman of the Obama campaign, said in a telephone interview on Friday that his role advising the Obama campaign on energy matters was limited. He said he was not a lobbyist for ethanol companies, but did speak publicly about renewable energy options and worked “with a number of associations and groups to orchestrate and coordinate their activities,” including the Governors’ Ethanol Coalition.

Of Mr. Obama, Mr. Daschle said, “He has a terrific policy staff and relies primarily on those key people to advise him on key issues, whether energy or climate change or other things.” [NYT]

Obama's opponent, John McCain, does not favor subsidies for domestic ethanol production. McCain seeks to relax trade barriers to facilitate imports of Brazilian sugar-cane derived ethanol, a move which Obama opposes. So far, Obama has not explained why he wants to keep cheaper more efficiently produced sugar cane ethanol out of U.S. markets. The most likely explanation is that Obama wants to protect his friends in the less efficient, less environmentally friendly U.S. corn ethanol industry.