California Dairy Producers Praise Feinstein's Call to End Subsidy

December 2, 2010 11:48 AM

California group says ethanol subsidies have harmed the state’s dairies

Source: Western United Dairymen news release

California-based Western United Dairymen (WUD) is praising Sen. Dianne Feinstein, D-Calif., for asking her fellow senators to end federal subsidies for ethanol. 

In a letter to Senate Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., Feinstein and her colleagues note that they do not support an extension of either the 54-cent-per-gallon tariff on ethanol imports or the 45-cent-per-gallon subsidy for blending ethanol into gasoline. The senators note that these existing "provisions are fiscally irresponsible and environmentally unwise and make our country more dependent on foreign oil."

WUD has a long history of working with the California congressional delegation on responsible federal conservation and renewable energy policy. In this case, WUD worked with Senator Feinstein’s staff to circulate the letter to other dairy groups along with a cover letter for them to use to ask their Senators to sign on.

"We are very appreciative of Senator Feinstein’s leadership in trying to cure this flawed policy and we are thankful that Senator Boxer has joined in calling for this much needed change," WUD CEO Michael Mash said. "Massively subsidizing the conversion of food to fuel with corn-based ethanol subsidies has harmed California dairy families immensely by making us less competitive in an ever more global dairy marketplace. We thank Senator Feinstein for her efforts to effect positive change to an ethanol policy that has eroded the international competitiveness of California's dairy families.
Marsh said the subsidies must stop immediately. "Turning feed grains into fuel will do nothing to reduce hunger in developing nations and only exacerbate the problem here at home," he said. "These subsidies have driven up the cost of all feed grains and, due to inefficiencies in the process, will not move the U.S. along the road to energy independence.  It is time to move on before this government policy wreaks additional irreparable damage to the U.S. animal agricultural sector."

In their letter, the senators also cite a 2010 study by the Congressional Budget Office that determined the ethanol tax credits cost $1.78 for each gallon of gasoline consumption reduced. The letter cites an estimate from Iowa State University that states "a one-year extension of the ethanol subsidy and tariff would lead to only 427 additional direct domestic jobs at a cost of almost $6 billion, or roughly $14 million of taxpayer money per job."

In only a few days, 16 senators joined Feinstein in a bi-partisan call for the ethanol provisions to lapse.  Joining California’s senior senator are:  Barbara Boxer, D-Calif., Jon Kyl, R-Ariz., Richard Burr, R-N.C.), Jack Reed, D-R.I.), Mike Enzi, R-Wy., Bob Bennett, R-Utah, Ben Cardin, D-Md., Jim Webb, D-Va., John McCain, R-Ariz., Sheldon Whitehouse, D-R.I., Tom Coburn, R-Okla., Susan Collins, R-Maine, Bob Corker, R-Tenn., Jeanne Shaheen, D-N.H., Mark Warner, D-Va., and Chris Coons, D-Del.

WUD is a voluntary membership organization representing more than 60% of the milk produced in California.

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Spell Check

12/3/2010 03:12 AM

  I'm dairy producer, and ehanol has hurt no one. Just because the chinese and INdians are buying grains to feed their growing middle classes, ethanol has to take a hit strickly for political possioning cause these countries are mad about paying more for food, and are holding the Dairy industry hostage.​

12/3/2010 03:27 AM

  Are they not feeding DDG's or WDG? There seems to be a disconnect and misunderstanding that once the ethanol is made there is no feed by-product. It's not like oil gentlemen! Once the ethanol is made there is still a feed by-product available to feed!

12/23/2010 11:15 PM

  Amen to that. This is has ruined the Dairy industry & other livestock producers. Once again.......government stay out of business, mine included. I want no help from the taxpayer dollar. I want them to get the best deal for dairy products at the store. Father government, please don't keep asking me to spend tax dollars to put myself out of business. To Ethanol's subsidized credit, it has raised fertilizer prices, raised food retail prices, taken the profit out of livestock production, & since I'm not a corn farmer, I can't speak for them, but with input increases, I wonder if corn farmers are making much, if any more profit or just rolling more dollars around. Glad to see people waking up & seeing Ethanol for the dirty environment challenge that it is. It takes a lot of input expenses to make a fuel that is inefficient while that can't be used in most cars without getting less mileage. Now if only the consuming public would see the light on the huge anti-trust violations in all sectors of Agriculture that control the retail food prices and keep ag commodities at a non-profitability level 60% of the time. We spend the other 40% of the time paying for the 60%.


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