ETHANOL TRANSPARENCY PROJECT

The Ethanol Transparency Project (ETP) is a jointly sponsored program of the Agribusiness Council (ABC)’s Heritage Preservation Committee and State Agribusiness Council Coordinating Committee (S/ABC).

Background
As a sequel to ABC’s Ag Corruption Project (ACP), which focused on concentration and anti-competitive price-fixing in the ag/food economy during the mid-1990s, ETP galvanized in the aftermath of the Energy Policy Act of 2005. This highly controversial law, among other requirements, mandated a massive increase in ethanol use to 7.5 billion gallons in blended gasoline by 2012. The resultant market volatility with fuel and food price spikes – consequences of higher animal feed costs, market volatility and oil refining uncertainties – has led to a widened public awakening on the growing distortions and hidden costs of ethanol’s empty promises.

As public curiosity and investment surrounding the ethanol "craze" has increased, so has a new recognition: the so-called ethanol industry (based largely on agricultural commodities -- primarily corn) is one of the most shrouded and non-transparent sectors in the ag/energy nexus. More enlightened public participation is needed in this growing policy debate; and the lack of impartial facts on ownership and control of ethanol production – transportation, marketing, finance – warrants a more careful, timely illumination.

Ethanol benefits are very mixed for many farmers. It is increasingly clear that cattle ranchers, chicken farmers, dairymen, hog farmers, and others are suffering -- and thus, the food system and energy nexus, in general, are also in acute distress.

American taxpayers and legislators need to understand who are the primary beneficiaries of this massive, multi-tiered and federally-mandated subsidy/tax credit/tariff protection regime in order to chart a course to resolve this problem.

EARLY  WARNINGS—Nicholas Hollis has been outspoken since the mid-1980s, describing ethanol subsidies as a form of Russian roulette with the world economic system.
 

Problem
The lack of transparency in ethanol is not accidental. Over a period of nearly thirty years, since ethanol was "re-activated" during the Carter Administration after OPEC’s second oil price shock, the corn-based fuel additive has advanced behind a phalanx of trade associations, captive farm cooperatives, public relations/law firms, and media programming and campaign contributions. A corresponding masking of key facets in this inexorable surge – has shrouded an alarming concentration of actual control within ethanol’s "inner circle" – and led the United States into a dangerous dilemma which now threatens our nation’s economy and democratic institutions. Remedial steps must begin with education on the truth concerning ethanol’s many claims and the nature of this complex, subsidy-driven regime.

Ag Corruption Project
ABC and its international affiliate, Agri-Energy Roundtable (AER), have been outspoken critics of agricultural subsidies and growing concentration in key ag sectors since the mid-1980s. These interlinked issues have resulted in fundamental distortions to our nation’s food system and threatened our agricultural heritage, leading to the disappearance of America’s independent family farmers. Similarly, the complex weave of subsidies and political influence accelerates non-economic, anti-market policies which undermine international trade and development thereby damaging the U.S. role as the world’s most reliable and abundant "breadbasket."

ABC initiated the Ag Corruption Project (ACP) following revelations stemming from the ADM price-fixing case plea settlement of October 1996 and subsequent U.S. District Court-Chicago cases (United States v. Andreas et al - 96 CR 762). Numerous memoranda and articles were developed and circulated, culminating in two speeches: (1) Economic Crime Summit in St. Louis, Missouri (April 1998) sponsored by the Department of Justice/National White Collar Crime Center and (2) BioEnergy ’98 (October 1998) in Madison, Wisconsin. The speeches were delivered by ABC president Nicholas E. Hollis and generated widespread interest, particularly the BioEnergy speech which provided a history of certain anti-competitive actions linked with ethanol expansion and the association sector.

Notwithstanding these efforts, the "ethanol juggernaut" continued to gather political support. Today, the headlong rush to erect dozens of planned new ethanol production facilities in response to the artificially-created markets (Energy Policy Act of 2005 and Energy Independence and Security Act of 2007) has reached a "tipping point" which carries enormous economic and environmental risks.

BOYCOTT ETHANOL -- ETP director Nicholas Hollis at a gas station sign in South Carolina advertising ethanol-free fuel.  A growing network of independent stations are rejecting ethanol and gaining motorist loyalty by offering ethanol-free gas.  www.pure-gas.org

Action Plan
ETP is generating information through news articles and media appearances with a focus on ethanol’s inner workings. ETP is providing memoranda and advisory services to a growing subscriber network of journalists, decision-makers, and activists researching aspects of ethanol. Drawing upon ABC’s extensive database/historical archives on ethanol and the ongoing public policy debate, ETP is offering services and educational materials useful to local, state, and the broader national/international debate surrounding ethanol (and other biofuels).

Results include increased information flow, new contacts leading to productive networking, activist success in curbing local environmental abuses, Washington dialogue among affected groups, and timely public policy inputs to Congress and the Executive Branch.

Leadership
Founded in 1967 after a White House meeting between President Lyndon Johnson and Henry Heinz of Heinz Food Company, the Agribusiness Council (ABC) has developed considerable experience in working with agricultural and mainstream media as well as state/local agricultural organizations. ABC’s Heritage Preservation Committee (HPC) has been in the vanguard of efforts to protect agricultural history in coordinating with state counterpart associations, historical societies, and others interested in preserving agriculture’s role in the broader understanding of American history.

ABC president Nicholas E. Hollis has been outspoken about ag subsidy distortions, including ethanol, since the early 1980s. Previously he organized and led campaigns for export expansion in staff leadership positions with the U.S. Chamber of Commerce, the National Association of Manufacturers (NAM), and the State Department (USAID), spearheading more than 70 missions abroad to promote U.S. export trade/development. More recently Hollis has been interviewed on Fox New Channel’s "Weekend Live" (see video), Wisconsin Public Radio, Minneapolis FM-1280 Radio’s "The Patriot," sponsored by the Taxpayers League of Minnesota, and he has been quoted on ethanol issues by CBS News, Associated Press, London Financial Times, Chicago Tribune, Milwaukee Journal Sentinel, Fredericksburg Freelance Star, Culpeper Star-Exponent, Miami Herald, Roll Call, Legal Times and others. Since 2003, he has visited/lectured in 38 states and 6 countries while publishing more than 250 articles on ethanol (see Archives).

BIOFUELS IN ASIA—Nicholas Hollis addresses media at press briefing after ASEAN regional conference in Manila which included sessions on sugar cane/bagasse energy technology.

Method of Operation
ETP utilizes grants and subscriber funds to develop research and educational kits on aspects of the "ethanol regime" in relation to key economic, environmental, political, and organizational dimensions of the ethanol phenomenon. ETP circulates and publicizes results of its past/present research via internet articles, traditional media, and educational institutions.

A example of ETP campaign operations is illustrated in the Milwaukee Journal Sentinel article, "Lawmakers Push State Ethanol Mandate" (January 30, 2005 -- see excerpt). This effort helped spark an activist drive around the Badger State targeting Madison lawmakers which eventually blocked the proposed 10% ethanol blend requirement under consideration by the Wisconsin State Senate (March 2006). Other states – including Iowa, Colorado, North Dakota – have also blocked ethanol mandates.

Future Direction of Activities
E
TP will survey contributors and subscribers (including anonymous donors) with the objective of convening those interested in developing programs and activities surrounding ethanol issues. Numerous local coordinators around the country are already networking with ABC program coordinators and directors. ABC/ETP will provide resources and inspiration to lead the country out of the ethanol "box canyon."

Supporters
ETP is partially supported by voluntary contributions from individuals, foundations, and organizations seeking a researched counterpoint on ethanol presented to the public. In particular, supporters want promulgated research to lift the fog currently shrouding the inner-workings of the so called ethanol industry.

Budget
ETP is financed through contributions, grants, honoraria, and private donations as its programs reach further into the public policy debate on ethanol. Private funding is essential to maintain the program’s independence from individual institutions, government agencies, and/or sector groups with specific agendas.

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Additional Ethanol References

The Agribusiness Council
Ethanol Transparency Project
P.O. Box 5565
Washington DC 20016

Tel: (202) 296-4563

Email: agenergy@aol.com

www.agribusinesscouncil.org

 

"Strengthening Agribusiness Integrity through Association Action"

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