Ethanol Mandates may be lead to more of a misallocation of market resources than tax credits. What has happened is that financial interests have been formed as a result of government policies that now have financial resources to protect their privileged place in government. Those getting rich from government have an interest in Big Government allocating resources and making policy rather than Free Market, which profits by supplying needs of real world consumers.
National Journal’s Influence Alley, – on the intersection of money, politics and policy - reports:
The Coalition for E85 (85-percent ethanol) says that if the tax credit does expire, millions of Flex Fuel vehicle drivers could pay as much as 38 cents more per gallon and the roughly 2,500 small businesses that have invested in E85 could be hurt.
The coalition is also emphasizing that ethanol decreases U.S. reliance on foreign oil and is better for the environment than other fuels.
Members of the coalition include Propel Fuels, Protec, Clean Fuels Development Coalition and other companies in the ethanol industry.