Congressman Griffith’s Weekly E-Newsletter 08.06.12
Food versus Fuel
In 2005, Congress passed a law – the Energy Policy Act – with the purpose of reducing the U.S.’s dependence on foreign oil. Seven years later, according to a January 23, 2012 CRS report, our dependence on foreign oil hasn’t been reduced at all, and the average price of corn has jumped from $2 per bushel to almost $8 per bushel. Certain provisions in the Energy Policy Act, coupled with one of the worst droughts since the 1950s, are producing serious problems for the country.
Included in the ’05 law is a mandated minimum usage requirement – commonly referred to as the Renewable Fuel Standard (RFS) – which states that a minimum volume of biofuels is to be used in the national transportation fuel supply each year. In plain English, this means that corn – previously used by people and animals for food – is now also a fuel source. Roughly 40 percent of the nation’s corn crop now goes to ethanol production or, to think of it a different way, ethanol consumes more corn than animal agriculture.
With nearly two-thirds of the country facing extreme drought, corn prices have spiked and some analysts are predicting that the U.S. may even experience a corn shortage this summer. When corn prices rise, the impact is far reaching – many of the products in the grocery store have corn (of some form) in them, and corn is used as a feed stock for many of the animal products we eat. As corn grows scarcer and more costly, the cost of producing many foods will rise. This means consumers - like you and me - will be paying more at the grocery store. Fortunately for the animal agriculture industry, food manufacturers, foodservice providers, and consumers, there is a “safety valve” built into the law. In the event of severe harm to the economy of a state, a region, or the U.S., the Administrator of the EPA can reduce the required amount of renewable fuel for that year.
Last week I joined 156 Members of the House in a letter to EPA Administrator, Lisa Jackson, urging her to take action. To reiterate the requests we made in the letter, on Thursday, August 2, 2012, I also participated in a bipartisan press conference. My colleagues and I believe that if the EPA adjusts the RFS mandate down to align with current market conditions, the federal government can help avoid a lot of the economic consequences associated with the looming corn shortage. While we can’t fix and control everything, this flexibility may be the difference between a calamity and a rough patch.
As a long-time legislator, I’m well aware that there are laws we pass which have results we didn't intend. I believe we should acknowledge such mistakes, fix them, and move forward. At Thursday’s press conference, my colleague Congressman Peter Welch (D-VT) did just that. He admitted we made a mistake with respect to our ethanol policy saying, “no other product has a tri-fecta where there is a tariff barrier, where there’s a government subsidy, and where there’s a government mandate.” I want to commend him and all my colleagues that signed onto this letter and joined me at the press conference. The problem with the RFS mandate can be rectified quickly by Administrator Jackson. When that is done, I look forward to participating in the larger debate in Congress about ethanol policy going forward, so that we can ensure we get it right this time around.
The Crooked Road
At more than 300 miles long, the Crooked Road connects nine major heritage venues and more than 50 affiliated venues all across Southwest Virginia. In an effort to share this driving route with the country and the world, the Crooked Road board is working to secure a National Heritage Area (NHA) designation for the road. Last week, my office was proud to attend each of the NHA proposal events in Bristol, Gate City, Galax, Floyd, and Big Stone Gap. Though our community is well aware of it, one of the reasons I support the National Heritage Area designation is to help bring nationwide attention to our heritage. The designation, in addition to helping promote economic development, will serve as a platform to promote and celebrate our unique musical traditions. I sincerely appreciate the folks working hard for this designation, and I, as well as my office, will continue to assist with their efforts.
As always, if you have questions, concerns, or comments, feel free to contact my office. You can call my Abingdon office at 276-525-1405 or my Christiansburg office at 540-381-5671. To reach my office via email, please visit my website at www.morgangriffith.house.gov.