Dr. Coburn on upcoming ethanol vote

Updated:  Koch Industries issued a letter Monday in support of Dr. Coburn’s amendment to end the ethanol tax earmark and tariff which Senator Coburn then released to the press.  The amendment may be voted on in Congress today, Tuesday June 14.  The letter is reproduced in full at the end of this story.

U.S. Senator Tom Coburn, M.D. (R-OK) released a statement Friday regarding the Senate’s plan to vote this coming Tuesday on his amendment (#436) to repeal the ethanol tax earmark and tariff.  Dr. Coburn’s amendment is identical to legislation (S. 871) he has introduced with Senator Dianne Feinstein (D-CA) to end the ethanol tax earmark and tariff.  If enacted, Dr. Coburn’s amendment would save $3 billion for the remainder of this year and $6 billion annually.  “The days of placing spending programs in the tax code and giving them holy status are over,” Dr. Coburn said. 

“Economic conservatives and leading free-market groups like the Club for Growth understand that using the tax code to pick winners and losers kills economic growth and job creation. 

"Today’s way of doing business is a tax increase on anyone who can’t hire a tax lobbyist or make large donations to special interest groups in Washington.  Taxpayers are tired of this game and expect us to eliminate wasteful special interest spending in all of its forms.

“Eliminating the ethanol tax earmark and tariff would be a big step toward restoring fiscal sanity in Washington.  I urge my colleagues to support my amendment on Tuesday.  Ethanol is bad economic policy, bad energy policy and bad environmental policy,” Dr. Coburn said.

Additional background on the amendment is here, including a letter of support from dozens of organizations on the left and right.

The Club for Growth’s statement regarding its decision to Key Vote the Coburn amendment is here.

Dr. Coburn has previously sent this letter to Americans for Tax Reform (ATR) President Grover Norquist urging ATR to end its inappropriate defense of tax earmarks. 


Koch Industries letter of support:

Senator Tom Coburn
172 Russell Senate Office Building
Washington, DC 20510

Dear Senator Coburn,

Koch Industries has opposed federal mandates and subsidies for decades. Our aim is to create a free market where consumers decide winners and losers based on which products they decide to buy, instead of government picking winners and losers based on which friends or products it chooses to subsidize.

One such government intervention is the tax credit that provides about $6 billion each year to blenders of ethanol. Lawmakers in the Senate could take a sensible step by approving an amendment sponsored by Senator Tom Coburn (R-OK.) that would eliminate this credit. We hold this position despite the fact that we benefit from these tax credits.

We oppose ethanol subsidies because they distort economic signals about price and demand and create inefficiencies that divert resources from productive activities to politically favored ones. We have also opposed subsidies for natural gas vehicles and other biofuels for these same reasons.

Still, our company now produces and blends ethanol, because while we would prefer that there be no government mandates or subsidies, once such laws are in place we will comply with them. We will not place our company or our employees at a competitive disadvantage in the mixed-market economy in which we compete.

Our government and public affairs activities are based on principles of economic freedom and property rights that are core values recognized and held by the majority of Americans. Koch will continue to lobby for the repeal of energy subsidies and mandates. We will work to transform the current, mixed-market economy into a true free-market economy.

Philip Ellender
President and COO Public Affairs
Koch Companies Public Sector, LLC