Gov. Rendell’s Plan to raise gas prices and subsidize Big Ethanol

Gas prices are high. As previously noted in this blog, part of the reason for high prices is the mandated use of ethanol fuels – forcing refineries to retool.

As Monday’s Wall Street Journal adds, the combination of ethanol mandates and tariffs on imported ethanol (added to duties on ethanol sales) drive up gasoline prices while profiting big ethanol producers. Current legislation would eliminate these tariffs, and lower gasoline prices, but faces stiff opposition from the ethanol lobby.

What does Governor Rendell have to say? In a new proposal announced today, he proposes adding an additional mandate on the percent of fuel sales that must be ethanol based. Let me repeat – he proposes adding an additional mandate on the percent of fuel sales that must be ethanol based. He also proposes giving ethanol producers a nice $30 million in taxpayer subsidy.

What could he possibly be thinking, beyond the obvious benefits to ethanol companies supporting his campaign?