Economics 101, Republican Style

According to Greenwire (a subcription-based electronic daily on all news environmental), House Speaker Denny Hastert (R-IL) told reporters yesterday that increasing the supply of ethanol available to refineries would have no positive effect of any kind. “I just don’t see an economic plus in it right now” he said. Apparently, it’s just a Democrat myth that increasing the supply of something will have a favorable impact on the price of that something.

Of course, Hastert’s comment was made in the context of a discussion about tariffs the United States currently has in place to discourage ethanol imports from Brazil. Removing those tarrifs would certainly help motorists (whose fuel prices are going up in part because Congress mandated massive increases in ethanol consumption at the pump in the 2005 energy bill), but there would indeed be “no economic plus in it” for U.S. corn farmers, who are thriving on the ethanol shortages that are driving up fuel prices.

Sooner or later, politicians are going to choose between motorists and farmers. Denying economic reality isn’t going to hold off the day of reckoning.