|
Middle Tennessee | Not much new below, but in the interest of documenting what I saw, I posted below to my blog,
-------------------------------------------------------------------
As a recreational consumer of left-leaning media, I observed some quantity of sardonic inquiry: What was the Tea Party’s goals in the show down with the Obama administration? We know of concern about federal debt and implementation of Obama care, but the bargaining position behind the government shut down was so weak and evolving, it left the impression at times of representing a pure act of protest.
Front and center in the negotiations were figures like Ted Cruz. In the background was Eric Cantor, who Tea Party politicians had supported for House majority leader in a challenge to Speaker Boehner earlier in the year.
http://politicalticker.blogs.cnn.com/2013/01/03/boehner-under-fire-...
In spite of strong support among the same House members responsible for the shut down, Cantor kept a low public profile in the shooting match of daily feeds to the press and public announcements through the highest-intensity days of the controversy. Cantor’s quiet role contrasted with a very explicit negotiating demand he had made very publicly just a few weeks ago “to attach legislation to alter renewable fuel standards to a package to raise the U.S. debt ceiling.”
http://www.bloomberg.com/news/2013-09-04/cantor-weighs-tying-debt-c...
Maybe the Virginian’s position was in defense of large poultry producers in the Southeast facing recent high feed costs, but more likely it was on behalf of the American Petroleum Institute. Large oil-refining interests have for many months engaged a high-energy lobbying and public relations campaign to knee-cap ethanol production and release themselves from some RIN mandates.
So Cantor made a showy entrance to the debt-ceiling debate back in September, and faded to the background when the fight became more immediate. The government shut down on October 1, and as far as I know, Cantor did not participate in high-profile any press conference between that date and October 10. Then, after days of near silence from Cantor, on October 10, he showed to a Republican leadership press conference and said, “The good thing is the negotiations are ongoing. That is much more progress than has been the case lately,”
http://www.reuters.com/article/2013/10/11/us-usa-fiscal-idUSBRE98N1...
The ice had been broken, Boehner and Cantor put forward a unified conciliatory front, and Bloomberg news said on that date,
“For the first time, a week-and-a-half into a partial shutdown of the U.S. government…congressional leaders and the White House showed signs of a way out of their standoff.”
A very natural question, and perhaps an important one, is identification of the events which thawed Cantor’s disposition toward negotiating. On the very same day as the above press conference, October 10, in fact just a couple hours before it, Reuters reported that the EPA had worked out “a historic retreat from…2007 law.”
http://www.reuters.com/article/2013/10/10/epa-ethanol-idUSL1N0I0183...
So while government workers at EPA were on furlough, somehow the press received information suggesting that the Obama administration would cave to longstanding Republican and oil-interest demands, after firmly refusing to negotiate on that matter throughout all of both of its terms in office. Furthermore, there were no concrete indications of any other compromises made by the White House.
While the rule change is not policy for now, expectations are that it could lop 500 million corn bushels out of ethanol production, nearly 5% of total demand of US corn for all purposes. It also weakens support for cellulosic ethanol, which folks like the Union of Concerned Scientists say holds significant potential as a breakthrough technology to reduce carbon emissions.
When the rule change was floated, refiners’ stock value popped. Corn prices however did not suffer from their already depressed level. The December contract low coincided with publication of the draft rule change. While there are many other factors in the corn market at the moment, its possible the market “sold the rumor and bought the fact.” Just a week before the leak, Informa Economics issued a report suggesting the change would occur. | |
|
Corn and the Shut Down
