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DAVID KRUSE

By Staff | Jun 24, 2010

President Obama says that he talks with Gulf fishermen and oil spill experts so that, ”I know whose ass to kick.” The President is more of a hugger than a kicker so this sort of thing doesn’t come natural to him. He should know whose ass to kick without having to ask.

BP thinks this is just another expensive public relations challenge for them to overcome like broken Alaskan pipelines and refinery infernos, intending to pay dividends and hiring extra public relations consultants like normal. The fact the President used the word ”ass” instead of more benign terms like rear-end or derriere was meant to exude earthy seriousness so he is competing with BP in the public relations contest.

Somebody should tell BP’s CEO Tony Hayward, who recently lamented publically that he would like his life back, that ”This is your life!” Oil plumes miles long below the surface, initially denied to exist by BP have been confirmed. Use of those dispersants may have not been such a good idea. Now instead of one slick, they have hundreds of thousands of little ones impeding containment and gathering. The plumes will kill a lot of Gulf sealife. How does BP pay for that?

I don’t think agriculture will have to defend itself against false charges over a Gulf dead zone, maybe forever, as BP deserves all the credit for that now.

President Obama has been kissing up to Congress instead of kicking their ass. Things like their failure to extend the $1/gallon biodiesel tax credit is as incompetent and dysfunctional as anything BP has done, resulting in the biodiesel industry shutting down, costing thousands of jobs. Something very similar is going to happen next to the ethanol industry if they don’t dramatically change gears in Congress and the White House.

They fail miserably at turning rhetoric into action while implementing policy. There was no formidable opposition to extending the biodiesel tax credit when it expired at last year’s end. Congress just couldn’t get it done.

The politics driving the extension of the biodiesel tax credit is on-off, on-off. It was turned off again in the Senate. They will keep trying to turn it on, but for all practical purposes, it’s too late to fix the damage they have done to the industry with a single year, 2010, retroactive tax credit extension.

Biodiesel producer’s bankers/creditors would take this year’s check for the tax credit and plants will remain idle until the tax credit authorization is extended long enough to make starting plants again plausible.

We have every reason to believe that the ethanol blender’s credit and tariff will meet a similar fate. The result would be a retrenchment in the ethanol industry, lower corn prices, plenty of supply for China and increased need to drill more deep water oil wells in the Gulf. Energy Secretary Chu is no fan of ethanol, at least not the practical kinds. U.S. Ag Secretary Tom Vilsack obviously doesn’t have the President’s ear on the subject. Our ag secretary doesn’t have a Nobel Prize like Chu.

As President Obama is asking for advice on whose ass to kick, here is mine:

”Dear Mr. President:

If you are looking for asses to kick, how about the EPA’s?” The EPA is reportedly testing E-15 in older vehicles. Brazil burns E-23. Opposition to raising the blend cap to E-15 in the U.S. is politically contrived, special interest driven, made up excuses.

The EPA is dithering. While it should step up to E-15 immediately, it could adopt a bureaucracy placating half measure allowing E-12. That’s the kind of thing they do when they don’t have the balls to do the right thing. Mr. President, you called the oil spill in the gulf an attack on U.S. shores. When Franklin Roosevelt wanted Tokyo bombed after Pearl Harbor, Doolittle did it.

President Obama, you don’t appear to know how to give those kind of orders and your administration doesn’t know how to carry them out. Worry about being perceived as too low key, calm and aloof prompted your ass-kicking comment. Saying it and doing it are two different things.

Telling the EPA to raise the ethanol cap to E-15 and ordering an immediate permanent extension of all biofuel tax credits would be kicking ass, Mr. President. When you start kicking, we’ll take names.

Be sure to tell EPA not to adopt some half measure like limiting approval of E-15 to older vehicles because half measures don’t work in the real world. Retailers are not going to dedicate pumps to this fuel and that fuel, and confuse customers creating liability.

The way it is right now, Mr. President, is that you are kicking the biofuel industry when it is down, jobs out the window, worsening U.S. energy dependence on foreign oil, while putting more future reliance on BP to ”drill, baby drill,” not less.

You didn’t even mention biofuels in your address to the nation. Nobody, Mr. President, thinks that you have any ass-kicking ability beyond taxing people who make more than $250,000 annually in you.

Please prove them wrong.”

David Kruse is president of CommStock Investments Inc., author and producer of The CommStock Report, an ag commentary and market analysis available daily by radio and by subscription on DTN/FarmDayta and the Internet.

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