Big Ethanol’s War on Ted Cruz

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Iowa Freedom Summit Features GOP Presidential  Hopefuls
Iowa governor Terry Branstad and his ethanol-lobbyist son have their sights on caucus front-runner Ted Cruz.Photo: Scott Olson/2015 Getty Images

In June 1999, George W. Bush launched his presidential campaign in Iowa, making it clear the very first day that, despite his background in oil-dependent Texas, he favored government subsidies for ethanol, the corn-based alternative fuel that is typically mixed with gasoline. This gave him a big advantage over his principal primary opponent, John McCain, whose outspoken opposition to ethanol subsidies led him to skip Iowa entirely (McCain softened his position a bit in 2008, but still placed his campaign’s emphasis elsewhere).

Four cycles later, another Texan is campaigning heavily in Iowa, and his anti-corporate-cronyism bona fides are too important to his image to allow him to make an exception for the ethanol industry (which no longer receives tax subsidies, but does enormously benefit from a federal fuel standard that mandates ethanol use). As he has surged into a close competition with Donald Trump for first place in the caucuses, the ethanol lobby, egged on by Cruz’s rivals, has begun to dog his every step. And not coincidentally, Iowa’s Republican "governor for life" (he’s now in his sixth nonconsecutive term) Terry Branstad, whose son happens to run the chief ethanol-industry advocacy group, America’s Renewable Future, has abandoned his neutrality in the presidential race to call for Cruz’s defeat based solely on the perceived threat he represents to ethanol. 

While Branstad the Elder describes Cruz as a shill for “big oil,” his formal position is one of opposition to energy subsidies of all kinds. And downshifting for the presidential race, Cruz modified his earlier support for an immediate end to the ethanol mandate to now favor a phaseout. He’s also tried to emphasize his opposition to EPA limits on the percentage of ethanol in gasoline. But the way it’s all coming across is that the Iowa caucuses will be a test of strength between King Corn and the first viable presidential candidate willing to disrespect the king in his castle. 

Unsurprisingly, Donald J. Trump, unburdened by conservative economic orthodoxy, is siding wholeheartedly with the ethanol people and taking every opportunity to contrast his position to Cruz’s. 

Governor Branstad’s motives may transcend Iowa chauvinism and parental interest in his son’s political project. He is rumored to be a silent supporter of Chris Christie, who has his own base of wealthy agribusiness supporters in Iowa and who has recently been spending time there with the alleged goal of beating Jeb Bush and perhaps squeezing him out of the race before the real deal among “Establishment” candidates goes down in New Hampshire.

So there’s a lot going on here, and between the ethanol issue and the Trump-inspired “birther” pseudo-controversy, the recent perception that Cruz might run away with the caucuses is dissipating. Yeah, he’s got a lot of Christian-right endorsements, and on Trump’s favorite issue Cruz’s flanks are being protected by arch-nativist Steve King. But becoming the perceived cause of a statewide fretfest over the future of ethanol is not a good closing strategy for Iowa.