Congress and the ethanol lobby argue that if some outcome would be politically nice, it should be mandated (details to follow). Then a new round of market interventions is necessary to fix the economic harm resulting from the previous requirements, while creating more damage in the process. Ethanol is one of the most shameless energy rackets going, in a field with no shortage of competitors.The problems associated with this bit of legislation ought to be a cautionary tale for anyone who wants to perform a little market manipulation to achieve their preferred policy goals. The best government intervention, if indeed, any is required, should be, as Dr. Pope always taught, "simple & targeted."
If you can't guarantee that the legislative process end result will be both of those things, it's best that you just leave the market to its own devices.
If you have tips, questions, comments or suggestions, email me at firstname.lastname@example.org.