I was asked a few posts ago if Mr. Trump could do anything right economically that we’d agree with.  Well, Mr. Trump continues to make it hard, because he constantly proves the point he’s in favor of business, not markets in general.  Going into election 2018, Mr. Trump feels the need to help protect Republican members of congress from the wrath of voters upset at the impact of his tariffs on agricultural prices.  So he is lifting a ban on selling government subsidized E15 gasoline (gasoline that can contain up to 15% ethanol) during summer months.  There are a whole host of environmental reasons to be against ethanol, and its true that even Al Gore no longer supports it:

“First generation ethanol I think was a mistake. The energy conversion ratios are at best very small. “It’s hard once such a program is put in place to deal with the lobbies that keep it going.” He explained his own support for the original program on his presidential ambitions. “One of the reasons I made that mistake is that I paid particular attention to the farmers in my home state of Tennessee, and I had a certain fondness for the farmers in the state of Iowa because I was about to run for president.”

Note the emphasis added to Mr. Gore’s quote.  Like Mr. Obama, Mr. Trump is quite content at picking winners and losers in the energy economy.   And like Mr. Obama, Mr. Trump is not terribly concerned about the consumers and taxpayers that will suffer because of his cronyist policies.  So once again, Mr. Trump, I’d like you to meet Mr. Obama–you two have quite a lot in common.  But I’m not sure how well you’ll get along.

Are we all crony capitalists now?

PS:  you can put your ethanol horror stories in the comments below.  I’ll start.  While I haven’t found any official data, most internet complaints say it costs about 10% in fuel economy because of the lower energy content of ethanol.  As this Road & Track article suggests, that is likely high–you’ve got to get something out of the energy that’s getting burned, but it certainly shows why people don’t go with E85 generally–what you save through the subsidy is eaten up by poorer mileage.