cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Senior Advisor

Help for ethanol producers in Congress's next pandemic assistance bill.

https://www.agriculture.com/markets/newswire/the-worst-may-be-behind-us-us-ethanol-industry-says-inc...

The bill, introduced by House Democrats, would reimburse producers that suffered unexpected market losses because of the pandemic from Jan. 1 through May 1.

By "producers" I assume it means "ethanol producers".  Now that it looks like ethanol consumption might be inching back up toward previous levels it's important to prevent the loss of any capacity through permanent closures.

0 Kudos
3 Replies
Highlighted
Senior Advisor

Re: Help for ethanol producers in Congress's next pandemic assistance bill.

Just for the record, and it applies to many things that are being rushed through.

As a condition of the aid they should be required to suspend dividends for a couple of years, prohibit executive bonuses etc. 

0 Kudos
Highlighted
Honored Advisor

Re: Help for ethanol producers in Congress's next pandemic assistance bill.

Why ???

Typical federal "strings attached" thought.

Aren't dividends based on an investment ???  So don't pay the mortgage because those evil banks are rich?  Or just to penalize those who can invest???

If the virus was caused by an investor mistake or a CEO abuse?  But it wasn't....

The problem with congress sticking its lipstick where it shouldn't.... they always want to take a political jab at somebody.  Always need to "express" authority over someone.   Cant just do their job in service to their citizens.....

Highlighted
Senior Advisor

Re: Help for ethanol producers in Congress's next pandemic assistance bill.

It is a matter of the moral hazard entailed.

The cost squeeze problem in commodity crop agriculture is just one big moral hazard. Everybody knows that the gubmint always intervenes with the next socialist program so they behave rationally and keep the pedal to the metal.

A bit less clear in this case than, say, airlines or others that blew through their cash on buybacks and executive bonuses and then want a bailout, but still a reasonable principle. If you don't want the cash with the strings then nobody is making you take it.

0 Kudos