This Tuesday the Environmental Protection Agency (EPA) held a hearing concerning whether or not to increase the amount of ethanol in our gasoline. I testified in opposition of this proposal and here’s why: the unintended consequences of this policy are hurting African American families and other disadvantaged American groups.
As the President of Reaching America, an organization developed to address complex social issues impacting the African American community, my team and I work to find solutions to help businesses create jobs, reform occupational licensing, improve our education system, create a more fair criminal justice system, and other important topics.
For more than a decade Americans have been filling their gas tanks with a blend of approximately 90 percent gasoline and 10 percent ethanol. We were told it was better for the environment than using 100 percent gas. That it would make gasoline cheaper, cleaner, and make the United States more energy independent.
Unfortunately those promises have fallen short, and it is working Americans—particularly those in low-income and minority communities—who are paying for it.
Right now millions of families are living in what is known as energy poverty. This means they struggle to keep the lights on, and their houses heated in the winter and cooled in the summer. Often times having to make tough choices like whether to eat today or pay their electric bill.Poverty, particularly energy poverty, is one of the complex social issues where Reaching America is working to find solutions.
When the government creates policy, its first priority should be the welfare of the people, especially those impacted the hardest, rather than big businesses and special interests looking for a handout.
Here is the bottom line: any policy that contributes to energy poverty is a bad one for low-income families and minority communities.
Requiring an additional amount of ethanol to be put in gasoline will damage the engines of older cars and small-engine tools like lawnmowers, and require drastic maintenance costs—costs many black families simply can’t afford.
But that’s only the first unintended consequence.
Secondly, the diversion of corn to create ethanol makes makes food more expensive. In 2000, 90 percent of corn farmed in the United states went to feeding people and livestock. As of 2011, that number was only 60 percent, with the remaining 40 percent going to make ethanol.
This government-mandated boom in demand for corn to create ethanol has driven up the cost of corn. Researchers at the University of California-Davis and Berkeley found that corn prices in 2012 were 40 percent higher than they would have been without the mandate.
That price increase means every other food product that uses corn as an input including everything from corn flakes to your favorite french fries —including corn-fed livestock and food containing corn-derived ingredients—is now more expensive than ever.
Lastly, these increased costs also make it more difficult for companies to hire new employees or pay their current employees more.
Unemployment, including black unemployment, has finally reached pre-recession levels. Why should we take a huge step backward by making everyday life more expensive?
Black employment often lags behind that of other groups, so policies that increase unemployment in the population as a whole are going to disproportionately hurt blacks, low-income families, and other minority groups even more.
Where does all of this leave working families?
Mandates like the one proposed by the EPA put limits on American ingenuity and industry, and are a great way to cut the bottom rungs off of the economic ladder.
Derrick Hollie is President of Reaching America, a 501(c)(4) organization developed to address complex social issues impacting African American communities today. These issues include Energy Poverty, Justice Reform, Occupational Licensing and Free Speech.