(H/Ts – Charlie and Dennis York as I try to catch up on the news of the week)
Shortly after his Department of Agriculture, Trade and Consumer Protection threatened to apply Wisconsin’s gasoline Minimum Markup Law (the one that mandates a station charge the higher of 9.18% above the average terminal price or 6% above what the station paid) to a chain of stations selling E-85 gasoline, Gov. Jim “Craps” Doyle (WEAC/Potawatomi-For Sale) ordered that the state no longer harass those selling corn-a-hole-blended fuels (which appears to apply to both E-85 and E-10). A few random observations:
From the original Duluth News Tribune story via Charlie:
Wisconsin Consumer Protection investigators launched a probe into Badger’s fuel prices and found E-85 selling for just over $2 a gallon.
Based on a formula, the investigators said the price should have been $1 more.
Surprise, surprise, surprise. Isn’t that what I’ve been saying for a while? CBOT no longer provides live quotes for corn-a-hole online (gee, I wonder if I had something to do with that :-) , but their latest weekly chartbook (as of the close of business last Wednesday) had ethanol futures settling above $2.50/gallon through the October contracts. By comparison, gasoline futures settled yesterday under $2/gallon on NYMEX, while reformulated gas (the more-plentiful East Coast version at least) futures settled just over $2/gallon (depending on the month, $.04-$.12/gallon over the good stuff).
From Craps’ press release (linked above):
The minimum markup law, passed in the 1930s, sets a minimum price at which motor fuels can be sold in Wisconsin, but makes no distinction between fuel derived from petroleum and fuel derived from ethanol. Governor Doyle said this has the effect of artificially inflating the cost of ethanol blended fuels such as E-85 and E-10. Ethanol is selling wholesale at $1.37 a gallon (accounting for a federal ethanol tax credit), while the price of petroleum is $2.60.
Like Dennis, I have a few questions:
- How much more of a tax break is Big Corn-A-Hole (i.e. ADM) getting than Big Oil? Hint, Big Corn-A-Hole gets better than a 50% tax break.
- Why did the Legislature in the 1930s and governors up until The Bought-And-Paid-For One not make a distinction between corn-a-hole fuel and petrol? Could it be that until Craps came along, Big Corn-A-Hole couldn’t find somebody who could be bought so easily?
- How much would it cost me to have the speed limit raised to, say 110, so it doesn’t take me 5 1/2 hours to get from Superior to Milwaukee?
Of course, what else should I expect from the guy who threatened Big Oil if they ever passed on the true costs of reformulated gas (which then and now contains corn-a-hole) to only those who are forced to buy it? Should I have expected any different from the guy who felt the state Constitution didn’t apply to him when it came time to pay off the Potawatomi and the Ho-Chunk (who bought the biggest position change from him)?
