In Iowa, Cruz Confronts Politics of Ethanol

STORM LAKE, Iowa — Ted Cruz says his position on ethanol hasn't really changed, but he's certainly explaining it a lot more lately.

As he crisscrosses Iowa as the frontrunner for its caucuses, the Texas senator and Republican presidential candidate is working to neutralize whatever disadvantage might spring from his opposition to the federal Renewable Fuel Standard, which sets the minimum amount of ethanol blended into the U.S. gasoline supply. The measure, popular in corn-growing Iowa, has long been a sensitive issue among presidential candidates hoping to win the support of farmers in the first-in-the-country caucus state.

Cruz has been unapologetic in his stance against the standard, claiming it amounts to the federal government "picking winners and losers." But he insists he's not singling out ethanol, promising to eliminate all energy subsidies and mandates if elected. 

Cruz has been sparring for weeks with America's Renewable Future, a pro-ethanol group that is spending hundreds of thousands of dollars to warn Iowans about Cruz's opposition. The group is stalking Cruz as he treks across the state this week, parking an RV outside his events and handing out mailers that call Cruz "dangerous" for Iowa farmers.

In an op-ed published Wednesday afternoon by the state's largest newspaper, Cruz dismissed the idea that he is anti-ethanol. 

"By this point in the campaign, many readers will have seen the furious coordinated effort being waged by Democrats and big-money lobbyists, who are together spending hundreds of thousands of dollars trying to convince Iowans that I oppose ethanol," Cruz wrote in the Des Moines Register. "Their charges are utter nonsense."

The op-ed echoed points Cruz has been making as he completes a six-day, 28-county bus tour of Iowa. He has suggested America's Renewable Future is trying to "snooker" Iowans into believing the standard is the only way for ethanol to survive, all part of an effort to reinforce farmers' dependence on the federal government. 

The economic stakes are not insignificant. Combined with biodiesel, ethanol spurred more than 46,700 jobs in 2014 and contributed to roughly 3.5 percent of the state's GDP, according to the Iowa Renewable Fuels Association. 

On Wednesday afternoon, the group claimed it was making progress in swaying Cruz, citing remarks he made a day earlier saying he supports phasing out the standard by 2022, the year the program is already set to expire, not eliminating it immediately. 

"He is clearly listening to the people of Iowa and understands the importance of the Renewable Fuel Standard to America’s economy and energy independence, as he started the caucus process calling for immediate repeal," America's Renewable Future state director Eric Branstad said in a statement. "While not perfect, this is a big step forward by Sen. Cruz." 

Later Wednesday, Cruz's campaign fired back at the suggestion that he had shifted on the issue. Calling the claims "false accusations," the campaign issued a news release saying Cruz "has consistently supported a five-year phase out of the Renewable Fuel Standard." 

"I have said exactly that — that we should phase out the RFS," Cruz told reporters before a stop Wednesday evening in Spencer. "I know this is a shocking proposition for you — that a group of lobbyists and Democrats who oppose me may actually say something that is not true."

America's Renewable Future is not the only player in the 2016 race scrutinizing Cruz's ethanol position. The campaign of one of Cruz's GOP rivals, U.S. Sen. Marco Rubio, said in an email to reporters Wednesday afternoon that Cruz's remarks Tuesday in Cherokee represented "another day, another flip-flop for Ted Cruz." 

In 2014, Cruz introduced legislation that would have phased out the standard by the end of a five-period following its enactment. Because the bill is unlikely to become law under President Barack Obama, Cruz's campaign sees a realistic effective date of 2022, five years after he would take office if elected. 

It has not been lost on Cruz's critics, however, that he once pushed a more drastic approach. In 2013, he co-sponsored legislation to immediately repeal the standard. 

Hanging over the debate is the question of just how much ethanol matters to caucus goers. Tim Hagle, a political science professor at the University of Iowa, said the ethanol standard has faded as a voting issue in recent years, especially in contrast to 2000, when Republican U.S. Sen. John McCain's ethanol opposition was seen as the reason he did not compete in Iowa.

"That's kind of far down the list" of issues that motivate caucus goers nowadays, Hagle said. "It’s no longer as important as an issue as it has been in the past, but if you happen to work in that industry and it’s your issue, then of course it affects Cruz’s appeal to you."

Iowa GOP Chairman Jeff Kaufmann responded diplomatically Wednesday morning when asked if Cruz's ethanol position could hurt his chances in the caucuses. 

"Ethanol is a critical issue for Iowans," Kaufmann told a questioner in an online chat on the website Sidewire. "Ted Cruz is a fantastic candidate and we're excited to have him working so hard to earn Iowan's votes."

As he worked his way across northwest Iowa on Wednesday, Cruz fielded questions about ethanol from the audience roughly a half-dozen times. In most instances, the reception his answers garnered was far more positive than it was negative, especially when he spoke of creating a "level playing field" for the energy producers.

Still, some of the Iowans who questioned Cruz appeared to be seeking more information. "People are saying you're flip-flopping," a man told Cruz on Wednesday night in Storm Lake, citing something he read online just an hour earlier.

On Tuesday afternoon in Cherokee, Cruz encountered his first skeptical questioner in Julie French, a woman from Meriden who said she and her husband have significant investments in ethanol plants. Cruz reassured her he would not "jerk the rug out" — her words — from the industry by phasing out the standard over five years, not immediately.

Speaking with reporters after questioning Cruz, French expressed lingering unease with scrapping the standard at any rate, suggesting it would embolden oil companies. Despite her concerns, she acknowledged ethanol may not be a priority for most caucus goers.

"When you look at all the problems in the world, the Renewable Fuel Standard is way down on that line," French told reporters.

Not every Iowan who asked Cruz about ethanol was dissatisfied with his response. At a stop Tuesday morning in Onawa, local grain farmer Ken Carlson walked away from an exchange from Cruz satisfied with the senator's promise to get ret rid of all energy subsidies, not just those for the ethanol industry. 

"That's one of my big gripes — the picking and choosing by the government, who's going to succeed and not going to succeed based on their subsidies," Carlson said. "There's no doubt that we will feel the impact of a subsidy being taken away, but everyone will and we'll just have to adapt."