Your health reform: Powered by biofuels?

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A final batch of amendments to the big House of Representatives health reform bill pokes a few sharp sticks at insurance companies. It also changes the tax law on production of biofuels. Say again? For me, it’s a hallelujah moment–health policy and energy policy in the same bill!  But it’s still completely unrelated to the health bill–or maybe not. Maybe it all comes back to getting the conservative "Blue Dog" Democrats on board.

Many thanks to David Dayen of the website FireDogLake for parsing this out. His long post unravels who would benefit from expanding federal tax credits for cellulosic ethanol fuels to all "second-generation biofuels," like those produced from algae, and eliminating a tax credit that let paper companies game the "cellulosic biofuel" system. It could also save taxpayers $24 billion, which could be applied to cost reduction in the health care bill. It’s sure not elegant, but it’s possibly useful.

As Dayen concludes:

So this looks to me like a way to wring $24B in savings out of the
health care bill, reducing concerns about it busting the deficit and
aiding the CBO score. It also fixes an unintended consequence of previous energy policy.

But we should also ask who benefits. In this case, that would be
recycled paper mills, and the advanced biofuels industry, thanks to
some other pieces in the bill. At first blush, I would guess that
advanced biofuels producers are located in rural areas with lots of
farmland – in other words, the kinds of places that Blue Dogs inhabit.

Opponents of health reform are going to scream bloody murder about sticking an unrelated amendment into the health reform bill, even though it’s a rampant practice in many bills. But if it fixes a loophole, saves a few billion and brings aboard some foot-draggers, it’s all good.

Consumer Watchdog
Consumer Watchdog
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