The Senate agreed Thursday to do away with an ethanol tax credit, a pivotal sign of waning support for industry subsidies amid mounting concerns over deficit spending and the nation's mounting debt.
The 73-27 vote to advance the proposal drew support from across party lines as farm state senators found little backing for the tax break that government accountants have called duplicative and unnecessary.
Still, ending the ethanol credit is unlikely to happen soon, as the legislation was attached to a stalled economic development bill.
Despite pressure on Republican senators not to allow a tax hike by eliminating the nearly $6-billion annual subsidy, a majority of GOP senators gave their support in yet another signal of their willingness to do away with some tax breaks – a point that has become a critical factor in deficit-reduction talks with the White House.
The end of ethanol subsidies appears to be the price paid to end oil and other energy company subsidies as well. Getting 73 votes in the Senate is no easy task, and the message is clear to all involved. Oh, the Heritage Foundation and other far right outfits are crying foul, saying Republicans are breaking their "no new taxes" pledge by doing this, but the country's overwhelmingly for ending tax breaks for companies who are making billions in profits, and no amount of spin is going to sell that in this economic maelstrom.
Even the Senate can see the writing on the wall here. Of course, this just means the energy companies will have to get their money through some other means, and they will.
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