Asks Kimberly Strassel in her op-ed in today’s Wall Street Journal, “Washington’s Latest Special Favor,” which offers a reality check on the Obama Administration’s professed commitment to “Transparency and Open Government.”
Strassel concisely summarizes the enormous burden imposed on the nation’s 143 refineries by the ethanol mandate administered by the EPA, which this year requires each refinery to mix into gasoline its share of 16.5 billion gallons of ethanol, or else buy “credits” for each gallon not blended. Currently these “credits” cost nearly $1 a gallon, forcing refineries to pay more for “credits” than they pay their workers — hundreds of millions of dollars a year for some refineries, decimating profits.
Except for one refinery, which somehow managed to win an exemption, thus supplying “a glimpse at the secret, special-favors factory that Washington has become under President Obama,” Strassel notes. Of particular interest is the effort being made by the Obama Administration to hide which refinery received the exemption — and how and exactly why it was granted. She continues:
[A]n exemption from today’s mandate is far more than a perk — it is a lifeline, an outright payday. Making this indulgence even more curious is that it is being issued by the Obama EPA, an agency that isn’t exactly known for doing favors for beastly carbon producers.
So who is the lucky dog? Who could make this happen? That’s the best part. The EPA won’t say. The agency not only refused to name the refinery in its rule, but also obscured certain numbers in the document to hide the beneficiary’s identity. An EPA press officer would not give me the name, citing “confidentiality restrictions.”
. . . The EPA rule this week said this exemption had been granted under EPA’s authority to evaluate refineries on a “case by case” basis. The press officer said DOE was involved in the evaluation.
What was the actual process? It’s a worthy question, given that the refinery sector is no stranger to politics. As hard times have hit, politicians have become deeply involved in protecting their home-state refineries. Many are unionized, which raises the question of whether Big Labor engaged in an exemption request.
Dozens of small refineries are being crushed by the mandate, and a number have petitioned the EPA for exemptions. If “disproportionate economic hardship” is the agency’s standard, no doubt plenty would qualify. Yet only one got the nod. The rest of the industry is dying to know what is so special about this refinery, especially since the EPA is making every other refinery shoulder its burden.
The public should want to know too. Washington is rife with secret deals that reward select corporate players, and the numbers have only accelerated under this “most transparent” of administrations. If the process by which the EPA issued this exemption was aboveboard, it should have no problem divulging details. Until that time, the public might fairly assume funny business.
Related thoughts from Richard Epstein here.