MTBE was used for good reasons.
MTBE has been used as an octane enhancer (helps prevent the engine from "knocking") in gasoline since 1979, after the US phased out lead additives. Since 1992, MTBE has been used at higher concentrations in some gasoline to fulfill the oxygenate requirements set by Congress in the 1990 Clean Air Act Amendments.
Oxygen helps gasoline burn more completely, reducing harmful tailpipe emissions from motor vehicles. In one respect, the oxygen dilutes or displaces gasoline components such as aromatics (e.g., benzene) and sulfur. In another, oxygen optimizes the oxidation during combustion. Most refiners have chosen to use MTBE over other oxygenates primarily for its blending characteristics and for economic reasons, although they may choose to use other oxygenates, such as ethanol.
Oxygenates (primarily MTBE and ethanol) reduce carbon monoxide emissions and volatile organic chemical emissions. At certain levels, MTBE reduces benzene emissions (a known carcinogen.)
Removing tetraethyl lead from gasoline was a good thing. Something had to replace it and MTBE was a reasonable choice at the time. Since MTBE's been banned as a gasoline additive by many states it should become less of a problem over time (though it does take a long time to degrade).
Almost every choice has consequences, some of which might not be seen in advance no matter how obvious they seem in retrospect. As for ethanol, it has significant costs too: The federal government subsidizes agricultural ethanol by [link|http://64.233.161.104/search?q=cache:0hvv90Rxu38J:www.ncenergy.appstate.edu/plan/ch5.pdf&hl=en|54 cents/gallon] (which can be, and is, argued for based on reduced foreign oil demand and less pollution), helping to drive up the deficit and enriching ADM. It also means more farmland is needed, more petrochemical-based fertilizers, more land erosion and water pollution, etc., etc.
TANSTAAFL. :-)
Cheers,
Scott.