Energy/Environmental Policies requiring Ethanol cause Hunger and Economic Devastation throughout the World

Posted by PITHOCRATES - August 4th, 2012

Week in Review

As if the Great Recession wasn’t bad enough already.  Bad economic policies and bad regulatory policies have already beaten this economy into the ground.  And now the government is going to pile on with bad energy/environmental policies.  Making the American people say “ouch” (see Corn for Food, Not Fuel by COLIN A. CARTER and HENRY I. MILLER posted 7/30/2012 on The New York Times).

…By suspending renewable-fuel standards that were unwise from the start, the Environmental Protection Agency could divert vast amounts of corn from inefficient ethanol production back into the food chain, where market forces and common sense dictate it should go.

The drought has now parched about 60 percent of the contiguous 48 states. As a result, global food prices are rising steeply. Corn futures prices on the Chicago exchange have risen about 60 percent since mid-June, hitting record levels, and other grains such as wheat and soybeans are also sharply higher. Livestock and dairy product prices will inevitably follow.

More than one-third of our corn crop is used to feed livestock. Another 13 percent is exported, much of it to feed livestock as well. Another 40 percent is used to produce ethanol. The remainder goes toward food and beverage production.

Previous droughts in the Midwest (most recently in 1988) also resulted in higher food prices, but misguided energy policies are magnifying the effects of the current one. Federal renewable-fuel standards require the blending of 13.2 billion gallons of corn ethanol with gasoline this year. This will require 4.7 billion bushels of corn, 40 percent of this year’s crop.

Almost half (40%) of our corn goes to produce ethanol.  That alone has raised the price of our food.  And a lot of our food has corn in it.  Including cows.  As in corn-fed beef.  Dairy cows, too, eat corn.  They give us milk and cheese.  Chickens eat corn.  Providing us with low-fat chicken breasts.  Eggs.  And those delicious Chicken McNuggets our kids love.  Our energy/environmental policies have been increasing the cost of groceries for families.  And the drought is only going to increase them more.  Making it ever harder for the American family to put food on the table.  Especially when a lot of them are struggling to get by on less thanks to an already bad economy.  So why do we use food to fuel our cars?  Because the government has dictated that we do.

The price of corn is a critical variable in the world food equation, and food markets are on edge because American corn supplies are plummeting. The combination of the drought and American ethanol policy will lead in many parts of the world to widespread inflation, more hunger, less food security, slower economic growth and political instability, especially in poor countries…

Any defense of the ethanol policy rests on fallacies, primarily these: that ethanol produced from corn makes the United States less dependent on fossil fuels; that ethanol lowers the price of gasoline; that an increase in the percentage of ethanol blended into gasoline increases the overall supply of gasoline; and that ethanol is environmentally friendly and lowers global carbon dioxide emissions.

The ethanol lobby promotes these claims, and many politicians seem intoxicated by them. Corn is indeed a renewable resource, but it has a far lower yield relative to the energy used to produce it than either biodiesel (such as soybean oil) or ethanol from other plants. Ethanol yields about 30 percent less energy per gallon than gasoline, so mileage drops off significantly. Finally, adding ethanol actually raises the price of blended fuel because it is more expensive to transport and handle than gasoline.

Ethanol isn’t what they say it is.  In fact it makes a pretty poor fuel.  And it will propagate hunger and economic devastation throughout the rest of the world.  Especially in poor countries.  So there is no good reason to use food to fuel our cars.  It would appear the only reason why the government dictates this policy is that the lobbyists make it worth their while to dictate this policy.  Amazing what you can get away with when you veil your special interests in the cloak of environmentalism.  The media and the court of public opinion eviscerate any non-environmental corporation for doing what the ethanol lobby does.  But if you want to make evil profits all you have to do is say ‘global warming’ and no one will fault you for your greed.

Families will have to cut out their visits to McDonalds as these high prices hit pretty much everything on their menu.  Which is an unintended consequence the government may actually like.  For they say our kids are too fat.  But this won’t make our kids happy.  They like their McNuggets.  Which can mean only one thing.  Our government hates kids.

www.PITHOCRATES.com

Share

Tags: , , , , , , , , , , , , ,

Comments are closed.

Blog Home