Posted on 05/03/2008 5:23:49 AM PDT by kellynla
With food shortages emerging in many parts of the developing world, it's time to ask which we put more value on, human life or an extra car in the garage? Because whether we want to admit it or not, the two have become intricately intertwined.
The biofuel industry came to Saint John a few weeks ago. The occasion was the Atlantic BIOEnergy Conference and the industry leaders made all the right noises: Biofuels are good. They are environmentally-friendly. Atlantic Canada can become a leader in biofuel production, if only the government helps it along with a bit of money (although that appeal could apply to virtually any industry).
At the same time, ironically, the international pages were awash with stories of food riots, exploding prices and export bans on staples by developing nations trying to look after their citizens. Psychiatrists have a phrase for this phenomenon; they call it "cognitive dissonance."
The competition between food and fuel is a relatively new phenomenon, largely for two reasons. For the latter half of the twentieth-century energy, especially, petroleum was relatively inexpensive. Despite the odd spike in energy prices, gasoline and other fuels generally offered the best value for consumers. Petroleum was both plentiful and very adaptable, as one could run automobiles, heat homes or fuel power plants all from the same barrel of oil. Food (by contrast) was expensive and not very adaptable for uses other than for human or animal consumption. (The energy content in a litre of corn-based ethanol is only 70 per cent of the energy content in a litre of gasoline). As the economists say, they were imperfect substitutes, despite the efforts of engineering students (and some environmentalists) to run their cars using vegetable oil.
So what suddenly made biofuels the most attractive fuel source since the days of Moby Dick? In a word, "government."
It should come to no surprise that governments often look for the easiest solution to whatever issue confronts them. When inflation was a problem, we got wage-and-price controls. When doctors' salaries began escalating in the early 1990s, they cut positions at medical schools. When test scores fell in schools, we lost early immersion. The solutions that governments choose are not always the right ones (some would argue they are never the right ones) but they satisfy the immediate problem, even if they create bigger dangers in the long run.
Biofuel production, especially for vehicles, only took off in earnest in the 1980s when prices for Brazilian sugar collapsed. Faced with collapsing farm incomes and rising prices for imported oil, governments in Brazil embarked on a massive program (with massive subsidies) to convert sugar into ethanol for motor fuels. The project was very successful and by the late 1980s 90 per cent of all cars built in Brazil were designed to burn ethanol.
Ethanol production travelled north for similar reasons. In the 1990s, the U.S. government (which had long subsidized corn production) began subsidizing the production of corn-based ethanol for use as a partial substitute for gasoline. This policy was further aided by high import duties on ethanol from Brazil which, as it's made from sugar cane, is cheaper and highly valued. However, by the time 2007 rolled around, what had once been a farm-income support plan to find a use for excess corn had evolved into a program of mandates to produce ever larger quantities of ethanol as a fuel for automobiles. Corn prices have doubled in three years and next year ethanol production will consume one-third of the U.S corn crop. For industries that require corn as a feedstock (everyone from ranchers, through soda companies, to tortilla makers), rising corn prices mean higher prices for their outputs.
Governments (in Canada and Europe) have begun mandating biofuels as part of national fuel standards in order to reduce greenhouse gas emissions. This has proved a fool's errand, as the Canadian government's own scientists report that corn-based ethanol is not effective in reducing greenhouse gases versus gasoline (although it does help combat pollutants that produce smog).
Despite this, governments across Canada are jumping on the ethanol bandwagon in order to be seen to be doing something (anything) to combat global warming. Canadians will soon have a patchwork of regulations mandating biofuels from sea to sea to sea.
In recent weeks, many commentators have said that the recent spike in food prices (grains up between 40 per cent and 130 per cent in the last year) is the result of a "perfect storm" of high energy prices, regional droughts and food being diverted to biofuels. It is, in fact, a perfectly predictable storm brought on by the desire of citizens of developed nations to keep on driving in spite of rising petroleum costs.
Governments have been complicit in this effort, offering the opportunity to do good by replacing gasoline with ethanol, and subsidizing the effort so we don't know the real cost.
It's a Faustian bargain and its time we stopped. Happy farmers are one thing, starving children another. It's time to get off the biofuel carousel, before more damage is done.
ping
Biofuels: No Blood For Oil!
(But starvation is ok.)
Ending the corn ethanol nonsense seems to generate consensus across the political spectrum. But don’t expect action anytime soon. Too many well-connected political interests spent years pushing this boondoggle, and they won’t let it go without a big fight.
I just e-mailed my Rep. last night to lead or support stopping the Ethanol mandate.
A Perfect Storm of Stupidity ~ al bore & the lib/dems!!!!
Don't give Bush and the GOP Congresscritters a pass on this one. An agenda this stupid usually requires bipartisanship.
This is a non starter, baby. The second sentence was even worse. Can't imagine why it takes so much text to repeat the talking points.
Agree. Many Republicans pushed this silly agenda too.
True enough, as far as it goes.
If the US had spent the same effort on drilling known reserves and recovering tar sands as we have ethanol, we would be much better off. The article fails to broach this subject.
And on another front, the article mentions fuel from cooking oil (biodiesel) as if it were part of the problem. This is a relatively small movement and not using food stock to make fuel. Leave that out of this.
That sounds very much like the entire man made global warming scam.
Time and again it is proven that free markets are the most efficient must of the time most humane means for making economic decisions. In fortunately, free markets have to compete with class baiting politicians and pseudo intellectuals.
But that doesn't do anything to win the farm belt vote, does it?
IDIOCY.....burning FOOD for Fuel!!! God will get us for this.
I bet it never dawns on 80% of the country that a lot of our problems come from politicians actually carrying out their constituent’s flawed desires. It always feels much better to blame congress than ourselves.
* Cease all ethanol production. It requires more energy to make than it yields and the unintended consequence is higher food costs. Corn production shifted from feed-corn to subsidized corn for ethanol. Just say "no" to ethanol!
* Immediately create only ONE "blend" of gasoline and cease regional blends which are stupid, costly, and meaningless. Even if this is the "cleanest" blend, just make it ONE and be done with it. Trucking custom blends around the country is wasteful.
* Drill for oil in Alaska, Gulf of Mexico, and other sites in the CONUS as a matter of national security.
* Construct state-of-the-art refineries and/or retrofit current and dormant ones and crank up production.
* Make all “carbon credit” scams unlawful.
* Construct SEVERAL, regional Pebble-Bed Reactors (or other similar designs) that are not considered "breeders", are rechargeable, and cleaner than any current nuclear generator design.
* Use the residual heat from the reactor above to process motor fuel from coal and/or shale. Even though Clinton "stole" some of the best coal reserves, we still have a lot to use.
* Have Iraq pay for its freedom, and maybe even pay us back for their freedom. We'll still need their oil.
* Bust up the cartels or at least be independent enough to make the cartels inconsequential.
* Convince local taxing bodies to lift or fix the sales tax on gasoline so that as gas prices go up, the local tax collectors don’t see a windfall revenue jump at the expense of the consumer.
Just a comment that this folktale is not worth further comment.
Converting coal to oil is profitable when oil prices are higher than $40/barrel. (That’s the break-even point for the process.)
With oil at $120/barrel, we still aren’t seeing much in the way of coal-to-oil.
That begs the question... Why? With today’s prices, it would be VERY profitable.
I would venture that all the money being thrown by the government at corn-based ethanol is a barrier to entry for private capital into coal-to-diesel. It's one thing to compete against the market. It's another to compete against an industry favored by Washington.
Spelled A-r-c-h-e-r D-a-n-i-e-l-s M-i-d-l-a-n-d
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