By Bill Kovarik
Remember all the cute news items two years ago about how the price of movie popcorn just went up $2 thanks to ethanol, or how your grocery cart (or your wallet) just got lighter, thanks to ethanol? Turns out, it was mostly fiction.
We knew that the Grocery Manufacturer’s Association was spending millions on a campaign to discredit ethanol.
Now comes a report from the British government saying that ethanol had only a minor role in the food price increases of 2008. Drought and higher OIL prices were mostly to blame.
The American Council for Ethanol said:
“The role of corn and ethanol in grocery prices has been grossly exaggerated by critics who have much to gain in keeping ethanol’s potential limited… Energy prices have a much more dramatic impact on food prices because all foods are dependent upon this expensive energy for processing, packaging, and transportation…”
Every now and then, you can glimpse major industries like those marketing petroleum and groceries, behaving defensively, and sometimes ruthlessly, to protect markets they are trying to dominate. This dog-eat-dog approach, consumers and national security be damned, is one reason why we have government regulation. It’s because these industries can’t be trusted to regulate themselves.
Ethanol has its problems, but the GMA’s attempt to destroy the ethanol industry on behalf of its friends in the oil industry was unreasoned and reckless.
And now we know it was not based on evidence.
When 25% of the edible grain production is diverted for inefficient fule use then that increase in demand generates a proportional increase in price. People starve because they can’t afford ANY increase in grain prices.
The use of edible grain for fuel is immoral. I don’t care how you rationalise it.
First of all, 25% of edible grain has never been diverted to making ethanol. The corn that is used to make ethanol is “field corn” which is not the corn that is used in food. The by-products form making ethanol go to many local farmers as high grade feed for cattle and other animals.
Second, the American Farmers are on using 30% of the available farmland in America. The biggest problem farmers are having is being able to keep the farms in the family due to the totally screwed up tax system we have in this country.
As it turns out, 80% of American feed grain goes to livestock. Ethanol is made from starch in that grain. The leftover distillers grains have all the protein they did going into the process, and that’s fed to livestock. In effect, the industry intercepts an unused sidestream of corn starch. Now this isnt the world’s most efficient way to create energy, by any means, but I don’t think there’s a moral issue here. I agree with your yardstick — We can’t take food away from hungry people. And I agree that there’s a long term danger. Lester Brown has done a world of good trying to point that out. But I don’t agree that the current corn ethanol industry is doing that.