Forget corn farmers; kill ethanol's subsidies

Everything matters: when some people "forget" to acknowledge the most basic data on the subject (such as the exorbitant subsidies given to the oil companies), it means they are biased by some kind of personal interest.

Forgive them but DON'T forget that there is people out there ready to lie and cheat, only to defend big oil corporations.

When we look at food prices, we need to think that the 80% of what we pay at the retail shops goes into processing, transporting and storing food: only the 20% of the price goes back to the farmers to cover their food production costs.
So if oil price goes up, it is quite obvious that (in a percent) food prices will go up much more than that, since conventional farming is so much dependent on farming machines and the vast majority of them still runs on fossil fuels. Thus we cannot accuse biofuels for food prices increment!

Though, it is quite obvious that biofuels will have a very positive effect stabilising food price: as soon as they will be more widely used by farmers!

I won't concede, though, to the claim that ethanol causes green-house gas emission to go up. There need to be further studies done before that claim can be accepted.

The studies that resulted in the Time magazine front page article are deeply flawed. Both studies were based on assumptions that simply are not truthful. Yet dozens of media outlets have picked those studies up and promoted them as though they were gold-ribbon un-biased fact.

For one, corn based ethanol is limited by the legislation establishing the RFS at 15 billion gallons. That level can and will be reached easily by corn production within the United States. In fact, by 2015, the year this requirement is reached, we will still be dealing with corn over-production if we continue to follow trend-line corn yields as projected by seed companies and proven by recent history. This means we will provide all of our industrial markets, livestock markets, export markets, and food markets with corn and still have excess production. The Time article was assuming 36 billion gallons of corn ethanol, a ridiculous assumption.

Secondly, the Carbon Dioxide assumptions were based on additional acre for acre destruction of Amazon Rain Forest. A little research will demonstrate that Amazon Rain Forest destruction occurs because of illegal timber harvest followed by illegal cattle ranching. Rain forest destruction is on the decline, reaching a 20 year low in 2007, the same year US ethanol production peaked. Furthermore, Brazilian farmers will not bother to destroy rain forest whenever they can plant Cerrado in row crops for about 1/5 what it costs to clear forest. Brazil has enough untouched Cerrado remaining to double the entire farmed acreage of the United States.

It is a proven and easily demonstrated fact that air pollution and CO2 emmission is drastically improved whenver 10% ethanol blends replace pure gasoline. You need only look at the experience of St. Louis, Chicago, and other major cities.

We need an answer to the oil industry, but corn-based ethanol doesn't seem to be it.

Almost all biofuels used today -- including corn-based ethanol -- cause more greenhouse gas emissions than conventional fuels if the full emissions costs of producing these “green” fuels are taken into account.

I'm all for pursuing energy alternatives, and ending oil subsidies, but pouring our tax dollars into the ethanol industry seems to be making the problems we seek to address worse, not better. That, to me, is a questionable use of our tax dollars, because we, the taxpayers, aren't seeing the benefit from our tax dollars.

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/26/AR2008022602827.html

http://www.nytimes.com/2008/02/08/science/earth/08wbiofuels.html

http://www.startribune.com/local/15403981.html

You can't seperate ethanol from the oil industry. Ethanol does not exist in a vacuum. Until hydrogen, it is either ethanol or oil products.

Some people criticize ethanol for using 3 gallons of water per gallon of ethanol production. OK, but what about the fact that gasoline requires 70-80 gallons of water.

Yes ethanol is subsidized, but so is gasoline. You can't expect ethanol to stand on it's own unless you make oil stand on it's own.

Every criticism of ethanol has to be made with respect to the fact that it is a substitute for gasoline. It's either one or the other. Take your pick.

No, you have it exactly opposite. I locked in a price because I was more afraid it would go down than that it would go up. If I thought it was going up, and wouldn't have forward priced the corn.

I believe you have a mistaken impression about the ethanol subsidies. The only subsidy paid on ethanol is to the party that purchases it at the plant and blends it with gasoline. That is why it is called a "blenders credit". It is 51 cents per gallon, but goes down to 46 cents per gallon with the new farm bill (if it is passed).

ABout 4 weeks ago, ethanol was selling at the plants for about $2.40 per gallon. THe blender buys it, receives a 51 cent blenders credit, and then mixes it with pure gasoline. He then sells it for $3 plus. So who gets this money? Once again, it is the petroleum industry. Do the math on that formula. I quote 4 weeks ago because that is my most recent knowledge.

There is a tariff on imported ethanol that is equal to the blenders credit. It's purpose is to keep the blenders from receiving a 51 cent credit on foreign ethanol. The two taxes offset each other and net out to $0 to the treasury.

Missouri has an additional subsidy that lasts for only the first five years of a plants production, and only so long as it is majority owned by farmers. It is equal to 10 cents per gallon on only the first 30,000,000 gallons of production. The purpose was to encourage local ownership, which it accomplished beautifully. All of our plants are locally owned, unlike any other state. That means all the profits stay in Missouri and roll throughout the economy. If you don't like this subsidy, I won't argue with you. I think it is very good for the state.

That's it. That is the full extent of subsidies to the ethanol industry.

"For America, we are currently spending .6 trillion dollars a year on foreign oil. Dirty, diminishing, monopolistic, oil that kills when it spills.

You and many others seem to truly love it."

Of course not. If this were a thread on the oil subsidies, I'd be arguing against them, too, since they also provide us with no significant economic benefit, unless you happen to be sitting on a pile of oil stock, and actually perpetuate an environmental detriment.

However, this is a thread about the ethanol agri-industry.

based on the expectation of higher prices due to the subsidy.

However, that doesn't detract from my overarching point, which was that we taxpayers generally aren't realizing a net economic or environmental benefit from the subsidy, which is made with our tax dollars.

Oh yes, one last comment not included in the last post.

You say that ethanol and agriculture industries are benefitting from ethanol subsidies. I am a farmer, and right now I don't really know how much I am benefitting. My cost of production for this year has skyrocketed beyond belief. I have not sold any corn yet, and won't until September at the earliest. We don't even have it all planted yet due to the wet and cold weather. Some of our fertilizers and chemicals ahve doubled and tripled in cost. Some of that corn has been forward priced for over a year at $2/bushel below the current prices. I am not assured of a profit this year.

Have you seen the profits the oil companies are reporting for the first quarter this year?

Well, the simple answer is yes, the American consumer is getting a lot for their ethanol subsidy. Without them, ethanol wouldn't be here. Oil would still hold a monopoly on the liquid fuel market.

I think it has already been explained that ethanol is not the major contributor to food price increases. According to the US Dept of Ag, less than 10% of food price inflation can be attributed to ethanol. It is actually arguably far less than 10%.

I'm sorry that I insulted your patriotism. But the fact is that you are simply ignoring the benefits to the American economy of developing a product that keeps money at home. It is very short-sighted to ignore this.

Many people want to discuss pros and cons of ethanol as if it existed in a vacuum. It doesn't. It has to be compared to its only competitor. Oil. In every single respect, it is far better.

You choose to believe propoganda financed by oil companies. You are not alone. I fail to understand why so many people WANT to believe all the urban myths and misconceptions regarding ethanol.

At this point, I see no further point in arguing. You are going to believe what you want to believe. If there are enough like you, we will very likely lose the only alternative fuel we have until hydrogen becomes available in something like 25 years.

No matter how hard a person believes them, wrong facts remain wrong facts. And we all suffer from believing wrong facts.

For America, we are currently spending .6 trillion dollars a year on foreign oil. Dirty, diminishing, monopolistic, oil that kills when it spills.

You and many others seem to truly love it.

How you manage to turn my questioning of handing out subsidies to the ethanol and oil industries to some sort of blot on my patriotism.

I'm all for eliminating oil industry subsidies. However, the existence of oil subsidies does nothing to counter the relevance of my question as to whether taxpayers are realizing any benefit from ethanol subsidies.

We know that ethanol and agriculture industries are benefitting from ethanol subsidies, but with food prices skyrocketing as a result of increased agricultural focus on ethanol production, coupled with the negligible environmental benefit (or arguable environmental detriment) from ethanol production and use, we should be casting a hard look at whether we taxpayers are getting any sort of net benefit from our tax dollars funding the ethanol and agri- industries.

Sorry son, I just ain't convinced -- and you haven't convinced me that my skepticism makes me any less patriotic.

Subsidies give lenders the courage to invest in a risky venture. And believe me, investing in ethanol is risky. It is a direct competitor with the oil companies. They hate it with a passion and they are doing everything in their power to kill it. If it weren't for actions government has taken, it would have been long gone before now.

They are spending hundreds of millions of dollars to kill ethanol. The biggest part of that effort is funding negative studies. They can buy any result they want. Many in the public fall for their propaganda quite easily.

As I said before, if you remove the subsidies from oil, and require them to handle it through their infrastructure equally to their own product, then ethanol can compete quite easily.

It is very unfortunate for our country that many people like you choose to believe the way you do.

"For the sake of America, you should, at the very least, be praying that everything the ethanol industry tells you is true.

Which it is. There would not be billions of dollars invested by thousands of people to build an industry that was built on nothing but a house of straws."

Sure there would -- if they can count on recouping their investment via subsidies funded by our tax dollars.

That's just fine, interface. Take away the oil subsidies first, and then you can freely take away the ethanol subsidies. And by the way, some of the oil subsidies include american soldiers lives and a huge military presence required to protect oil supplies.

Anyone that can argue against ethanol because of the possibility (but not the likelihood) of losing 2% gas mileage and because of the minor subsidies required to move ethanol into the oil industries own infrastructure is either incredibly short-sighted or is a shill for the oil companies and OPEC.

Facts are readily available that dispute that ethanol is a major contibutor to food price inflation. Facts are also readily avaible that dispute the Science article that claimed ethanol was contributing to excess CO2 pollution. That article was based on assumptions that are absolutely false, and have been already disputed by reputable scientists.

Don't forget that the oil companies themselves are financing some of the negative ethanol studies.

You can choose to believe the science generated by the oil companies, or you can choose to believe the science offered by independent researchers.

I can't understand any American that chooses to believe everything negative they read about ethanol and to dismiss anything that is positive. For the sake of America, you should, at the very least, be praying that everything the ethanol industry tells you is true.

Which it is. There would not be billions of dollars invested by thousands of people to build an industry that was built on nothing but a house of straws.

To oil subsidies -- when I've already agreed that we should ask the same questions of oil subsidies as we are of the ethanol subsidy. I don't think either subsidy serves the average American taxpayer well, and both should be stopped.

The industry getting enriched is big oil and OPEC. You must be for sending Americas' fuel dollars out of America and being dependent on other countries for our energy needs? The government is going to spend them anyway, so I am for keeping them in the pockets of Americans. Not wasted in the imaginary world

You seem to live in an imaginary world. I live in the real world, and in the real world, ethanol subsidies are simply enriching the industry while failing to provide us with any significant benefit.

Waste of our tax dollars.

Ethanol has a postive gain in energy when produced, gasoline has a negative energy gain when it is produced as do most fossil fuels. The dept of energy has the numbers. Sugercane is a tropical crop, can not grow it this far north. We have corn and corn is the foundation on which the future cellulosic industry will be built. You are wrong on the land use issue as well, with modern farming practices and the American farmers desire to farm in a coservation freindly manner, there will be no harm done. They live where they work and take exceptionial care of thier land and water. The ethanol blenders credit of 51 cents a gallon goes to the blender of which is mostly big oil, BP buys more ethanol than anyone. Because oil is subsidized so heavily any other alternative fuel has to be included to have a fighting chance to get into the monoploy big oil has on the fuel market. Ethanol plants and farmers DO NOT receive this credit and big oil passes most of it onto the consumer saving them money also. It is a rediculous statement to say ethanol is the reason food is higher! Not that high oil, weak dollar, growth in China and India and a global demand for a better diet would have a part in it! Ethanol is better and safer for the environment, is not starving anyone, creates American jobs, keeps fuel dollars here at home, is saving the consumer money at the gas pump and saving taxpayers money that is not being spent in crop subsidies. Read this Chicago Tribune story http://www.chicagotribune.com/news/opinion/chi-oped0506fuelmay06,0,481881.story The Tribune gets it right, to bad the KC star keeps getting it wrong.

"The energy balance of corn ethanol is extremely poor in the United States. Energy balance is basically the ratio between the amount of fossil fuel energy that needs to be expended to produce a biofuel and the actual energy output. Corn ethanol generally produces 1.3 energy units for every unit of fossil fuel energy committed to its production. A more efficient form of ethanol like that made from sugarcane in Brazil produces approximately eight energy units for every unit of fossil fuel energy. The meaning of this is that the United States expends a huge amount of fossil fuel in the creation of its corn ethanol and fails to increase its energy self-sufficiency by a large margin.

It is also extremely questionable whether corn ethanol is even more environmentally friendly, particularly after all the factors involved in its production are accounted for. Most commonly accounted for are the emissions in growing the corn, transportation to the factory, processing it into ethanol, and other obvious sources. However, assessments may commonly omit other emissions sources involved in the use of ethanol, references to the change in land-use from an increased demand for corn, which may also include problems concerning water supply due to the farming practices required for corn.

Even if using corn ethanol did have a demonstrably powerful impact to reduce environmental harm, it would not excuse the gross effect U.S. subsidies of ethanol are having on international food prices. As I mentioned, food prices have been dangerously rising in the past few years, and a large portion of that increase can be attributed to increasing ethanol production."

http://www.universityregister.org/index.php?option=com_content&task=view&id=524&Itemid=30

Add to this the extra production costs for fuel that gas companies must pay in formulating and shipping ethanol blends, and we can see that any claim that ethanol is saving motorists fuel costs is questionable at best.

This subsidy, paid for out of OUR tax dollars, isn't benefitting anyone other than the agricultural industry and the ethanol industry.

I understand bad things can happen when you spill Ethanol, but that kind of stuff happens everyday, you can't control it sometimes. If you want to see what oil spills can do look at the coasts when they leak and kill millions of birds, fish and other animals. Ethanol is an alcohol, so the worse you can do in an Ethanol spill is to drink it or burn it off...I think I would prefer the first option. Let's just stop all the discussion on here, get a tanker load of Ethanol and have a party to discuss the topic!

According to a study released by Merrill Lynch the added supply of ethanol is keeping gasoline 15% lower than it would otherwise be. So if gas is $3.50 a gallon that would be $.52 a gallon savings. Assuming the average driver travels 15,000 miles a year at 20 mpg that equates to $390.00, that will by allot of groceries. So the motorist is benefiting now. And according to a study released by University of Wisconsin,http://www.wifr.com/home/headlines/18690854.html, as well as the Federal Reserve Bank of Kansas City, that ethanol has not taken corn to these high levels, mostly outside factors and higher food is tied to high oil. High oil and the related higher transportation costs are to blame. There is no shortage of corn. I am a conservative and would love to see government take allot less of my hard earned money as taxes, but since they do not, I would much rather see those tax dollars spent in AMERICA on bio fuels than be sent outside the USA to countries that hate America and want to see us all dead. America sends $1 billion a day out of the country for oil and I am all for keeping as much money as possible in house! Corn based ethanol is the springboard into cellulosic types of ethanol and other renewable fuels and I am all for it. If a person spent the time to do the research I will bet you can find very little industry of anykind that is not the recipient of a government subsidy of some kind, either directly or indirectly. Food and energy are to important to be left to the free market, if one ever really exists anyway, so the government will always meddle in it. Ethanol is not the problem, it is a breath of fresh air into the monoply and strangle hold that OPEC and big oil has on America and the world and renewable fuels need to become as large a part of our energy needs as possible.

"What’s the worse that could happen if you spill ethanol?"

http://www.biodieselinvesting.com/biodiesel-archives/2006/12/06/ethanol-spill-occurs-in-courtland-mn/

http://homepage.mac.com/oscura/ctd/incidents.html

http://www.radioiowa.com/gestalt/go.cfm?objectid=1EDE3C43-C410-3F69-9D3C32621D98A9A7

http://iowastateextension.blogspot.com/2008/02/iowa-falls-ethanol-spill-might-threaten.html

Jeez.

Please do valid research on ethanol before you form such an uneducated opinion as the one presented in this article. For a voluminous source of everything you always wanted to know about ethanol production and more, please read David Blume’s book Alcohol Can Be A Gas
http://www.alcoholcanbeagas.com/?bid=2&aid=CD92&opt= If you’d like a short version, watch the DVD. But you don’t have to take Mr. Blume’s word for it, in case you doubt the expertise of a man who has studied, researched and taught ethanol production for many decades, go to your local library or get on the internet and verify the information he presents.

Now, to counter the information reported in this article let’s start with the fleecing of American taxpayers. Not one penny of our tax dollars actually pays for any government service (including subsidies) – every cent and a whole lot of then some, goes to pay just the interest on the national debt. Check the cost of US oil consumption and the national debt at http://zfacts.com/p/461.html Most of us would agree we’d like our government to stop borrowing from the Federal Reserve to support industries - all industries that cannot stand on their own merits in what is supposed to be a free-market society.
Most of the big subsidy and wasted money goes to the mega-farms and some to people like the Houston surgeon who built a mansion on a plot of land that used to be a rice farm and now gets a subsidy for the acres of land surrounding his spacious home. There are farmers that want to farm, but can’t because of subsidies. You may have seen this story covered on Bill Moyers Journal a few weeks ago.
Many people can and have provided the information showing that ethanol is much less subsidized than the oil, gas and coal industries. However, if we eliminated all fuel and energy subsidies, those for petroleum, electric, gas, coal and bio-fuels, including ethanol and went to a truly free market, it would soon be apparent what industries are being forced upon us by our government and big-business lobbyists. American farmers and ethanol would win on an even playing field. Additionally, corn is not even the best crop for feed or ethanol production although it is one of the biggest at this time. Overfeeding of grains causes digestive problems for cattle. Feeding proper plant based material increases meat and milk production and reduces the feed per pound of meat/milk cost ratio.

It may be true that ethanol is slightly less efficient than gasoline in vehicles that are not made to run on ethanol. But in vehicles optimized for alcohol fuel, alcohol can get some of the best fuel efficiency, with better performance (think race cars), even beating out diesels. Is the 3% reduction that you report, (for non flex-fuel and unoptimized vehicles) not worth the lower price at the gas pump, thousands of miles saved in oil transport, the benefit to the environment and the support of local American farmers? For every dollar (or more correctly $4+) that gets paid for a gallon of gas, there’s more money going to foreign and multinational corporations and countries to enrich them to unconceivable levels. When a gas dollar leaves this country, how much of it do you think makes it back into our economy (especially coupled with the loss of manufacturing)? How long can the American economy afford this hemorrhage of revenues?
For every gallon of ethanol purchased, that is money spent in our communities, paid to our citizens and recirculated back into our economy.

Corn prices have soared, yes but so has the price of milk, lumber, first class postage, electricity, property taxes and a haircut at the local salon. EVERYTHING has gone up, except the wages and lifestyle of hard-working people. It’s rising fuel prices, not corn that has caused the cost of everything else to go up. Fuel affects everything. Unless you live in a cave somewhere and eat wild berries you will be affected by higher fuel prices. And oil is one of the most fragile fuels when it comes to being affected by world events. We purchase oil from foreign countries – that means a falling dollar will take more dollars to buy the same barrel of oil + competition (rising demand) for shrinking supply (peak oil) raises the price + it requires an enormous amount of energy (and military protection) to transport oil thousands of miles from the field to the refineries and then to the gas pumps at your local station + any instability in the source countries, and they are generally unstable areas + any accident, attack or other world event, = higher and higher prices. Or it could just be… summer… or a few days before a holiday. We all know how summer and holidays require the price of gas to go up.

As the more informed individuals have stated corn is not the only and optimum source for ethanol production. BTW, there are 6 ½ pounds of cellulosic matter (stalk and roots) for every 1-pound of grain in corn. And cellulose can be made into ethanol. Cellulose is made up of numerous sugar molecules. Sugar is the best source (because it is in basic form) for the fermentation (think making apple cider) and distillation process (think still) that produces ethanol. How long, and in how many societies, has man been able to ferment plants and distill it? Nearly since the beginning of mankind, and in every corner of the globe. Do you think that might have something to do with the assault on ethanol? Is it possible to gage the lengths and ability of a century old industry with trillions of dollars at its disposal as well as at stake, would go to discredit any and all alternatives to it until that industry itself can be the one to provide it? Can you imagine a world where individuals and communities grow and produce their own fuel, and not just auto fuel, but also the fuel needed to provide all their energy needs? We could call that Reverse Globalization.

Ethanol production done properly, as described in David Blume’s book will not only provide the energy for all human activity (estimates range from 6 to 15x over); restore nutrients and soils, provide better grade animal feeds (DDGS), improve and increase food production, reduce the need for pesticides and fertilizers (which like gas, are petroleum products), provide millions of local jobs in every community, and remove CO2 from the atmosphere (remember plants use CO2 in their growth process).

If you’re still not intrigued by the possibilities of ethanol production look at these facts:
Brazil, the 5th largest country in the world, is foreign oil free, and has been running production line cars for decades with at least 50% ethanol made from sugarcane – their locally sustainable crop.
Most ALL cars can be run on at least 50% ethanol, some run E85, with NO MODIFICATIONS. Model A’s were DUAL FUEL vehicles; they ran on both alcohol and gas. Ask yourself, what came first – gas stations or automobiles? How could the auto revolution happen if there weren’t gas stations dotting the landscape? Because cars originally ran on ethanol which was readily available at almost any farm.
The number one irrigated crop in America is LAWNS! Grass clippings alone could produce 11 billion gallons of fuel per year. Done at local levels, with local waste materials, “crops” like this as well as farmed crops would be a true solution to our “oil addiction”.

Big Oil’s problems are becoming clearer every time I visit the gas pump. Not to mention every time anther person suffers from a lung disease or there’s an oil spill. What’s the worse that could happen if you spill ethanol? The earthworms get drunk? Clean air, clean fuel, more jobs, freedom from oil addiction and local control, all from….plants and three basic processes, photosynthesis, fermentation and distillation. So simple a caveman could do it – oh, yeah they were doing it.

"the linkage between ethanol and GHG emissions. Scientists now believe that the production of ethanol actually creates more harmful emissions than it prevents. Indeed, Princeton University professor Timothy Searchinger and other researchers have concluded that “corn-based ethanol, instead of producing a 20 percent savings, nearly doubles greenhouse emissions over 30 years and increases greenhouse gases for 167 years.” (Their findings were published earlier this year in Science magazine.) The reason is that converting undeveloped land to cropland—in order to grow more corn and facilitate biofuel production—releases a massive amount of carbon dioxide. Only if biofuels are made from waste products or grown on abandoned agricultural lands does the production process actually reduce GHG emissions.

Scientists now believe that the production of ethanol actually creates more harmful emissions than it prevents.This might suggest that there are ways of producing biofuels that do not lead to increases in greenhouses gases: just produce them out of waste material, without cutting down forests or plowing over fields. Yet Larry Kumins, vice president of the Energy Policy Research Foundation, has shown that the level of U.S. ethanol production in 2007—about 8 billion gallons, or 5 percent of the gasoline pool—is optimal. Producing 9 billion gallons this year will be difficult, and producing 36 billion gallons in 2022 will be impossible with today’s technology.

Here’s why: since ethanol separates from gasoline in the presence of water, the blends of ethanol and gasoline that many of us put in our cars can’t be transported through pipelines. Instead, ethanol is shipped by rail [which takes more fuel], at greater cost than gasoline, and mixed with gasoline near the point of distribution. That’s why the 10 percent ethanol-gasoline blends are not available all over the country, only in major metropolitan areas."

http://www.american.com/archive/2008/april-04-08/the-case-for-ending-ethanol-subsidies

"The energy balance of corn ethanol is extremely poor in the United States. Energy balance is basically the ratio between the amount of fossil fuel energy that needs to be expended to produce a biofuel and the actual energy output. Corn ethanol generally produces 1.3 energy units for every unit of fossil fuel energy committed to its production. A more efficient form of ethanol like that made from sugarcane in Brazil produces approximately eight energy units for every unit of fossil fuel energy. The meaning of this is that the United States expends a huge amount of fossil fuel in the creation of its corn ethanol and fails to increase its energy self-sufficiency by a large margin.

It is also extremely questionable whether corn ethanol is even more environmentally friendly, particularly after all the factors involved in its production are accounted for. Most commonly accounted for are the emissions in growing the corn, transportation to the factory, processing it into ethanol, and other obvious sources. However, assessments may commonly omit other emissions sources involved in the use of ethanol, references to the change in land-use from an increased demand for corn, which may also include problems concerning water supply due to the farming practices required for corn.

Even if using corn ethanol did have a demonstrably powerful impact to reduce environmental harm, it would not excuse the gross effect U.S. subsidies of ethanol are having on international food prices. As I mentioned, food prices have been dangerously rising in the past few years, and a large portion of that increase can be attributed to increasing ethanol production."

http://www.universityregister.org/index.php?option=com_content&task=view&id=524&Itemid=30

I'm glad that you're keeping this thread alive, because it's a great opportunity to expose some serious misconceptions about the environmental and economic impact of ethanol and the ethanol industry.

There's an awful lot of talk about corn subsidies but not a lot of understanding. Oil companies get so much money from our taxes that we are really paying $6 or $7 a gallon for it. Most apologists don't like to call them subsidies, they call them business incentives or some such tripe. Their money benefits no one in the community. Meanwhile, ethanol subsidies go back into the community, generating tax revenues and providing the government with more money than any oil co. racketeer will.

If you want to talk about mandated use, let's look at gasoline. We are given no choice in the matter, we have to run our cars on it. Free market decisions on this were taken away back in the early 20th century when Rockefeller snuffed the competition with his backing of Prohibition. And you thought it was about public drunkenness?

Gasoline is a filthy garbage product that shouldn't be used for anything. It's time for a change and ethanol, if developed properly, and if we can start prodding farmers to grow energy crops other than corn, can make more than a significant contribution.

THe whole story is here.

http://www.alcoholcanbeagas.com?bid=2&aid=CD8&opt=

Read the book and prepare for a few shocks. I've run my unaltered car engine on E-85 and have not had any problems. Car cos say this isn't possible. More surprises to come!

How isn't it benefiting the environment, that is why the clean cities act was put into place and why Ethanol is used in most majors cities across the US. They know it is helping with air emissions and there is all kinds of proof to show that.
I think we are to a good point to agree to disagree on the food and subsidies debate, we both could go on all day about it and try to convince the other. I have tried to put the facts out there and trust me I want to make sure our tax dollars are being used in a way that benefits all, but that will never happen. I have addressed the rising food costs and showed where the rise is coming from, but understand Ethanol is a great excuse for everything. We are using more corn for Ethanol, but the crop for the first time is a demand crop and not a supply crop, shouldn't that be a good thing. Finally farmers are not getting government subsidies to supplement for the price because for the first time in history they are getting a price that competes and that is fair. Farmers will continue to grow corn because that is what they do and what they love. It's not good to pin down the people that are feeding AND fueling the world because what if they stop one day, it isn't going to be good for anyone. But you know what they won't stop because that is what they do...they FARM!

is that the ethanol subsidy benefits only those in the industry, while food prices for all of us rise as more cropland is used for ethanol production rather than feedstock, and we're relizing negligible to no environmental benefit.

I understand why you, as a member of industry, want this subsidy to continue, but we, as taxpayers, need to ask hard questions about what we're getting for our money -- and it doesn't appear that we're getting much.

How is this Apples and Oranges, aren't we talking about fuel. Ethanol is fuel, just the same as gas. The subsidies you referenced do not go to the Ethanol plant, they go to the blender of the Ethanol and the Gas. These blenders are at the terminal most of the time and owned by oil companies, not Ethanol plants and certainly not farmers. So the 51 cents in reality is being kept by the oil company. Look at it this way if Ethanol costs $2.00 at the plant and it is blended at the terminal, the owner of the terminal gets a 51 cents tax credit, which would make the cost of the Ethanol $1.49. If they are getting 51 cents back you would think they would reflect that in their price, but they aren't. Since Ethanol is cheaper even without the 51 cents, the oil guys would still buy it because it is an additive of octane to their gas and they can have a lower octane gas and bring the octane level up where they need it. They won't tell you they like Ethanol, but they do. I just wish they would reflect the 51 cents in their price more than they do.

Also if we pull the 54 cent tariff we will be subsidizing international Ethanol and not our home grown Ethanol…again depending on other countries for our energy source. I believe it is in our countries best interest to develop our own energy sources.

"We are fine with taking away all our subsidies if you take away oil subsidies too"

You're talking about apples and oranges, but as I said earlier, I think we taxpayers need to ask whether we're getting a return on our oil subsidies just the same as whether we're getting a return on ethanol subsidies.

Here's some articles on ethanol subsidies and information on how they've benefitted few outside the agricultural and ethanol industry:

http://www.american.com/archive/2008/april-04-08/the-case-for-ending-ethanol-subsidies

http://www.taxpayer.net/energy/ethanol.htm

http://www.usnews.com/articles/business/economy/2008/01/24/subsidies-and-high-crop-prices.html

Explain what subsidies you all are talking about, I want to know how much you know about them. We are fine with taking away all our subsidies if you take away oil subsidies too, it needs to be a level playing field.

dalailama is upset at the notion that ethanol subsidies are not benefitting anyone other than corn growers and ethanol manufacturers -- he's in the industry that's benefitting from those subsidies.

Someone posted Ethanol subsidies information if you would like to read that. I do believe it answers the questions about subsidies and how much farmers are really saving your tax dollars. Also yes I do think people are dumb enough to think field corn is peaches and cream (a very good hybrid of sweet corn, my favorite actually), that is why the food and fuel debate is so out of hand. You may know the difference but there are millions that don't and that is a problem. About the labeling information, we would love to have labels put back on the pumps because people want to know there is Ethanol because they want it. People in Missouri need to know all of their gas has Ethanol in it and has for quite a while, not just starting at the beginning of this year. We don't have anything to hide, we want everyone to know what a great product they are using.

Do not confuse me with ADM...we are farmer owned Ethanol plants in the state of Missouri. Farmer invested, not corporate invested. We are farmers like your relative and friends, not some big company trying to take away the small guy, we are the small guy. With Ethanol all farmers win, what is wrong with that? They are finally getting a little more for their crop they grow, but still aren't seeing the growth/profits like every other industry. We have more of a story to tell than blaming the farmers, it all starts with oil and transporation costs. With the high cost of fuel, fertilizer and other inputs, to raise an acre of corn this year alone will be over $500/acre. Good thing there is $5 corn to help pay for it. We can either get paid more for the corn we produce, or go back to having the government subsidies us for under producing...I would rather not take farm subsidies and put that money to other industries. If you want good information not paid for by Ag interest, look at the Merril Lynch study. There was no AG interest at all and yet they see the light. When you talk about energy balance of Ethanol compared to Gas, Ethanol gives back 1.7 units of energy for every unit it costs to make, where as oil is only .9 units for every 1 unit to make, so if you're looking for a negative energy balance take a look at what you just put in your tank, 90% of whats in your tank if you're from Missouri, the other 10% is Ethanol. Also did you know we produce enough Ethanol in the US to dispace all the imported oil from Kuwait and Iraq? I think we are making a difference!

You mean you don't feed Peaches & Cream to cattle? Do you really think people are that stupid that they didn't know the difference between sweet corn and feed corn?

I'm against ethanol subsidies, not because of it's impact on food prices, but because if it's a legitimate gas replacement, it shouldn't require forced demand by the government. If ethanol is so great, why did the ethanol lobby successfully get gas pump labels removed that stated what the Ethanol content was. What are they trying to hide? Why do you hate consumers, why don't you feel they are entitled to know what they are buying?

Attention all Ethanol haters: You really don't know what you are talking about.

All the blaming ethanol for high food prices and claiming we can't free ourselves from oil is getting out of hand, and people need to wake up to reality. Blame the oil companies, folks - not farmers.

Or pick up a copy of David Blume's book, Alcohol Can Be A Gas: http://www.alcoholcanbeagas.com/?bid=2&aid=CD1&opt=

To keep blaming corn for high food prices is the height of ignorance. Sure, there are correlations, but to place all the blame on it simply shows there are many uneducated people out there. Take a look at this price index and decide for yourself what is the REAL reason for food prices skyrocketing:

http://agadvocate.files.wordpress.com/2008/04/commodity-price-comparison1.png

Let me REPEAT: Oil is the cause of food prices, and we can make fuel from things OTHER THAN CORN. Therefore, it's not ETHANOL's fault, rather the existing agricultural system in place supporting the WAY WE SUPPORT ETHANOL. Get it yet?

Corn is one answer for sure, and gets you about 200 gallons of ethanol per acre. Here are some lovely examples of different feedstocks we can use:

Cattails - 2,500 gallons per acre (12.5 X more than corn)
Sorghum - 3,500 gallons per acre (17.5 X more than corn)
Fodder beats - 940 gallons per acre (4.7 X more than corn)

There are about 30 more feedstocks, from fruit to 70 million acres of weeds (mesquite) that we can make fuel from. And before you get all worked up over the food VS fuel argument, anyone can look at world crop production and see that we produce around twice the calories we need to feed everyone. What we have is a money shortage, since food is a commodity and not a right: Whoever can pay for it gets to buy it.

If you are angry enough, maybe it's time to turn off the TV and video games and get involved a lot more. You can start by making sure you get involved by educating your politicians, supporting your local farmers, finding alternative transportation other than driving everywhere, and planting food at home.

This way we can start acting like grown ups and fix our problems instead of letting oil lobbyists and corporations continue to screw things up even more.

The only thing I buy at Walmart is ammo.

Bottom line: Ethanol cannot and will not ever replace our use of foreign oil. It is not cost effective to manufacture, and it contains less energy than an equivalent amount of gas.

I said you are a Communist because you apparently do not believe in freedom of speech, and you feel that anyone who disagrees with you should be deported. Your wish to silence dissent is frequent in Communist coutries (Tiananmen Square?) Do you drive a tank?

I can make a baseless claim that YOUR data was paid for by Ag interests and is also bogus. I'm sure ADM and Monsanto never paid for a study to promote their agenda. If you are so sure of yourself, feel free to posts some links to back it up.

Roughly half of our gas comes from Canada - do they hate America because we always win the Stanley Cup?

My grandfather was a farmer, and my best friend from college is a farmer in Iowa. So you can spare me the "I hate hate farmers" bit. I don't feel our tax dollars should be spent to prop up a gas "replacement" that will never be able to fully satisfy America's fuel needs.

I don't want to attack anyone, however I do feel one statement needs to be addressed. The statement that ethanol is a "failed experiment and a waste of our tax dollars" is grossly ignoring the big picture. Our country is heavily dependent on foreign energy sources, which I doubt anyone will argue. Corn based ethanol, while not a silver bullet, is a great stepping stone to further technology to reduce our dependence. Cellulosic ethanol is on the verge of becoming a very real energy source, however without corn-based ethanol, it may not even be on the distant horizon. Additionally the subsidies for ethanol are nothing in comparison to the extent the oil industry is subsidized. In 2007 tax incentives provided to the ethanol industry totaled ~$3.4 billion. In 2008 that number is expected to reach $4 - 5 billion, however ethanol is predicted to lower govt. farm payments by $8-12 billion. We spend nearly $44 billion just safegaurding oil supplies every year in addition to the ~$3.75 billion paid yearly in subsidies.

If helping the corn-based ethanol industry leads to a future with numerous alternative energy sources, I don't see how we can consistently knock it down.

It is spring time and soon there will be sweet corn in all the farmers markets and grocery stores. That sounds great right? But did you know the corn you buy in the store is not the same corn you use for Ethanol? I bet you didn't. The corn used for Ethanol and Feed for Animals is #2 Yellow Corn. Have you ever tried to eat #2 corn? It is not good at all...to starchy! In fact, did you know only 10% of the corn grown in the US actually goes to human consumption. Put some butter on that for a while and let me know your thoughts!

Before I get started the only way you got your misinformation on E85 is because you probably read some WELL PAID SCIENTIST report, that was WELL PAID, by an oil company. Now let me get this right...you would rather your tax dollars go to Hugo Chaves, Exxon Mobile and countries who hate America...that would be really good. If you get rid of Ethanol now, you are letting those guys win the energy battle. Do you honestly believe there is a free market in the oil industry? If so you should really rethink your thougts. We are under the control of the countries with the oil and as American farmers we are trying to do our part to get away from them by producing the renewable product to displace oil imported in and your tax dollars being exported out. Now on the Communist thing? That is funny. Lets look at what communism is. Communism is a socioeconomic structure that promotes the establishment of a classless, stateless society based on common ownership of the means of production. Doesn't that describe the oil industry? We can't control anything and the oil has common ownership, just happens to be in different countries. If you think I'm' communist, you obviously didn't know what it meant. Have fun in your free market world and make sure you grab all your needs next time your in Wal Mart!

It's clear that ethanol has increased the demand for corn, which has driven the price of corn up, which has driven food prices up, since corn is a major animal food stock in addition to being in many of our food products.

However, I'm not sure how I'd blame ethanol for oil profits. You seem to miss my point -- I'm saying that the subsidy for corn based ethanol hasn't succeeded in accomplishing its purpose, of providing an affordable alternative to gasoline, but it has driven up food prices (of course in conjunction with other costs of providing food, including - drum roll - rising fuel prices).

Essentially, it's a failed experiment and a waste of our tax dollars -- the subsidy, paid for out of our taxes, is enriching a few, and not saving the average taxpayer any money. Any savings in fuel costs (which seem to be negligable) are offset by the rise in food prices due in large part to the growing cost of corn because of that very subsidy.

You are right, I do care what you think, but I just want to give you facts to use, so we are on the same page. Here are some numbers that might put your rising food costs thoughts to rest. The food in the US is the cheapest in the world with Americans only spending about 10% of their income on food. Even with corn moving from $2 to $5 per bushels that only takes the amount of corn in a box of corn flakes from about 3 cents to about 5 cents. Even if it doubled from 3 cents to 6 cents, I didn't know that added $1/box in the stores. What may be causing it to go up a $1+....Any guesses? How about the rising cost of oil/gasoline? I bet that causes it to go up, don't you think. If you take every dollar spent on food, 38 cents goes to labor (which labor is higher now because of min. wage floor prices), 24 cents goes to transportation (highest gas prices in recent history), packaging, energy and only 19 cents actually goes to the farmer who produced the food. If energy costs goes up $1 a gallon, that has 3 times the impact on retail food as compared to a $1/bushel increase in corn prices. I could give you a lot of examples on how little corn impacts the food cost, but just look at $4+ fuel cost and the transportation to get from one place to the other. Someone is making a lot of money right now and it isn't the corn farmer. It's amazing how oil's profits are at a record high and everyone is blaming corn/ethanol, there are a lot of people with misinformation out there, please don't be one of them.

Dalailama - is that name of idiot descent or dumb-ass descent? Anyone who disagress with this tool is anti-American and should be deported, spoken like a true patriot!

No one is against farmers, but corn-based ethanol is not the anwer to our energy problems. E85 actually costs 50 cents more per gallon when you factor in that it has less energy per gallon than gas.

I prefer my tax dollars do not go to suppport corporate mega-farms with ethanol and furlough subsidies. Explain to me how it makes sense to pay farmers to NOT plant crops?

"It also appeared you were attacking riekhofgm"
- so your attack on Yael by inferring that he is of foreign descent and therefore anti-American wasn't an attack?

Based on your rants, I'd say you are a communist, not an American.

to respond and then concludes "because no one cares what you think!"

No one, it appears, except for "dalailama." ;-)

It seems that any savings we might realize on fuel from ethanol is far outweighed by the skyrocketing food prices due the higher cost of corn.

If you would have read other's posted thougths, you would see that Ethanol is holding gas prices down by over 15% nationwide and in Missouri alone you are saving 10 cents/gallon everytime you fill up. I don't know where you get your thoughts, but they certainly aren't factual. It also appeared you were attacking riekhofgm, when he was only responding to the original article, not your thoughts, because no one cares what you think! Have a good one!

"Can we assume you also will cut off all subsidies to the super rich oil companies?"

Yep. See my previous post.

I'm rather conservative about how our tax dollars are spent. I don't like to see them thrown away just to enrich a few with no benefit to the rest of us.

I wasn't aware that the ethanol subsidy was a jobs program -- I thought it was to provide us with fuel alternatives that would help drive the cost of gas down. Hasn't done that -- but it has driven the costs of food up, which is hitting us all where it hurts.

Can I assume your are anti jobs for MO. You want us to send most of our petro dollars to the Middle East rather than contribute to the economy of Kansas City. Can we assume you also will cut off all subsidies to the super rich oil companies? They receive more subsidies than corn farmeres will ever think about. Do you want to pay more for your fuel? As much as 50 cents more? Do you want your cost of food to go up even more because of higher transportation costs? Where do you get your information? From OPEC? They do not like Bio Fuels either. It would help if all facts were presented fairly.

are an industry, a very monied and mechanized industry, one which is reaping a huge benefit from subsidies, and we should be asking whether we, the public, are benefitting from spending our dollars on that subsidy. This is our tax dollars we're talking about. We should be asking the same of oil subsidies. ExxonMobil stock is doing great and profits are booming, but where's our benefit?

Gone are the days of the 40-acre farm and sunbonnets.

Yael T. Abouhalkah (is that American decent or Middle Eastern Oil decent? Just wondering), I think you are the one that needs to be forgotten! What you write is so wrong and anti-American you should not only get your cheap food supply taken away, but you should get your citizenship pulled and taken to countries who hate America, but it looks like you would fit in there also. If you can’t support the American farmer, the farmer who is feeding AND fueling the world, then who are you going to support…I know, the people who hate America and would do anything to see it gone. If you are going to attack the farmer, then take away everything the farmer helps to produce and see how long you would survive. I’m guessing not long at all. Corn farmers are still farmers and Agriculture will stick together to the end, which you are obviously hoping is sooner than later. It is easy to see the Kansas City Star hates farmers and America if it allows one of their writers to write such uninformed information. Maybe they will think of that the next time, but it is evident there is a higher source providing funds or wrong information that money is talking instead of common since! Tell your buddies Hugo Chaves, Exxon Mobile and others hello from the farming community…we aren’t going anywhere!

Does it not matter that oil receives far more in subsidies than does ethanol. Yet ethanol is supposed to compete with a product that can only be sold through oil company infrastructure?

Does it not matter that the US is spending 1/2 trillion dollars per year on foreign oil? Our economy cannont sustain that level of spending. Does it not matter that ethanol is the only alternative that is available now?

All of the "problems" referred to are mostly misinformation, un-proven insinuations, and urban myths. Ethanol's role in increasing food prices is very small. Only 3% of the increase according to the US Department of Agriculture. Ethanol is holding down the price of gasoline by 15% according to Merryll Lynch. Saint Louis wasn't able to meet EPA air standards until they began using ethanol.

I'm constantly amazed at the ranting about ethanol whenever petroleum is the problem that is pulling this country into recession.