Farm and Food: Some more free-trade, grain-alcohol Kool-Aid

Lincoln Journal Star ^ | Saturday, Mar 17, 2007 | ALAN GUEBERT

[hedgetrimmer]

Everything ethanol touches seems to get giddy on the grain alcohol’s future or its fumes.

For example, early last winter several farm groups endorsed a controversial congressional plan to open America’s outer continental shelf for energy exploration. What dog could groups like the National Corn Growers Association have in the hunt for Gulf of Mexico natural gas?

A big one: More exploration may lead to more natural gas. More natural gas may mean more and cheaper gas-based anhydrous ammonia, corn’s chief fertilizer. More and cheaper fertilizer means more corn and more corn means more ethanol.

So, in the circular logic that drives much of the U.S. ethanol industry, more tax-break driven, environmentally-questionable coastal drilling for a natural, clean-burning fuel will now power additional production of a subsidized grain that will then be converted into another, more heavily subsidized fuel.

The legislation passed and, on Dec. 11, NCGA announced that its members were “very happy with the legislative victories securing more domestic development of natural gas, continuing our positive push for better trade and extending significant tax incentives for the ever-growing ethanol industry.”

If that recipe—a “positive push for better trade and significant tax incentives”—appears at odds with free market policies promoted by groups like the corn growers keep in mind that the Kool-Aid being mixed here includes ethanol.

Indeed, the offshore drilling legislation backed by the association also extended America’s 54-cents-per-gallon tariff on imported ethanol through Jan. 1, 2009, thus protecting domestic producers from cheaper, chiefly Brazilian, ethanol imports for another year.

America’s biggest ethanol backer, President George W. Bush, however, had a hard time swallowing the extension. He wanted—and still wants—an unencumbered U.S. biofuel market. It was a point he again made clear in his March 9 meeting (at an ethanol plant near Sao Paulo) with Brazilian President Luiz Incacio Lula da Silva.

When reporters asked Lula if he was going to push the American to cut or eliminate the U.S. tariff on ethanol, Bush interrupted to say that Lula, like him, was stuck with the tariff “through the end of my term. It’s not going to happen.’”

It’s not going to happen now, but pressure is building for it to happen from three, already-apparent directions.

First, even though ethanol is an economically strong 30-year-old, it remains an almost purely political baby. If Latin and South American nations need to export ethanol to create jobs, strengthen their economies and stave off anti-American leaders like Venezuela’s oil-rich populist Hugo Chavez, ethanol’s domestic protection will be dropped like a bad habit.

Second, pressure is building within the U.S. to make changes.

On Dec. 18, President Bush’s brother, then-Florida Gov. Jeb Bush, along with several prominent South American business and government officials, launched the Interamerican Ethanol Commission. The mission is clear: make ethanol a global commodity and create a free, uninhibited international market for it.

President Bush, perhaps proving for the first time that ethanol, like blood, is thicker than water, took an enormous step in that direction March 9 with Brazil’s Lula when they agreed to share ethanol-making technology and expand its production across the hemisphere.

The third reason is Brazil itself. The nation that dealt U.S. farmers their biggest global trade defeat ever, the World Trade Organization’s ruling to kill U.S. cotton subsidies, possesses abundant land, cheap labor and a clear will to supply gas-guzzling American and European drivers with the fuel all believe is their birthright.

And like America drilling for more natural gas to make more ethanol, Brazil will burn its remaining rain forests to grow more sugar cane to make more ethanol to make it happen.

[hedgetrimmer]

On Dec. 18, President Bush’s brother, then-Florida Gov. Jeb Bush, along with several prominent South American business and government officials, launched the Interamerican Ethanol Commission.

Where does he find the time? He runs the Florida FTAA too, to break down our borders and integrate this country with the rest of latin America.

When will America tire of these politicians who use their offices to break down order in this country, and push unConstitutional anti-American agendas?

[hedgetrimmer]

FYI

[George W. Bush]

Sugar cane is far more efficient to produce ethanol.

Using corn will always be less efficient.

Ethanol should be commoditized, just like oil is, not treated like a protected industry.

Higher prices for corn will result in higher prices for food. There's no other way around it.

Our ethanol policy is stupid. And the free trade people are hypocrites when they support it.

[GrandEagle]

Unfortunately I believe it's over for us.
Our Nation's political system can handle many different views, but it will not withstand outright treason in high places.
The enemies of our Republic control both sides of the "isle". Depending which party is in charge, they simply shift agendas.

[hedgetrimmer]

Our ethanol policy is stupid.

It sure is. Its geared to make Mr. Bush and his brother very wealthy, and to give them control over yet another energy producing segment of American industry. It is about as corrupt as a policy can get.