Posted on 12/29/2011 1:10:03 PM PST by Cincinatus' Wife
It will be interesting to watch.
If Congress does nothing about the ethanol requirement, then I'd speculate that:
1. Brazilian imports of ethanol will increase.
2. A lot of American ethanol producers will go bankrupt.
3. The corn crop will return to food production causing skyrocketing prices to gradually fall back to earth.
All in all, a net plus for consumers.
-——The corn crop will return to food production -——
actually, the farmers will make less money because theywill grow less corn
impact on food is minimal
He mentioned he was at John Deere dealer the day before.
New EPA reqs to reduce sulfur will add $20,000 to the cost of some farm equipment for an extremely small amount of pollution reduction.
This kind of regulation is part of what is strangling an economic recovery. Ask any of us who work in the financial industry; same thing. The regulations we have to work around; do nothing to help consumers or make safer financial products.
They just add costs and frustrations to consumers.
The problem is they just want to get rid of the regs. The EPA will still be there, ready to write more regs as soon as they think they can get away with it.
We need to quit poking at the symptoms and go stomp on the problem.
Those farm leaders have said there is no such thing as a level playing field in the energy business and add the government long has supported the oil industry.
natural gas - 25 cents per megawatt hour of electricity produced
Coal - 44 cents per megawatt hour
Nuclear $1.59 per megawatt hour
Wind Energy $23.37 per megawatt hour
Solar Energy $24.34 per megawatt hour
Biofuels $1.78 per gal
These numbers do not include the additional subsidies we taxpayers have been compelled to pay for wind, solar and biofuels through the stimulus plan
Oil was not reported in these numbers since oil is hardly a factor in electricity production. However, oil benefits from a variety of tax subsidies for dry well expenses and royalty holidays dating from the $10-a-barrel oil days of the late 1990s, which the administration promises to rescind.
At the most it would result in a 4.5¢ per gallon increase. But since it also reduces import restrictions, the likely case would be less. Plus market forces would also keep it less than that. The raw cost of the fuel is only part of the cost, production costs (refining), transportation (pipeline & trucking), taxes, and wholesaler and retailer profit margins also factor in.
Is the gasoline mandate going away as well?
actually, the farmers will make less money because theywill grow less corn
impact on food is minimal
Perry says all subsidies should go — along with cutting onerous regulations.
Please listen to Rick Perry’s conference call in Link #1.
You fail to consider time and the perceived lag in production. The prices did rise in response to demand but in response the farmers produced more. This year, there will probably be record production in spite of the floods last spring. The production increase will mitigate the price rise earlier.
The increased production is not sustainable if ethanol subsidies are ended. Thus, farmers lose and land will produce something else or go fallow
Just one more reason why the nominee should be chosen by convention and the primaries and caucuses relegated to what they really are: circus sideshows that you attend for amusement only.
Case in point is the focus of Iowa farmers on keeping their own unfair, uneconomic, undeserved subsidies - most of the rest of the country suffers for these subsidies and allowing Iowa farmers to decide for the rest of us who the nominee is going to be essentially means that the favored nominee is going to be representative only of Iowa, not most of the rest of the country.
What a crying shame.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.