Posted on 02/02/2011 9:00:05 PM PST by 6ft2inhighheelshoes
Ethanol has proven to be an inadequate solution to the problem of foreign oil, but it has toppled at least one Arab ruler and may not be done yet. The Soros backed college students and the Islamists have done their part in the protests, but the Tunisian and Egyptian mobs would never have made their showing without a goad. And the goad was high wheat prices. Part of the spike in wheat prices was due to the shift to ethanol production.
Remember when Americans were lining up with cans of gasoline during the OPEC oil boycott? Arab Muslims are now in the same boat, except with bread, rather than oil. Arab countries are frantically buying wheat, especially after the events in Tunisia and Egypt. Regime stability in the Middle East is now tethered to wheat prices. The Arab has prided itself on the power to pressure America using the price of oil, but the United States has now proven that it can do the same thing to the Arab world with the price of wheat. The price of oil may be climbing in America, but in Saudi Arabia the price of wheat is up by more than half.
The Arab-American relationship was built on a power inequity. They had a resource that we needed. But now we have a resource that they need even more badly. While you can do a lot of things with oil, you can't eat it. And while Americans may get angry when oil prices go up, unlike the Arabs, we don't overthrow the government. Of course anyone can grow wheat. China and India are the world leaders in wheat production. Behind them, Russia, America, Australia and Canada. But Russia has just stopped exporting grain. China uses most of its wheat domestically too but is ramping up export production. Wheat however is only one commodity. There are others.
The Arab Muslim world has held American foreign policy hostage using the one commodity they had that we needed. But as a side effect of their own terrorism, we adopted a course that unintentionally spiked up the price of a commodity they needed. They acted as if violence and chaos could only benefit them by driving up the price of oil, but the rising price of wheat is blowback. We of course did not set out to hammer the Muslim world with ethanol subsidies (though a smarter and cannier administration might have done that) and that is the beauty of it. Instead while trying to untangle ourselves from foreign oil because of their behavior, the net effect was to demonstrate their own instability.
It's more than a lesson in the interconnectedness of the world in the age of globalism. It is also a reminder that we may have more power than we realize. We don't need to invade a country and then occupy it for years at the cost of billions of dollars and thousands of lives. As it turns out we can topple regimes even faster with ethanol subsidies. Of course this isn't actually a solution. Wheat prices hit the poorer Arab countries the hardest. That being the countries without the oil. The net beneficiaries of populist protests will be the Islamists. And wheat won't be a permanent lever. China will ramp up its wheat production more aggressively in response to higher prices. We lack the wheat equivalent of OPEC to function as a price setting cartel. And the current conditions which brought together droughts in China, flooding in Australia and ethanol subsidies in America are close to unique. But what they do is show our power.
Ethanol is controversial on the left because it raises food prices and controversial on the right because it is built on subsidies and regulation. As a substitute for oil, it's inadequate, but as an economic weapon it raises certain possibilities. The United States is an economic superpower, but that is a power we rarely leverage. While the Muslim world has conducted a multipronged assault using lawfare, economic warfare and proxy terrorist groups-- we responded with charm offensives and massive armed offensives. But it can't hurt to take a page out of their book. To also use more subtle weapons. Including economic warfare. And as has already been demonstrated, price volatility can have a more explosive impact than a bomb.
The Muslim world has a small upper class, a sliver of a middle class and a huge underclass. While the trappings of the 21st century are there, from cell phones to the internet, there is more than a slight whiff of the feudal about the whole arrangement. Tyranny and brutality won't upset the applecart, but food availability does. (Medieval revolts were often triggered by high food prices.) What a feudal system needs above all else is stability. The illusion of a timeless order. A way of life in which change does not even exist. Instability is like lighting a match in a crowded room filled with fumes. And we have already seen what that match can do.
Arab Muslim rulers have bought peace at home by exporting their surplus populations and their terrorists to America and Europe. They have spun hateful fantasies about America and Israel to direct the anger of their own citizens away from the government. And we have been paying the price for it. Their artificial stability fuels our terrorism and the rape gangs and murders in our cities. The blowback from their terrorism has rebounded against them before. But always in a limited way. And with plenty of warning. This time though there was no warning. Just an economic tidal wave headed their way.
The rise in the price of wheat has hurt Americans. Particularly working families. But it has hurt the Muslim world far more. With the Obama Administration's continued commitment to ethanol subsidies, wheat prices are likely to keep on rising. And even with a Republican congress, that may not change significantly, because subsidies develop an interest based appeal of their own. Iowa is a swing state and ethanol is big business. The ethanol tax credit and tariff went through the Senate in December at 81 to 19 and 277 to 148 in congress. Throw in a cold winter and wheat prices are only going to keep rising.
In 2007-2008, Egypt saw major food riots break out. As did Yemen, Somalia and Bangladesh. The UN and the Davos summit have already issued urgent warnings about political instability due to food prices. The Islamists and Soros' boys have successfully piggybacked on this year's food riots, making it seem as if they had a massive following in the streets and a mandate for change. They succeeded in Tunisia, but Egypt is still up for grabs. But whoever replaces the dictators will not do any better. The Muslim Brotherhood wants to burqa all the women and start a war with Israel. That will certainly make the average Egyptian temporarily forget about the price of bread, but will make matters much worse.
Pushing women out of the workplace is economically feasible in Saudi Arabia, wallowing in its own oil. It's feasible in generally rural Afghanistan or Gaza which lives off foreign aid anyway. But it doesn't even fly in Iran and would mean economic disaster for Egypt. Cutting ties with America and beginning an expensive war with Israel wouldn't reduce the population much, but would cost a whole lot, and unlike 1967 and 1973, the Russians won't be footing the bill. And what would the price of bread look like then?
The Islamists have two weapons on their side. Oil and the birth rate. But the former can't be eaten and the latter must eat.
Rust, loss of China's total wheat crop, and 1/4 of Russia's wheat crop definitely busted the top out of the price structure.
I agree that it’s a stretch to blame ethanol. However, the rush to crappy fuel at the expense of food certainly did not help. In decades past, when one or two major wheat producers suffered poor crops the others usually made up some of the slack.
That is not true today. While I don’t think it would have prevented what we are witnessing over there it definitely has not helped. Ethanol is crappy fuel and a crappy idea brought to us by the same folks that have promoted hazardous mercury filled lightbulbs, craptastic electric cars, non-performing wind power, and the list goes on.
Can you elaborate a bit? China lost their entire wheat crop?
The Green movement is at the root of many of the financial problems that our country is now facing and the next one looming on the horizon is a self imposed food shortage based on cockamamie green ideas. Burning food in cars is a horrible idea and will most certianly have bad consequences in one way or another.
While I think that ethanol is stupid, ethanol had nothing to do with the rise in commodity prices, it was the weather.
Crops are lost every year but this year China and India have become upwardly mobile and are putting pressure on commodities at the same time that the weather has wreaked havoc on crops.
“The rise in the price of wheat has hurt Americans. Particularly working families. But it has hurt the Muslim world far more. With the Obama Administration’s continued commitment to ethanol subsidies, wheat prices are likely to keep on rising. And even with a Republican congress, that may not change significantly, because subsidies develop an interest based appeal of their own. Iowa is a swing state and ethanol is big business. The ethanol tax credit and tariff went through the Senate in December at 81 to 19 and 277 to 148 in congress. Throw in a cold winter and wheat prices are only going to keep rising.”
WTF? Ethanol is made from corn. We don’t grow wheat here for the most part because we don’t get the snow as consistently as we used to. Well at least till recently anyway. They do some more up north but Iowa isn’t a wheat state. Even in the old days it was on a 3 year rotation. Iowa was never a wheat producer like the plains.
And the truth is so easily seen:
http://www.ers.usda.gov/data/wheat/YBtable01.asp
The other thing that frosts me about this BS is that about 50% of the field corn in the US is used for animal feed.
Which, BTW, how the distillers’ grain left over after fermentation is used: as animal feed, for the same cows.
There is no net loss of “food value” from using corn for ethanol.
You are very incorrect...ethanol is a cleaner burning fuel and engines last longer with it. Henry Ford’s cars were originally built for it mainly...until the discovery of cheap oil. It does have slightly less economy when burned, but there are things that can be done to bring that efficiency up higher. And there is plentiful land for growing fuel...along with vegy oil for diesels. Done on a larger and larger scale, and we will be paying a lot less than gas. electric cars too, with the newer lithium batteries are awesome and much more efficient than a gas engine with incredibly less maintenance. You sound like you earn your living in the oil industry.
You might want to check with your local small engine repairman or marine engine mechanic before u consume anymore of that kool-aide...you're in for a big surprise
The Model T had fuel economy on the order of 13 to 21 mpg The engine was capable of running on petrol, kerosene, or ethanol, though the decreasing cost of petrol and the later introduction of Prohibition made ethanol an impractical fuel. E85 summer blend is 85% ethanol 15% gasoline; E85 winter blend is 70% ethanol 30% gasoline. The use of E85 is low but common in the 12 Midwestern States.
Deporting their citizens and refusing them visas to civilized countries would probably cause revolutions too.
My hope is that if the Muzzies are going to keep their undies in a bunch, that they go find ways to have civil wars and fight oneanother. Keep us the heck out of it!
Ethanol will eventually have residue build up and it’s consistency will lead to a type of varnish. Cannot imagine that will be good for any type of engine.
Ethanol will eventually have residue build up and it’s consistency will lead to a type of varnish. Cannot imagine that will be good for any type of engine.
So I would not trust the story!
2. lack of water for irrigation (see all the canals to major cities)
3. Lack of rainfall in agricultural areas ..blamed on huge areas covered with windmills for electric power generation.
The US turning food into gas has harmed the global food supply. It did not help offset the low production of food world wide right now.
However, all this is a warning to Americans. With the interdependency of the global economic system, no country is in control of their own fates. When we depend upon foreigners for basic necessities we are walking a tight rope of power’s loving kindness and honor. There is no loving kindness and honor in power!
In addition we are asking for rage from foreigners whose politicans can blame others for shortages and create the winds of war and retaliation.
Really? And petrol does not have tremendous carbon build up? Ever seen an engine that runs on gas torn apart after years of sevice? That black carbon is like cement. I understand that alcohol burns much cleaner and I can give you evidence of it’s superiority. Maybe you are the one with the cool aide!
Thank you...how are you? Are you really a cowgirl?
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