I'm curious, so I'm going to do some research and math on ethanol subsidies.
Looks like the current federal subsidy is $0.52/gallon blended into gasoline. Corn subsidies vary widely. In recent years, they've been something like $3B, so lets go with that. American corn production is, what, 9B bushels? So that's a $0.33/bushel subsidy on corn. 2.5 gallons of ethanol are produced per bushel, so the corn subsidy is $0.132/gallon. Lets assume that ethanol is 75% of the profit of that bushel (since you still get the protein, etc for animal feed), and it goes up to $0.176/gallon. So, since the ethanol subsidy effectively displaces the corn subsidy (the higher corn prices (i.e, the more the demand), the less subsidy is given), lets say that the real effective ethanol subsidy is like $0.34/gallon. The non-subsidized price of ethanol is something like $2.00/gallon to produce, so 17% of the price of ethanol is effectively subsidy. If you don't count the offset to corn subsidies, it's closer to 25%.
Hmm, that's not as much as I was expecting. If I did the math right, that is. Anyone know how much of gas prices are subsidized? I know there are subsidies, but I'm not sure of the scale of them. Darn interference with the free market makes simple cost comparisons difficult. :P
They're actually getting closer to 2.8 gallons of ethanol per bushel on average, and according to the article American farmers grew 10.7 billion bushels of corn this year, down from 11.1 billion last year. They had a bad year. That's the main reason corn prices are climbing.