Posted on 08/31/2007 7:53:42 AM PDT by hedgetrimmer
In the down-is-up world of American biofuels, success carries enormous costs.
The latest evidence of these costs is an amendment tucked into the House version of the 2007 Farm Bill: As Mexican granular sugar flows into the U.S. in 2008, the U.S. Department of Agriculture will oversee a supply-balancing program where the extra sugar can be purchased, at government-subsidized prices, by American ethanol makers.
Sweet, eh?
Moreover, if you think American corn growers are angered by seeing part of their fast-growing ethanol market legislatively handed to imported sugar, think again. Ethanol, after all, is the rabbit hole that swallowed logic and economics long ago.
When passed in 1993, the North American Free Trade Agreement gave the U.S. a 15-year reprieve from unrestricted, low-cost Mexi-can sugar exports. The Mexicans hated the delay, but it was a key compromise cut by both Presidents Bush (I) and Clinton to get NAFTA through Congress.
During the resulting moratorium, however, U.S. high fructose corn syrup - made from taxpayer-subsidized, cheap American corn - poured into Mexico to replace that nation's granular sugar in much of its soft drink industry.
Now, 15 years later, the piper must be paid.
Or, as Phillip Brasher of the Des Moines Register noted in his late-July story on the Mexican sugar dance: “Yes, high fructose corn syrup will be sent to Mexico to displace the sugar that will then be shipped to the United States. Taxpayers can then pay for buying surplus sugar and converting it to ethanol.”
The U.S. sugar industry doesn't explain the swap so starkly.
To it, the House plan is an extension of current sugar import policy - a tangle of mandated, USDA-administrated quotas, tariffs and loans - that protects American producers from a tidal wave of vastly cheaper imports.
In short, the fact that we have a domestic sugar price support program (as do most nations) leads us to need another program to handle the 2008-and-thereafter unrestricted Mexican imports.
“If this provision were not in place,” explains Phillip Hayes of the American Sugar Alliance, “there could be very costly, massive domestic (USDA loan) forfeitures by U.S. sugar producers.”
But avoiding those potential forfeitures by directing subsidized sugar to ethanol makers won't be cheap either.
Although the Congressional Budget Office doesn't break out the exact cost of “Feedstock Flexibility Program” - the official name of the sugar idea - it estimates the House Ag Committee's 2007 “bioenergy program... would increase that program's direct spending by... $3.1 billion over the 2008-2017 period.”
All of this is too much for Dr. Thomas Elam of FarmEcon.com, a food industry consulting firm in Carmel, Ind. Recently, Elam wrote a commentary that called today's subsidy-dripping biofuel policies self-defeating.
“(G)rain-based U.S. fuel ethanol production,” wrote Elam, “is using an increasing amount of our global food supply, increasing the global costs of food production and contributing almost nothing to U.S. or global net energy supplies.
“In effect,” he continued, “by linking food and energy costs through grain-based ethanol, we have ransomed our food costs as well as our energy costs to the interests of global crude oil producers.”
A believer in “free trade and free markets,” Elam, in an Aug. 21 telephone interview, characterized the sugar-to-ethanol idea as “insane.”
But, he adds with a hint of sarcasm, “I've been waiting for ethanol makers to ask for more subsidies because of the high price of corn due to their ethanol making.”
Not surprisingly, Elam's commentary, a variation of which is at: http://farm
econ.com, has not been received well by the ethanol-fueled ag lobby.
“In fact, you're the first person to call me about it,” he notes.
Welcome to a really small club, Doc. H
PING
Remember CAFTA and the sugar debate?
I can’t believe there are people here who still defend the ethanol scam. Either they are brain dead or they benefit from it.
Jeb Bush is positioning himself, with the help of his brother’s ethanol plan, to make himself a billionaire.
Sure do.
I want someone to find that dang book where it is written that we owe our soul and wealth to 'those south of the border'.
Robert Pastor wrote for the Jimmy Carter Center, in 1989 that we owe our souls to Mexico and the South. It’s why he helped orchestrate the ‘dirty wars’ in South America, he use it as a study on how governments and societies are overthrown. He has brought his expertise to the US now, and we are seeing the fruits of his career.
Only a little bit. LOL
could we not just eat the sugar?
dump fructose and use sugar cane.
And some people want to Feds to run healthcare, too.
And just what was his reason for that silly conclusion?
ARTIST: The Guess Who
TITLE: No Sugar Tonight/New Mother Nature
Lyrics and Chords
[ D* = xx0030 ]
Lonely feeling, deep inside
Find a corner where I can hide
Silent footsteps crowding me
Sudden darkness, but I can see
/ D* D D* D / / / /
{Refrain}
No sugar tonight in my coffee
No sugar tonight in my tea
No sugar to stand beside me
No sugar to run with me
Da do da da...
/ D C / G D / :
In the silence of her mind
Quiet movements where I can find
Grabbing for me with her eyes
Now I’m falling from her skies
{Refrain}
Jock says yes, and I believe him
When we talk about the things I say
She hasn’t got the faith or the guts to leave him
When they’re standing in each other’s way
/ D7 - / / / /
You’re driven back now to places you’ve been to
You wonder what you’re gonna find
You know you’ve been wrong but it won’t be long
Before you leave ‘em all far behind
{Second Refrain}
‘Cause it’s the new mother nature taking over
It’s the new splendid lady come to call
It’s the new mother nature taking over
She’s getting us all, she’s getting us all
/ G7 D7 / / / CD CD /
Jock said no when I came back last time
It’s looking like I lost a friend
No use calling ‘cause the sky is falling
And I’m getting pretty near the end
A smoke filled room in a corner basement
The situation must be right
A bag of goodies and a bottle of wine
We’re gonna get it on right tonight
{Second Refrain}
Lonely feeling
Jock says yes and I believe him
Deep inside
When we talk about the things I say
Find a corner
She hasn’t got the faith or the guts to leave him
Where I can hide
When they’re standing in each other’s way
Silent footsteps
You’re driven back now to places you’ve been to
Crowding me
You wonder what you’re gonna find
Sudden darkness
You know you’ve been wrong and it won’t be long
But I can see
Before you leave ‘em all far behind
{Second Refrain}
Da do da da...
The public is woefully uneducated and therefore gullible and will follow anyone with enough guile to tell them a pleasant lie. We have been sold on global warming and told we can't drill for oil by environmentalists who have used fear to trump logic. Very few will benefit and that's exactly as it is planned.
Bad move for the Mexicans. I'm one of those who believe that the use of high-fructose corn syrup is the single biggest contributor to American obesity over the past 30 years. I rarely drink soft drinks, but when I do, I buy them at Mexican stores because most of them use real cane sugar and taste soooo much better.
His early policy making ideas were learned at a communist front group -—some international economic NGO of some sort.
—snickering and giggling as I repeat that in my many trips to corn country, I see almost no evidence of usage of ethanol or bio-fuel in the cultivation, harvest or processing of corn-—
The reason we have a domsetic sugar industry is because WWII casught us cut off from sugar and it had to be rationed. There are lots of South American countries who want to sell us ethanol from sugar which is cheaper. That will argue for reducing the protective tarrif on corn ethanol set to expire in 2010. However, we could end up dependant on foreign ethanol and subject to the political instabiity of South American regimes. Is that any better than depending on foreign oil?
No, we have to prop up certain industries at the expense of consumers.
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.