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The Ethanol Scam


The ethanol scam just keeps getting more and more absurd. In January, three U.S. senators ­ two Democrats, Tom Harkin of Iowa and Barack Obama of Illinois, along with Indiana Republican Richard Lugar ­ introduced a bill that would promote the use of ethanol. It also mandates the use of more biodiesel and creates tax credits for the production of cellulosic ethanol. They called their bill the “American Fuels Act of 2007.”

The most amazing part of the press release trumpeting the legislation is its fourth paragraph, in which Lugar declares that “U.S. policies should be targeted to replace hydrocarbons with carbohydrates.”

Let’s consider that for a moment. In the 18th and 19th centuries, the U.S. economy was primarily based on carbohydrates. For most people, horses were the main mode of transportation. They were also a primary work source for plowing and planting. Aside from coal, which was used by the railroads and in some factories, the U.S. economy depended largely on the ability of draft animals to turn grass and forage into usable toil. America’s farmers were solely focused on producing food and fiber. And while the U.S. was moderately prosperous, it was not a world leader.

Oil changed all that. After the discovery of vast quantities of oil in Texas, Oklahoma, and other locales, America was able to create a modern transportation system, with cars, buses, and airplanes. That oil helped the U.S. become a dominant military power. Humans were freed from the limitations of the carbohydrate economy, which was constrained by the amount of arable land.

Thus while Lugar and his ilk promote ethanol, they are ignoring a pivotal question: should our farms produce food or fuel?

Last September, Lester Brown, the president of the Earth Policy Institute (a group that promotes “an environmentally sustainable economy”) wrote in a Washington Post opinion piece that the amount of grain needed to make enough ethanol to fill a 25-gallon SUV tank “would feed one person for a full year. If the United States converted its entire grain harvest into ethanol, it would satisfy less than 16 percent of its automotive needs.” Brown said the ongoing ethanol boom in the U.S. was “setting the stage for an epic competition. In a narrow sense, it is one between the world’s supermarkets and its service stations.” More broadly, “it is a battle between the world’s 800 million automobile owners, who want to maintain their mobility, and the world’s 2 billion poorest people, who simply want to survive.”

Using food to make fuel bothers many analysts, and whether their affiliation is liberal or conservative doesn’t seem to matter. Dennis Avery, director of global food issues at the Hudson Institute, a conservative think-tank in Washington, D.C., has concerns that are remarkably similar to Brown’s. A few days after Brown’s piece appeared in the Post, Avery published a paper showing that ethanol simply cannot provide enough motor fuel to make a significant difference in America’s fuel consumption. And like Brown, he laid bare the essential question: food or fuel?

“The real conflict over cropland in the 21st century,” wrote Avery, “will set people’s desire for biofuels against their altruistic desire that all the children on the planet be well-nourished.” He continued, “The world’s total cropland resources seem totally inadequate to the vast size of the energy challenge. We would effectively be burning food as auto fuel in a world that is not fully well-fed now, and whose food demand will more than double in the next 40 years.” Avery says that even if the U.S. adopted biofuels as the antidote for imported crude oil, “It would take more than 546 million acres of U.S. farmland to replace all of our current gasoline use with corn ethanol.”

That’s a huge area, especially considering that the total amount of American cropland covers about 440 million acres.

But the constraints imposed by the amount of arable land in the U.S. are not important to the politicos on both the Left and the Right who insist that America must be “energy independent.” For the apparatchiks who worship at the altar of ethanol, no subsidy is too great, no corn field is too big, as they push their bilge about the perils of foreign oil. None of them bother with pesky facts, like this one: the U.S. was a net crude oil importer way back in 1913. In fact, since 1913, the U.S. has been a net crude oil importer in all but nine of those years.

Thus, while farmers, politicos, and Big Agriculture insist on casting the ethanol scam in terms of national security, the evils of foreign oil, and the benefits of ethanol to rural communities, the larger issue is a moral one: are we going to use our precious farmland to grow food, or are we going to subsidize the growth of an industry that turns food into a commodity, motor fuel, of which we already have an abundant supply?

The answer should be obvious.

ROBERT BRYCE lives in Austin, Texas and managing editor of Energy Tribune. He is the author of Cronies: Oil, the Bushes, and the Rise of Texas, America’s Superstate. He can be reached at:



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