The Great Corn Con

[n2doc]

y STEVEN RATTNER
Published: June 24, 2011

FEELING the need for an example of government policy run amok? Look no further than the box of cornflakes on your kitchen shelf. In its myriad corn-related interventions, Washington has managed simultaneously to help drive up food prices and add tens of billions of dollars to the deficit, while arguably increasing energy use and harming the environment.

Even in a crowd of rising food and commodity costs, corn stands out, its price having doubled in less than a year to a record $7.87 per bushel in early June. Booming global demand has overtaken stagnant supply.

But rather than ameliorate the problem, the government has exacerbated it, reducing food supply to a hungry world. Thanks to Washington, 4 of every 10 ears of corn grown in America — the source of 40 percent of the world’s production — are shunted into ethanol, a gasoline substitute that imperceptibly nicks our energy problem. Larded onto that are $11 billion a year of government subsidies to the corn complex.

...

Here is perhaps the most incredible part: Because of the subsidy, ethanol became cheaper than gasoline, and so we sent 397 million gallons of ethanol overseas last year. America is simultaneously importing costly foreign oil and subsidizing the export of its equivalent.

http://www.nytimes.com/2011/06/25/opinion/25Rattner.html

[marginlized]

1. And the money just keeps floating to the top... n/t

[truedelphi]

2. And among more ludicrous aspects of this bad policy, the

PR firms hired by the big energy producers use these facts to make it seem that using bio mass from plants is a terrible idea.

Plant biomass for energy is a great idea. But no nation should be so stupid as to use the food part of a plant for its energy.

David Blum has done some great work on how beets are more energy productive than corn - but he is insistent on the waste parts and not the food.

And he is also highly in favor of using Jerusalem artichoke, which is able to grow on land not usually suitable for farming. The Jerusalem artichoke has twice to three times the energy co efficients when compared to corn.

[CrispyQ]

3. The documentary "King Corn" also had some great info on

government subsidies for the corn industry. At the time the movie was made, most corn production was going to feed animals & to be made into HFCS.

Thanks for posting this great commentary.

[RC]

4. No surprise here. This is another money making scam from the Bu$h administration.

[farmbo]

5. Careful... this "ethanol expert" (Rattner) is a Wall Street shark who's been sued by Cuomo

http://tpmmuckraker.talkingpointsmemo.com/2009/04/did_auto_czar_steve_rattner_help_scam_new_york_pen.php

"...In its lawsuit, the SEC alleged that Rattner secured investments for his former firm, Quadrangle Group, after he arranged for a firm to distribute a low-budget film that was produced by David Loglisci, the retirement fund's chief investment officer, and his brothers.

"Steve Rattner was willing to do whatever it took to get his hands on pension fund money including paying kickbacks, orchestrating a movie deal, and funneling campaign contributions," said Cuomo, who is the incoming governor of New York. "Through these lawsuits, we will recover his ill gotten gains and hold Rattner accountable."

Read more: http://www.nypost.com/p/news/local/sec_files_civil_lawsuit_against_o6mz6Ey1g0ljgxFbReErNO#ixzz1QKBiq44z

Why should anyone be listening to this dude?

[Odin2005]

6. This is one of the reasons the Senate needs to be abolished.

It gives far to much power to agribusiness interests because North Dakota and California both have 2 senators.

[guardian]

7. Al Gore agrees

http://www.huffingtonpost.com/2010/11/23/al-gore-corn-ethanol-subsidies_n_787776.html


Al Gore: Supporting Corn-Based Ethanol Subsidies Was A Mistake

Now he tells us. Al Gore says his support for corn-based ethanol subsidies while serving as vice president was a mistake that had more to do with his desire to cultivate farm votes in the 2000 presidential election than with what was good for the environment.

On reflection, Gore said the energy conversion ratios -- how much energy is produced in the process -- "are at best very small." "One of the reasons I made that mistake is that I paid particular attention to the farmers in my home state of Tennessee," he said, "and I had a certain fondness for the farmers in the state of Iowa because I was about to run for president."