Quote of the Day: Ethanol Mandates Are Immoral
"There are lots of stupid federal programs. There are lots of wasteful federal programs. The corn ethanol mandates are immoral."
~Robert Bryce writing in the Energy Tribune
HT: Nick Schulz
CARPE DIEM
Professor Mark J. Perry's Blog for Economics and Finance
Saturday, February 13, 2010
~Robert Bryce writing in the Energy Tribune
HT: Nick Schulz
About Me
- Name: Mark J. Perry
- Location: Washington, D.C., United States
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
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22 Comments:
Robert Bryce depending on a raving moonbat for his supposed facts makes the whole Bryce rant questionable at best...
I'm sure there are more valid reasons not use ethanol for fuel besides the alledged inability of feeding 330 million people who should be feeding themselves...
Ethanol mandates are the direct result of Iowa having the first presidential caucus. Change that and political support for ethanol will plummet.
Take away "goberment" subsidies for ethanol and it would not stand on it's own merits! That fact should suffice to stop this inefficient engine destroying rent seeking industry. Case Closed!
The immorality of the ethanol mandate is not primarily its diversion of corn away from food. That is simply an effect of the mandate.
More fundamental is the immorality of government intrusion into economic transactions at all. Mandates of this sort turn the moral justification for the existence of government on its head by changing institution created for the protection of individual rights into a violator of rights--in this case, violation of liberty and property.
I like Beth's point of view!
more people means more starving people
family planning is the best solution
You will always find someone to advocate the other side. You can argue that ethanol mandates are a good thing. I'm sure many do.
That is the basis of our whole legal system
Not really a search for truth
Just a competition in persuasion
Poor people Do Not, and Never Have eaten field corn.
Poor cattle eat field corn, and are, in turn, eaten by Rich People.
We planted 5% Fewer Acres of Corn in '09 than we did in '07.
Corn costs a little over $0.06/lb, today.
YOU try growing Corn for less than $0.06/lb.
You can have ethanol delivered to your station, anywhere in the Midwest for about $1.70 gal.
That is Before any subsidies/tax credits have been applied. This means you can add state, and local taxes, plus a reasonable profit, and sell Ethanol for $2.15, or so, a gallon. With NO subsidies/tax credits, Anywhere.
There's a Very good chance you'll see gasoline well above $3.00 gallon this summer, and that ethanol will be about the same as now.
You want "immorality?" Check back in 2012, and you'll probably see a whole lot of Immorality. Don't believe me? Check out the "Megaprojects" data on new oil fields, and the data on "decline" from existing fields.
Oh, btw; the "offshore" storage from which we've been getting a Million Barrels/Day. It'll likely be empty by July. Enjoy
And, btw, there is absolutely no way in the world that you can tie field corn in the U.S. (we had a very nice harvest, and record exports that year,) with
Drought in Australia, and Argentina, bad export/import policies in India, Egypt, Mexico, China, and a poor rice harvest in China.
And, Mexican Tortillas are made with White Sweet Corn, not Yellow Field Corn, and the Mexicans still had Import Controls on our corn at the time, and there was NO trade between us and Mexico in Yellow Sweet Corn, anyway. And, they sure as Dickens couldn't export field corn to the U.S. They would be nowhere near competitive.
Lester Brown wants to pare the world's population down to a half a million, or somesuch. He's a total loonytunes.
I can't believe you'd post such nonsense.
US sugar prices higher than World sugar prices - immoral?
CO2 regulated by the EPA - immoral?
These are just a couple of examples of government policies to enrich a few at the expense of the majority.
We need a true free market to set prices.
What Beth said!!
My vote for "Immorality" would be fighting endless wars in the Middleeast for a product for which we can supply a substitute at home, but that the oil companies Won't Distribute sans "mandates."
Go ahead, tell me how many hungry people we could feed with the $150 Billion, plus, we are spending in te Middle East.
How "immoral" is the 15% Oil Depletion Allowance?
A Major Oil Company is buying ethanol for $1.70/gal, taking the $0.45 Tax Credit (now, we're down to $1.25,) paying the Alabama, and Fed Taxes (now we're back up to about $1.60 gal, I guess,)
And, selling it for $2.40 Gal. (Don't believe me - go over to the EIA website, and check out the "Rack Prices" per state.)
Why? Because they have a Lock on the Distribution.
Got any good "Morality" arguments for That One?
About that $150 Billion. Do you know what you could buy with it?
Just about ALL of the Food Grain Crops produced in North, AND S. America.
Or, you could build enough biorefineries to replace Every Single Drop of Imported Oil we use.
But, then What would we do with our $150 Billion, Next year?
Rufus, get real, a lot of money will continue to be spent on police, military, security at firms, households, etc. I know you won't get rid of your keys and other security systems. Protection from criminal activity or worse is not immoral.
Also, I may add, do you want a madman and his two sons, sitting on trillions of dollars of oil, who used chemical weapons before, started wars in Iran and Kuwait, killed more Middle East people than anyone in history, and created an enviornmental disaster burning oil fields, while thumbing his nose at the UN and the civilized world for over a decade to continue his regime.
Or want fanatics willing to kill as many innocent people as possible, including through weapons of mass destruction, so they can go to heaven. Or a nuclear arms race in the Middle East, etc. How many 9/11s should there be?
Oil is a cheap form of energy. It's unfortunate the world has been prevented from buying oil and peaceful people have been prevented from selling oil by a bunch of criminals and fanatics. So, we have to rely on expensive alternative energy.
Ethanol consumption is indirectly proportional to dependence on foreign oil. Brazil has been considered to have the world's first sustainable biofuels economy. Corn is not the only source of ethanol. So many health problems (obesity, diabetes) are directly related to corn-HFCS and sugar consumption) - it would do us good to cut food consumption of it anyway. Brazil is smart and already took the initiative. American entrepreneurs are following suit. The corn subsidy mandate is sideshow. Get a more complete story of the matter at Wikipedia - search for Food vs. Fuel.
If corn based ethanol is that cost effective, then think how much we could save if we dropped tariffs on the cheaper alternative sugar cane!
The last I looked that super-dooper efficient Brazilian Cane Ethanol was selling at the dock in Brazil for $3.62/gal.
Our corn ethanol was selling at the dock on the Gulf Coast for $1.90/gal.
Have at it.
btw, that import tariff doesn't apply to the first 700,000,000 gallons, and that threshold hasn't been reached yet. Import away.
Ethanol production is the product of simple numbers and "Not In My Backyard" politics.
Anyone who wants to replace ethanol production with gasoline needs to find the locations to construct the new oil refinery capacity to offset the ethanol taken from the market.
What would their estimates of investment requirements be?
It's nice to talk about "feelings" but a simple plan will help everyone understand the "problem".
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