Moe Lane

Details here and here: the short version is that the Senate back in June kicked off opposition to continued ethanol subsidies via a bipartisan amendment: it didn’t pass, but Congress has just let both the ethanol subsidy and a restrictive foreign tariff (on Brazilian sugar-cane ethanol) lapse. Given that the Iowa caucuses will be finished by the time Congress reconvenes – and given that the House of Representatives is currently chock-heavy with people who spit at the very phrase ‘ethanol subsidy’ – getting back either is going to be a problem for the domestic ethanol industry. Mind you, there are still mandates for using ethanol in place, but note again the ending of the tariff; I’m not a businessman, but effectively lowering the price of Brazilian ethanol by 54 cents/gallon while simultaneously effectively raising the price of domestic ethanol by 45 cents/gallon sounds to me like it would at least raise some intriguing alternatives. (more…)

I do the food shopping for the family, and I can attest to this personally: prices have been increasing for about a year now.  More accurately, the per-unit prices have increased; the actual vendor’s product typically either has a higher sales price for the same amount of product as a year ago, or else offers less product in order to avoid ‘raising prices.’  I’m seeing more ‘price freeze’ promotions from supermarkets – which means that the supermarkets are just eating the increased costs themselves in order to keep their customer base.

This should not surprise anybody.  We’re deliberately restricting energy production in this country, which inevitably leads to higher fuel prices, which inevitably leads to higher retail prices for everything that relies on fuel for transport*.  We’re also subsidizing the conversion of perfectly good foodstock into a relatively inefficient fuel in order to placate Leftist religious fanatics, and never mind the implications for food prices at home and geopolitical stability abroad.  Right now the major thing keeping this from being a major political headache is because our old – which is to say, pre-2007** – economic model was very, very good at keeping even our poor adequately fed by historical*** standards; we’re still coasting on that.

We might even be able to coast on it until the grown-ups get control back.

Moe Lane

Via Zero Hedge, via Instapundit.

Moe Lane (more…)

It’s quite fun, for given values of “fun:”

• The US Government subsidizes the production of corn-based ethanol, as a substitute/supplement for gasoline.
• To maintain a demand, the US Government pushes for standard gasoline mixtures containing 10% ethanol.  This will supposedly decrease pollution and increase efficiency.
• Corn is then turned into ethanol wholesale.
• Corn-based food prices rise.  That includes critters that eat corn, by the way.
• This results in higher food prices domestically.  This decreases efficiency.
• This also results in more food insecurity globally.
• Corn-based ethanol, being subsidized, crowds out other ethanol fuels.  If this is confusing: please, reference Gresham’s Law, and generalize from its specific example.
• Ethanol, being less energy efficient than gasoline – which is why we weren’t using it to begin with – ends up causing effective inflation, as it costs more to go the same distance in your car.  This also increases pollution.
• In short, 10% ethanol gasoline results in more pollution and less efficiency.
• Therefore, the only solution… is to raise the amount of ethanol in gasoline to 15%.

You have to realize, of course, that darn few DC bureaucrats actually drive anywhere.  And the ones that do rarely pump their own gas.

Moe Lane (crosspost)

Via Instapundit comes this story warning that restaurant food prices are about to sharply rise.  The challenge for the government?  Why, finding who to blame, of course.

After all: can’t blame it on short-sighted conversion of corn crops into ethanol; the government’s pushing for even more use of ethanol, despite the objections of the auto industry.  Can’t blame it on higher gas prices; the government doesn’t really want to explain why it’s put a moratorium on offshore drilling in (disproportionate) response to last year’s Gulf oil spill.  And there’s absolutely, positively, and completely no possible way that this administration is going to let even the hint of a suggestion of an implication of a reference to The Dread Word “Stagflation” escape any lips of any person associated with the executive branch.  If that happens, the President might as well put on a sweater, muck up a hostage rescue, and go get beat up by a rabbit now – just to get it over with.

No, the government’s most comfortable option is, as always, to blame somebody on the Right for all of this.  My guess?  Rush Limbaugh.  He hasn’t been the subject of a Two-Minute Hate recently, and this administration likes to cycle through their favorite targets of those, lest overuse of any one of them makes the whole thing stale.

Moe Lane (crosspost)

Allahpundit calls House Democrats “a gang of cheap losers” for folding like this, and it’s hard to disagree: apparently, all that rhetoric about tax cuts for the rich can easily be trumped with an additional ethanol subsidy.  To which I say, drink deep: because in a world where Al Cubslayer Gore is talking about ending that kind of pork, the odds that it’s going to get renewed by the House next year is dropping precipitously.

Also, out of curiosity: is there anything that a Democratic politician will stand his or her ground on?  I mean, personally I have to take a somewhat detached view about what slop the President has to feed to his pigs in order to get them to stop squealing; the GOP currently has no effective control over that aspect of domestic policy.  Still… there’s more than the slop for Democrats, right? – But if there is, why can’t I figure out what it could possibly be?

Moe Lane (crosspost)

PS: You cannot make me respect someone who will not respect himself.

(Via AoSHQ) Hey, you know that 7.7 billion dollars we’re spending every year on ethanol subsidies?  You know, the pseudo-environmental boondoggle that doesn’t actually do anything except pay off politically important American constituencies and push up food costs worldwide?  The policy that has created yet another set of worthless parasites battening off of your tax money?  Yeah, that program’s up for renewal, so we should kill it.

Isn’t that right, Al Gore?

“It is not a good policy to have these massive subsidies for (U.S.) first generation ethanol,” said Gore, speaking at a green energy business conference in Athens sponsored by Marfin Popular Bank.

The whole thing is fascinating reading: so much so that you have to wonder whether Gore has either been replaced with his Evil Twin, or (more likely) he’s simply heavily invested in second-generation biofuels, which are not made from corn.  If the latter, well, it’d make a certain amount of sense for him to publicly and explicitly no longer care about farmers in Tennessee and Iowa, given that Al Gore is never, ever going to be able to become President ever again…

Moe Lane (more…)