When a bad idea for a good cause, is just well..disastrous.


Unusual strains of maize are collected to incr...

The Great Corn Con

By 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.

Corn is hardly some minor agricultural product for breakfast cereal. It’s America’s largest crop, dwarfing wheat and soybeans. A small portion of production goes for human consumption; about 40 percent feeds cows, pigs, turkeys and chickens. Diverting 40 percent to ethanol has disagreeable consequences for food. In just a year, the price of bacon has soared by 24 percent.

Read it all here:

http://www.nytimes.com/2011/06/25/opinion/25Rattner.html?_r=2

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4 thoughts on “When a bad idea for a good cause, is just well..disastrous.

  1. First off, your box of corn flakes, even at $7.00 corn has about 5 cents of corn in it. Most of the cost of a box of corn flakes is tied to transportation, gasoline and diesel prices are driving up the cost of all foods.
    One third of the corn that is diverted to ethanol plants goes back into livestock feed. Ethanol only needs the starch, the rest, protein and minerals, become food to produce that bacon.
    Corn is still plentiful. America’s farmers are producing more corn each year, and they are doing it on less land, with less fertilizer and fewer chemicals than ever before. Technology and better farming methods have increased corn yields from 80 bushels per acre in the early 60’s to 180 bushels per acre today.
    Since ethanol, farmers are making more money, so they need less in price supports for corn production and they are paying more taxes. Jobs, thousands of them, are created here in the U.S. in Middle America ethanol plants so that more people can feed their families and pay more taxes. The price of gasoline is estimated to be 80 cents less because ethanol is cheaper to produce than gasoline. We are importing less oil because of ethanol. Imported oil is jobs overseas in countries that may not even like us a lot, but that we must send our troops over to protect, costing us billions in military spending.
    Ethanol does not pollute the environment if it is spilled.
    The largest effect on corn prices these past years however is that China has been buying corn like never before to feed their growing population of middle class workers. The people in China are no longer content with rice, they want some of that bacon also.
    Your tax dollars return several times over when they are invested in ethanol. Ethanol is still a good idea.

    • We appreciate your thoughtful response and it is wonderful to hear from someone who has more experience with commercial corn farming than we do, but in the interest of fairness, we have to ask: Does your farm receive subsidies for growing corn for ethanol?

  2. There is no subsidy for growing corn for ethanol.
    Due to the increased price of corn there has been no subsidy for growing corn for several years. The producer payments were set up as a safety net to be sure that farmers were able to make a living. Those payments made sure that there was plenty of corn to feed to livestock so that people had plenty of cheap chicken, pork and beef and that industry had corn for production of other products.
    Now that grain prices are high enough that farmers can make payments, those producer payments went away, just as they were designed to do.

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