A New York Times editorial today points to the high prices of food — partly spurred by the heavy government involvement in promoting corn ethanol through subsidies and mandates:
[T]he most important reason for the price shock is the rich world's subsidized appetite for biofuels. In the United States, 14 percent of the corn crop was used to produce ethanol in 2006 — a share expected to reach 30 percent by 2010. This is also cutting into production of staples like soybeans, as farmers take advantage of generous subsidies and switch crops to corn for fuel.The Times calls on Congress to get rid of those subsidies “before hunger turns to mass starvation”:
Congress must take a hard look at the effect of corn ethanol on food supplies in the same way the new energy bill requires it to review the environmental effects. It must move toward ending subsidies that will become even more difficult to justify as oil prices rise and the costs of producing corn ethanol decline. And it must press other wealthy countries to do the same before hunger turns to mass starvation.Many readers will recall CEI's prescience in pointing out the resulting problems with fuel vs. food. Read Dennis Avery's warning in a CEI Issue Analysis in September 2006:
The world's 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. The traditional human priorities on use of good cropland start with food. Famine, after all, is a human society's ultimate failure. Tightening the world's food supply by diverting major quantities of its grain stocks into fuels will drive up the prices of all food. This will inevitably hit hardest at the poorest people in the world's food-shortage regions. This would not be ethical even if there were no other sources of energy.Here's what I wrote in another CEI monograph published June 2007 about the unintended consequences of the ethanol mandates and subsidies:
The government-supported rush to ethanol has serious consequences, both domestically and internationally. Chief among these is the threat to food security in the United States and elsewhere. Rising food prices will add to Americans' burden of high fuel costs and especially hurt the poor. The ripple effect of those increases will be felt in developing countries dependent on food imports and could heighten instability in many poor countries already facing food shortages.