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  • Farm bill -- a focus on energy

    January 12, 2007 2:13 PM

    A 2007 farm bill with generous support could run into problems, according to a New York Times article today. But despite possible budget problems, lawmakers and policymakers are anxious to provide generous subsidies for alternative energy sources from crops, such as corn and switchgrass.

    Already, though, there's some evidence that the proliferation of ethanol plants turning corn into fuel is causing the price of feed to rise significantly. That also translates into higher food prices for consumers. In a CEI monograph published last fall, Dennis Avery predicted that a food or fuel problem was likely, especially with government support for energy programs for alternative fuels.

  • France – prime obstacle for liberalizing agriculture support

    January 12, 2007 2:12 PM

    In an opinion piece today in Le Figaro, Drieu Godefridi, director of L'institut Hayek in Brussels, points out that what is halting negotiations on the World Trade Organization's Doha Round is the attitude of French farmers and policymakers — “Libéralisation de l'agriculture: l'obstacle ultime, c'est la France.”

    Godefridi notes that the poor developing countries of the world are the ones who will suffer because they can't effectively compete in world markets with agriculture heavily subsidized in the rich countries.

    He brings up the example of New Zealand, which liberalized its own agricultural policies two decades ago and saw its farmers benefiting. (See CEI's example of New Zealand's cutbacks in agricultural support here, in the context of reforming the U.S. sugar program.)

  • Memo to Sen. Boxer: Be Careful What You Ask For

    January 11, 2007 11:18 AM

    If I were Barbara Boxer, the last thing I want to hear on January 30th when Senators trundle down to offer their deep climate thoughts is the following. As her first act as chair of the Senate Environment and Public Works Committee, Boxer has asked for Senators to offer their take on the horrors of global warming and what they, were they the king that they see in the mirror when shaving, would do.

    Rare are such opportunities. In 500 words someone could do more for the debate than 6 years have done.

    "Madame Chairman, I suggest we vote on the Kyoto Protocol. I have listened for 6 years to rather heated rhetoric about the purported irresponsibility of President Bush for not signing a treaty that was already signed by Bill Clinton, by those who have yet to suggest we vote on Kyoto; I have heard quite stirring claims against chairmen for holding hearings on an issue, from those who now insist that extensive hearings are absolutely necessary and quite simply the responsible thing to do.

  • Meet Modern Britain: Where Blood, Sweat and Tears Is a 70s Rock Band

    January 9, 2007 4:34 PM

    Global warming activists have suggested that Prime Minister Tony Blair give up his personal holiday travel around the world, to set an example as a carbon dioxide conscious citizen. Blair has responded by telling them to bugger off.

    As it turns out, addressing climate change the Blair way won't involve any significant sacrifices for the citizenry, like, say, no longer doing things that cause CO2 emissions. He has cautioned his countrymen not to set "unrealistic targets" in their personal life, adding, "It's like telling people you shouldn't drive anywhere."

    According to his spokesman, Blair believes that policies that end up "hurting the domestic or the world economy" are the wrong way to go. That's good news for the Brits, of course. How a nation like the UK is going to meet its Kyoto obligations without less consumer travel or any negative impact on the domestic economy, however, is still a closely guarded government secret.

  • Scharzenegger to order 10% emissions cut; expected to boost ethanol

    January 9, 2007 12:37 PM

    Gov. Schwarzenegger is expected today to order California's petroleum refiners and gasoline sellers to reduce the carbon content of the fuels they sell by 10%. Cui bono? Can you spell "ethanol"?

    Even with this mandate and the 2002 law (AB 1493) imposing CO2 emissions standards on new cars sold in the state, actual CO2 emissions from California's transport sector are likely to grow. Consider the European experience. Due to high motor fuel taxes, Europeans pay roughly twice what Americans pay for gasoline. Yet from 1990 to 2004, EU transport sector CO2 emissions increased almost 26% and are projected under current policies to be 35% above 1990 levels in 2010. I predict the governator's policy will accomplish only two things--further squeeze California consumers, who already pay the highest motor fuel prices in the nation, and enrich a handful of big ethanol producers.

  • A Temporary Reprieve for D.C. Employers and Landlords

    January 9, 2007 11:20 AM

    D.C. Mayor Anthony Williams rightly vetoed a bill that would have banned employers from taking applicants' criminal records into account in hiring, and forced landlords to rent to ex-cons, even in units near their own living quarters.  But it was one of his last acts as mayor, and the D.C. Council (which includes the incoming mayor) voted for the bill by a veto-proof 10-to-2 margin.  Moreover, the bill was sponsored by William's predecessor as mayor, Councilman Marion Barry, who himself has a criminal record.

    The Washington Post has editorialized against the bill, noting that "under the bill a home health-care agency would have to hire someone who had been freed 10 years ago after serving time for assaulting an elderly woman; a convicted arsonist released from prison 2 1/2 years ago could not be denied an apartment in a five-unit building."

  • Drug Industry Gone to the Dogs

    January 9, 2007 10:42 AM

    My dog is fat. Obese, even, if the FDA is to be believed. The arrival of my new-born son two years ago has meant fewer and fewer long runs on the weekends for me and the dog, as well as more and more table 'scraps' being hand-fed to the pooch by the boy. Tipping the scales at a whopping 90 pounds (or roughly 20 percent) over his ideal weight, BJ needs some help. Fortunately, last week the FDA approved the very first diet drug for dogs -- a Pfizer product called derlotapide, to be marketed under the trade name Slentrol.

    The introduction of a prescription-only diet drug for pets says a lot about a country. (It might suggest a thing or two about me personally as well, but let's leave that for another day.) For example, the fact that Pfizer sees a big enough consumer demand in the United States to market such a product (it's quite dangerous for humans, so there are no reasonable synergies to be had in targeting that very lucrative market) is a rather nice reflection of the success of our mostly free economy. Thanks to capitalism, technology, and industrialization, we Americans are wealthy enough to afford such luxuries.

  • Will the Real Redisributionists Stand Up?

    January 8, 2007 4:25 PM

    The populist rhetoric in the recent elections was widespread. We need to tax the rich and the greedy corporations - take from the rich and give to the poor. But such redistributionist tactics are old hat. The current weather situation suggests a far more innovative approach to this liberal program. I refer, of course, to weather redistribution. Colorado, one might have noticed, had too much snow, while the ski slopes at Eastern resorts were bare. Why doesn't Congress do something about this inequity? Why not charge the Corps of Engineers to move the unwanted snow to where it would be valuable? And, while they're at it, they might shift a little of our recent rain falls to the Western deserts. And, since Canada too is "suffering" from this horrible bout of balmy weather and foreign aid has not been getting a good press in recent years, why not make this redistribution effort NAFTA wide? After all, snowing the public has long been a political passion -- now the politicians can do it with a greater rationale.

  • Can a Deal be Done on Doha?

    January 8, 2007 4:18 PM

    Hopes are rising that the U.S. and the European Union may find ways to work out their differences on advancing more open international trade. Today President Bush met with European Commission President Jose Manuel Barroso, with trade talks high on the agenda.

    After the meeting, both leaders strongly endorsed the need to advance the World Trade Organization's Doha Development Round. Negotiations have been at a standstill since last July, when talks broke down mainly because the U.S. and the EU could not agree on substantial cuts in agricultural subsidies and tariffs. (For CEI's perspective on the talks and the Doha Round, check here.)

    Advancing trade talks is going to take some adroit leadership in both camps. In the recent U.S. elections, scores of candidates from both parties demagogued about the evils of “unfair” trade. Another complicating factor: In the U.S. the President's ability to make deals and ask for Congressional approval up or down — Trade Promotion Authority or fast-track authority — will expire at the end of June 2007. Democratic policymakers, such as Senate Finance Committee Chairman Max Baucus, have said that to renew TPA, more environmental and labor provisions need to be included in trade agreements.

    In the EU, agricultural support is high, and many countries, particularly France, have been notorious in protecting its farmers — and not wanting to budge an inch on giving up those generous subsidies.

  • Ethanol demand will drive grain prices to record levels, Lester Brown warns

    January 8, 2007 3:15 PM

    Lester Brown, founder and President of the Earth Policy Institute, estimates that in 2008, U.S. ethanol distilleries will require 139 million tons of corn -- twice as much as the U.S. Department of Agriculture forecasts. He predicts that "the emerging competition between cars and people for grain will likely drive grain prices to levels never seen before."

    Most ethanol is made from corn, but "as corn prices rise, so too do those of wheat and rice, both because of consumer substitution among grains and because the crops compete for land." A surge in U.S. corn prices will have dramatic effects on global grain prices. Brown explains: "The U.S. corn crop, accounting for 40 percent of the global harvest and supplying 70 precent of global corn exports, looms large in the world food economy. Annual U.S. corn exports of some 55 million tons account for nearly one-fourth of world grain exports...Substantially reducing this export flow would send shock waves throughout the world economy." Brown warns that the ethanol fuel boom imperils the 2 billion poor people in developing countries who depend on grain imports for their survival.

    Brown's proposed alternatives to biofuels -- raising corporate fuel economy standards by 20 percent and switching to plug-in hybrid cars -- have problems of their own. Smaller, lighter cars offer less protection to motorists in crashes, because they have less mass to absorb collision forces and provide less space between the occupant and the point of impact. A National Research Council study found that downsizing, down-weighting effects of current fuel economy standards caused 1,300 to 2,600 additional auto fatalities in 1993.

    Plug-in hybrids -- cars that can operate on rechargeable batteries for short commutes, allowing most people to do most of their driving gasoline-free -- sound like a great idea. But plug-ins are not ready to compete with gasoline-powered cars in terms of either cost, and it is not clear when (or whether) the technical and economic challenges will be resolved. See the testimony by John German of Honda Motors before the House Energy and Commerce, May 17, 2006.

    Brown's concerns about cars and people competing for grain would be better addressed by repealing the ethanol mandate, repealing the federal 51-cents-per-gallon ethanol tax credit, and repealing federal restrictions on domestic oil and gas production.

    Nonetheless, Brown's analysis of the food security risks from federal ethanol policies is worth reading. The complete text appears below.


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