August 22, 2007 — budsimmons
Ethanol follies (continued)
A policy pushed by liberal elites will end up harming the poor — all for the sake of moral vanity and political correctness.
The Wall Street Journal takes note of articles in Foreign Affairs about the increasing use of corn to produce ethanol, including one by University of Minnesota economics professors C. Ford Runge and Benjamin Senauer (”Using corn as a source of fuel rather than as food will drive up prices of corn and other food staples”) and a rejoinder (”rising prices of yellow corn over the past year haven’t been passed on to U.S. consumers in the U.S. What’s more, farmers in developing countries stand to benefit by reaping bigger profits from their harvests”) by former Senator Tom Daschle.
Daschle is absurd: these higher prices are working their way through the system like a pig in a python. Effects are already being felt by companies that have announced lower earnings and layoffs due to increased materials cost. How does this necessarily help the world’s farmers when politicians have placed tariffs on imports of ethanol to coddle farmers in the grain belt?