The Corn-Ethanol Industrial Complex
Submitted by CARPE DIEM
FORBES — Ethanol, once heralded as the homegrown Nicorette gum of America’s oil addiction, is getting a second look from lawmakers suddenly concerned about the unintended consequences of merging the fuel and food markets.
Thanks in part to a wave of well-intentioned Washington policies, corn previously consumed by just people and animals now feeds cars as well. The goal of the government’s Renewable Fuels Standard is for 9 billion gallons of renewable fuel to be produced this year–legislation calls for 36 billion gallons by 2022.
In addition to the goals of the Renewable Fuels Standard, blenders–who help create the stuff–receive a 51 cent-per-gallon tax credit, increasing profits and the amount of ethanol they produce. The industry is further buoyed by a 54 cent-per-gallon import tariff, which limits competition from foreign ethanol producers.
No wonder more and more of the corn harvest is headed for your car (see chart above), and the cost of bread is on the rise.
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