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Momma said wonk you out

ASSIGNMENT DESK: OBAMA AND ETHANOL.

corn1.jpg

Fred asks, "Pretty much everyone understands that ethanol from corn has been a horrible policy to promote and has caused more hunger and suffering through worldwide higher food prices. My question is: Why is Obama still supporting subsidies for ethanol?"

In a word? Illinois. Obama is still the junior Senator from Illinois, which is second only to Iowa in corn production. And yeah, that would be the same Iowa that holds the first-in-the-nation presidential caucus where Obama's campaign rocketed into the lead.

Much like Obama's previous support for liquefied coal, which would've helped hometown miners at great environmental cost, this is the sort of parochialism the Senate -- and the Iowa Caucus -- encourages. When ethanol is important to a state economy, it becomes magically important to politicians who want to win elections in that state. A recent New York Times article outlined some of Obama's resulting links to ethanol, though it occasionally got a bit absurd: Sen. Daschle may help ethanol lobbies, but he's talking to Obama about issues that actually interest him, like health care, not trying to convince him to push corn subsidies.

Obama, at times, has been pretty honest about what's behind the curtain: "Look," he said, "I've been a strong ethanol supporter because Illinois ... is a major corn producer." That's a more straightforward accounting of the political economy than we got before the presidential campaign, when he told Grist, "when it comes to oil, at least, oil producers are in a position to lower and raise prices pretty drastically in response to competition. Take solar power, or wind, or cellulosic ethanol -- all those energy sources, if oil stays at $60 or $55 a barrel, are competitive. If they really start to threaten oil, Saudi Arabia could easily flood the market sufficient to drop oil down to $25 or $30 per barrel. So it's not a perfect market." Oil, of course, is around $140 a barrel now, and Saudi Arabia isn't showing itself particularly able or interested to pull that back down.

All that said, ethanol subsidies aren't a particularly large portion of the Obama energy plan. The bigger problem is that Obama supports the 45 cent tariff on Brazilian sugar cane, which is about four times more energy efficient than corn as an ethanol base. But that tariff isn't going anywhere no matter who gets into office. More broadly, the hope is that after the campaign, the parochial pressures that currently push Obama towards support for corn ethanol will be considerably less powerful. We'll see. In the scheme of things, though, subsidies -- or tariffs -- for ethanol are much less important than caps on carbon. The bigger lesson here is that Obama is still a politician, and responds to pressure from various constituencies, and will need to be pushed -- rather than trusted -- to do the right thing.

Image used under a Creative Commons license from Snake.Eyes.



COMMENTS

In a word? Illinois. Obama is still the junior Senator from Illinois, which is second only to Iowa in corn production. And yeah, that would be the same Iowa that holds the first-in-the-nation presidential caucus where Obama's campaign rocketed into the lead.

Good GOD, Ezra! All you are doing is apologizing for Obama's position when the facts are clear that ethanol production causes misery throught the world in higher food prices. You present this as if he had no choice. That is the difference between a statesman and a politician. Obama is a politician and selfishly lies to each group, telling them what they wish to hear. And here, for comparison, is a statesman:

"In 2000, McCain ran for president and reiterated his longstanding
opposition to ethanol subsidies. Though it crippled his chances in Iowa,
he argued that ethanol was a wasteful giveaway. A recent study in the
journal Science has shown that when you take all impacts into
consideration, ethanol consumption increases greenhouse gas emissions
compared with regular gasoline. Unlike, say, Barack Obama, McCain still
opposes ethanol subsidies."
http://gregmankiw.blogspot.com/2008/02/mccain-vs-obama-ethanol.html


The left no longer supports ethanol but the darling of the left is still a whore politician just like McCain and Bush and Clinton and every other politician who has been successful enough to gain real power.

El V - Your example only reiterates how easy it is to oppose ethanol when so little corn is grown in Arizona. How "statesmanly" has McCain been on Arizona's parochial interests?

This ethanol issue appears to be a lot more complicated than is generally understood. The US farmers don't appear to care too much how the corn is used (recognizing that different corn strains are used for human food, animal feed and ethanol stocks), but that their farms are financially solvent - meaning that they have a market for what they grow that will pay them for their costs and some profit.

I read yesterday (somewhere) that a farmer had to pay in the $4-5000 range to fuel up his brand-new monster harvester! The oil price crisis (and its effects on fertilizer) endangers their livlihood. One commenter said that local ethanol plants were springing up just to supply the fuel needs of local farmers are prices they could manage.

So, yeah corn-ethanol is a bad way to make automotive fuels, but it isn't just pandering of the usual variety to support corn-ethanol in the midwest while not dealing with the bigger picture of fuel and fertilizer's impact on the farm economy.

Whatever crop is grown, and for what purpose it is purchased makes a huge impact on whether these folks (who value their land, way of life, and responsibility to their own posterity) can make a living.

Moral of story: you can't snatch one part of the energy puzzle out and find a fix for it, ignoring the bigger picture. Solutions and work-arounds will require major planning and investments for decades ahead, and the USA is anything but a planner and long-range investor. I liked this quote: "If you fail to plan, then you plan to fail"

BTW we should despise our own politicians. Because of the process there are very, very few with any good character that get anywhere. Republicans should despise Republican politicians and democrats should despise democrat politicians. People should not be fooled by McCain’s maverick brand nor by Obama’s good nature and personality. Perhaps the politicians like Bill Clinton who are very obviously whores to almost everyone are the best we can hope for. The Bill Clinton’s attract very, very few true believers.

Yeah ethanol politics are really a huge mess. Like a lot of our corn subsidies, it's got all sorts of ill effects both at home and abroad. And yet there is virtually no way to continue to get elected without supporting them. We supported them for FAR too long as a way for liberals to appeal to "heartland" constituencies. It was one of the major examples of how environmentalism didn't have to be an economic threat. It'll be incredibly hard to turn back on that now.

That's particularly true in Illinois, where the Democratic Party faces such a major uphill battle winning rural votes because it's so closely associated with the Chicago machine. That struggle is only going to get worse in the next election given Blagojevich's spectacularly poor handling of the state. As long as the Illinois Democratic party doesn't have spare political capital in rural areas, it'll be hard for it to move against ethanol.

It's also interesting to see sugarcane touted as the next major source of ethanol production. Americans don't particularly like the process of sugar production because it has its own unsavory environmental impacts. See the long-running disputes between sugar producers and Everglades conservationists in Florida. It's hugely unlikely that we're going to increase sugar production in places like Louisiana or Florida, where the existing capacity is already sitting on top of sensitive and protected ecosystems. So the other option is just to rely on yet another imported energy source that needs tons of energy to even reach your tank.

@JimPortlandOR
http://www.extension.iastate.edu/agdm/articles/duffy/DuffyMar00.htm
Table 1 shows that a 59 percent increase in the cost of diesel fuel would increase the cost of production by about 1 percent. If we don't include land costs, the increase would represent an increase of approximately 2 percent. These cost increases are fairly modest. However, they represent only the short run increases.

Here's some lengthly comments from on part of what France and Germany are doing - as a vivid contrast to the US.

--------------

AlanfromBigEasy on July 7, 2008 - 6:29am
[quote:]

from an appendix of an upcoming article:

France – A Comprehensive Non-Oil Transportation System

• High Speed Inter-City Rail
• Inter-City Freight Rail
• Urban Rail
• Bicycles
• Walkable Neighborhoods

President Chirac made it a national goal to electrify “every meter” of the French National railroads (SNCF) and “burn not one drop of oil”. This goal was set on January 1st, 2006 with a twenty year deadline.

France has been building their famous TGV lines for over 30 years, one line at a time. Now that the original Paris-centric system is 100 km from completion, a new network of additions, bypassing Paris, have been announced and, for the first time, three different TGV lines are simultaneously under construction.

France has had an aggressive tram (Light Rail) building program for over fifteen years, with only five French towns of population 100,000 or more without a tram or plans for one. Recently, France has stepped up the pace with plans for 1,500 km of new tram lines (22 billion euros) in the next decade.

And velibs. Rental bicycles scattered all over in almost a dozen French cities, typically with the first half hour free. Many more bicycle paths and lanes have been built in recent years. The stated government objective is to ensure that 10% of in-town journeys are made by bike by 2010, but the results are trailing plans with only 3% in 2007. However, Portland Oregon and Davis California are the only US cities that exceed 3% AFAIK.

Mulhouse France (population 110,900, metro 271,000) illustrates just how comprehensive the French program can be in a best case. This remote town where France, Germany and Switzerland meet, got it’s first tram (Light Rail) line in 2006. By 2012, they will have 58 km (34 miles) of new tram lines (they would also have had a tram line to Basel Switzerland if Franco-Swiss co-operation had been better).

In 2011, Mulhouse will be the temporary terminus of a new TGV line and 200 velibs (rental bicycles with the first half hour free) have recently been installed.

The end result is that by 2012 a resident of Mulhouse can walk out their door, grab a velib rental bicycle, drop it off at the tram station or just walk, take the tram to the TGV station and be in Paris in 4 or so hours, and anywhere in France in a long day, all with a drop or two of lubricating oil and minimal carbon footprint.

In the non-transportation area, France is installing large numbers of solar hot water heaters and geothermal heat pumps.

With significant difficulty and economic loss, France could adapt to a prolonged loss of a fraction of their imported oil.

[end quote]
------------
AlanfromBigEasy on July 7, 2008 - 6:30am
[quote]

Germany, -18% from peak oil use (as of 31/12/07), -9% 2006 > 2007.

Best home insulation standards, #1 in wind and solar (despite modest natural resources), Expanding ICE network. Increased use of rail & barge vs. trucking. Likely new coal plants instead of new nukes :-( and increasing gas use to offset reduced oil use.
[end quote]
---------
Euan Mearns on July 7, 2008 - 7:28am
[quote]
Alan - ditto above. Here's the oil consumption change from 06 to 07:

usa -0.1%
can +2.7%
fra -1.7%
ger -9%
ita -3.9%
uk -5%
jap - 3.5%

Germany are clearly achieving great savings - I wonder if this has anything to do with € strength. One problem here with German oil consumption down so much over 2 years is to ask for how long they can sustain that - cos once the European consumption stops falling that will put even more pressure on price. I wonder also if an element of German figures includes deindustrialisation. Its the shocking N American figures that must be the greatest source of concern - Canada with all the hall marks of an energy export land.
[end quote]

if the united states had the political will and leadership, would it be possible to decide on one kind of technology for cars, create an infrastructure of stations to power them and then phase out the manufacturing of conventional cars within a ten year period?
a kind of huge national initiative?
with rebates, subsidies and financial easements given to families through taxes and other methods in conjunction with washington and the automotive industry for buying new technology cars, couldnt this be done as a national initiative?
wouldnt this create more jobs in detroit and be a source of economic stimulation and liberate us from our oil dependence?
we have been able to spend billions of dollars on presidential campaigns, wars, mercenary forces....why cant we have a ten year transportation and energy initiative?

Ha ha ha, people still think cars are the answer.

of course, i dont think that cars are the only answer.
i think that a commuter and long distance train link throughout the united states, with new and independent trackage is essential, along with a network of shuttles in town and cities, and other initiatives also.
but people will still have cars, and going to a universal, cleaner technology is vital, also.

France currently gets about 80% of it's power from Nukular power plants.

Why isn't Obama on board with this as well? You like France, don't you?

@jacqueline
Of course, but it's not just a question of political will.
Every time someone proposes options like this (or even less invasive/proactive ones) the kneejerk reaction, especially on the right, is "It's bad for business."
Of course, what they really mean is, "It's bad for the status quo."
That's not to say that there aren't things that are truly bad for business. The long term effects of global climate change are probably truly bad for business, for example. But changing the incentive structure (for instance: cap-and-trade with full auction) is not actually bad for business. In fact, it would stimulate all kinds of new technology growth -- which is exactly what the status-quo profit-makers are worried about. Their revenue streams rely on being sure that NOTHING CHANGES.
So, yes, we could enact what you proposed, and a hundred other things too. But that would threaten the entrenched corporate interests that OWN our government, and so they will fight it tooth and nail.
In short, nothing will change until profits are actually threatened by climate change, or until we boot corporations out of our legislative process and take back our republic.
I love your optimism though.

@JimPortlandOR Mass transit

Is Government, as they run it today, a net helper or hurter of mass transit

http://www.econtalk.org/archives/2008/07...
In 1975, built a subway, metro system, one of the biggest in Latin America. Santiago not quite as dense as NYC but close. On the surface, had a private bus system. No public subsidies, but system operated in the black. Consertacion [Consertacion Nacional Democratica, political party] looked at that and saw profits. Took a system that was $60 million per year in the black; now it loses 10 times more than it was making. How many passengers? Ridership has gone slightly down. Could argue that they were catering to mostly the rich, and by publicizing they would serve a larger audience. There had been different classes of service--now everybody has the same class of service. Commute times tripled, which is why people stopped using mass transit. Now people use cars. People didn't move out or stop working; they are driving cars on crowded streets. Key difference in the routes: used to be redudancy in the system. Always possible to get to work on time, and low variance. Now up to 2 hours but it may take 4 hours.

bus is losing $100/per person per year, for the privilege of not riding the bus. President has said "We owe the people of Santiago an apology, particularly the poor people." A lot of people actually lost their jobs. But less inequality, so happier.

Proportion of ridership from large companies? Probably mostly from a few largest companies. 4.8 million are from areas around Santiago areas. Express buses without stopping even with amenities like food and coffee; plus local buses that stopped at every corner.


BTW safe motorcycles/motorscooters (see bmw c1 200) may be a great option to reduce congestion and fuel consumption.

in the early 1980s, as i recall, harper's magazine had an issue all about recombinant energy. it was, for me, the first time that i really read anything about energy alternatives.
i think that tucked between the articles, was the following small essay, written by someone named david suter.
i have saved this little essay, over the past twenty-seven years because i thought it was so prescient and incredibly poignant and brilliant.
the page is very old and faded after all of these years, but before the article is lost in time, i would just like to share it with others.
as i was reading about the solar orchards that boone pickens is developing, it reminded me of my treasured article.
perhaps other readers will appreciate it also.

other things being equal
utility

"this is the solar orchard, where trees change sunlight to electricity.
unlike the old mechanical solar collectors, green leaves track and store the sun's energy as a matter of course.
to burn such complex and delicate structures for food or fuel seems wasteful; what was needed was direct use of the energy of photosynthesis without the death of the plant.
late in the century, a geneticist bred an elm leaf with a charged ,siliceous organ analogous to the electroplaque tissue of the electric eel. connected in series, the mature elms yielded a strong current in daylight, and the technique was soon adapted to other species.

the popular cultivation of photovoltaic palm, ofr example, has brought hanging gardens back to the near east, while low-voltage evergreens cloak europe in a new black forest. there has been commensurate political change, the tropics having regained their old wealth as the sunless polar nations sulk and plan invasions...

sometimes, on cold nights when dry air insulates the glowing trees, i walk carefully through the town orchard. this clean energy, i believe, exacts a subtle price; between the hum of transformers and the crackle of lasing chloroplasts there is a curious whisper of wind in the leaves, a voice from their innocent, useless past."
~~~~~david suter

(the author also creted a beautiful illustration with this, of a woman with a horse, under ancient elms, linked by transformers, gathering small light bulbs, like acorns, from under the trees.)
thank you for your patience. i think this is very poignant, and took the liberty of sharing it with everyone here.

Off-topic, but is anyone else irritated by all the HDR images on Flickr? The first few look kind of cool, then you see how overused the process is and you think 'enough already, can't anyone just take a frigging picture?'

The only ecologically sound part of the entire US Energy policy, and supporting the barrier to ethanol imports is somehow a problem?

Is this the problem when a wonk without the time to dig deeply into an issue gets hold of a facile talking point like "four times more energy efficient" ...

1. It's imported biofuel. The US has in the neighborhood of twice the biocapacity per capita as the world average. If we aspire to developing a system that people are going to be imitating ... where is the world going to import biofuel from once "everyone starts doing it"? Earth Two, perhaps?

2. What about the climate crisis? Domestic ethanol in Brazil is already displacing crop and livestock production into deforested areas that were once part of the Amazon Rain Forest ... what happens if there is a hard currency market for the stuff? Its not like Brazil has shown much reluctance to burn down the Amazon when there is hard currency to be made doing so.

On the bright side of the ethanol policy, the high domestic costs of grain in the US as a result of the ethanol policy has meant a lot less dumping of US grain into the markets of low income nations, which is a practice that has causes a tremendous amount of misery and starvation around the world.

Of course, the policy of boosting Monsanto/ADM profits while killing off domestic production of food in low income nations does not make the headlines, because the damage is done out in the countryside, and the reports tend to come from the cities.

I have watched and listened and the mantra seems to be "yeah, but we fogive him".

Forgive him for the abortion flip-flop, the war flip-flop, the FISA flip-flop, his terrible position on ethanol, and many, many other issues in which he really fucked he left.

"But...but...but He's BLACK..."

@El V:

I'm not sure how many times we have to say this, but it's only a "flip-flop" if you change stances.

He's pretty much always been very centrist, and has certainly never been anywhere close to leftist, so the notion that he lied to you all and then "fucked" you by flip-flopping is pretty lol.

Did it ever occur to you that he one the nomination precisely because he's not that far left? I voted for him, and the fact that he's centrist doesn't keep me up at night.

Sorry about your buyer's remorse.

Posted by: Patrick Minton | July 8, 2008 1:23 PM:

@El V:
I'm not sure how many times we have to say this, but it's only a "flip-flop" if you change stances.

Precisely ... members of "the left" (whatever that is, precisely) only have themselves to blame if they convinced themselves that Senator Obama was some progressive folk hero because he emphasized some mildy progressive parts of his platform during the primary and now he emphasizes some right-of-center positions that he's held all along.

Iraq: no flip, same position as he repeated constantly.

FISA: not really a flip, he always made the lack of court scrutiny the foundation of his opposition and always accepted the Potemkin FISA Court as if it was real court scrutiny.

Death Penalty: the same position as in Audacity of Hope.

Ethanol: same position since his Senate Run.

The biggest flip he's done is really his abandonment of support for Coal To Liquid technology, and that, of course, is a good flip.

I do not support many of those centrist positions, so I did not support Obama in the primary. I prefer them to McCain's most recent positions, as well as the majority of the range of positions that McCain has had on most issues over the last couple of decades, so I will vote for Obama in the Fall.

But people who talked themselves into believing that Obama was some massive left wing liberal based on things like a voting record in a Senate where genuinely progressive legislation rarely reaches a vote only have themselves to blame when the reality does not line up to their fantasy.

""""Obama is still the junior Senator from Illinois""

Once again, you can't believe everything you read here. Must I keep providing you the Obama facts to stop the lies?

Obama WAS a Senator, the operative word is WAS.

Sometimes a slip of a tongue can say a lot. Here in the AP report, Barack Obama:
"I wasn't saying anything I hadn't said before, that I didn't say a year ago or when I WAS a United States senator,".

So according to Obama he use to be a Senator but no longer.

He completed his 143 day career and was on to bigger things..

Fight the lies!

In a word? Illinois. Obama is still the junior Senator from Illinois...

Actually, Ezra, Iowa is the much more likely culprit at this juncture, being a swing state and all. Obama could propose moving the Bears to LA and still beat McCain in freakin' Illinois.

I hate to not just think in black and white terms, but maybe Obama sees value in supporting it for the simple fact that it helps develop the technology. Corn ethanol may not be the final product that comes out of the research. The same would apply to clean coal. All of the arguments against these things have to do with present day technology. Let the engineers and scientists work on it and see if they can make it better and more palatable in the future. You don't make progress if you don't work at it and close-minded, single track thinking is not going to help.

On a separate thread which seems to have injected itself into this forum... rail networks. I live in Europe and am a supporter of rail (and improved efficiency standards in housing, etc) but the US is much bigger than either of those France or Germany. Political will aside, the permitting process for the type of system they are building would be horrific. It takes years and years to get things like that permitted across private property and through sensitive areas and that would most certainly be an issue. Obviously, the routes between large cities could use the existing land with new tracks, but it could be very problematic to get to smaller areas. Just a thought.

Top Obama Flip-Flops

1. Special interests In January, the Obama campaign described union contributions to the campaigns of Clinton and John Edwards as "special interest" money. Obama changed his tune as he began gathering his own union endorsements. He now refers respectfully to unions as the representatives of "working people" and says he is "thrilled" by their support.

This Story
Democrats Equally Adept at Shifting Positions
Top Obama Flip-Flops

2. Public financing Obama replied "yes" in September 2007 when asked if he would agree to public financing of the presidential election if his GOP opponent did the same. Obama has now attached several conditions to such an agreement, including regulating spending by outside groups. His spokesman says the candidate never committed himself on the matter.


3. The Cuba embargo In January 2004, Obama said it was time "to end the embargo with Cuba" because it had "utterly failed in the effort to overthrow Castro." Speaking to a Cuban American audience in Miami in August 2007, he said he would not "take off the embargo" as president because it is "an important inducement for change."


4. Illegal immigration In a March 2004 questionnaire, Obama was asked if the government should "crack down on businesses that hire illegal immigrants." He replied "Oppose." In a Jan. 31, 2008, televised debate, he said that "we do have to crack down on those employers that are taking advantage of the situation."

5. Decriminalization of marijuana While running for the U.S. Senate in January 2004, Obama told Illinois college students that he supported eliminating criminal penalties for marijuana use. In the Oct. 30, 2007, presidential debate, he joined other Democratic candidates in opposing the decriminalization of marijuana.

I have watched and listened and ...

Apparently not. Cutting and pasting the same bullshit google finds in 356 other locations in the exact same wording (without bothering to inquire into a single issue) simply marks you as a passive vessel of other people's thoughts.

You can keep on pretending that you have a rational reason to vote against the man, but we know better.
.

You can keep on pretending that you have a rational reason to vote against the man...

You mean which reason, don't you? The most compelling is that fact that he has little experience, plain and simple.

Maybe the iron rule by (mostly conservative)0 economists over our legislative, regulatory, and taxing policies - principally associated with Friedmanomics - is being to be challenged. Certainly the walls of the fortress are under attack, and the hot oil to pour on the attackers is running low.

Like war, which is too important to leave to the Generals, national and international policy is too important to leave to the economists. Viva la revolucion!

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