Monday, June 23, 2008


What a mess! The price of gasoline has doubled in the past year. Food prices keep going up. Where will it stop?

People in India and China and other places are starting to enjoy a standard of living that Americans have taken for granted for years. There is more demand for petroleum around the world than ever before. The oil producing countries probably cannot keep up with demand. Petroleum is contributing to global warming. Something needs to be done, and the production of ethanol is probably a good place to start.

The problem is, we have not gone about it very wisely. We are growing more corn for ethanol, which means less for food for export to poor countries. The problem with corn ethanol is that it produces just two units of energy for every unit it uses. We’re all paying for that tiny bit of extra energy because the government subsidizes rich farmers to grow that corn.

Brazil creates ethanol from sugar cane, a much more efficient process. Sugar ethanol creates eight units of energy for every unit of energy used. Sugar cane requires a tropical climate, but we could import ethanol from Brazil. The problem is, there is a 54-cent-a-gallon tariff on Brazilian sugar cane ethanol.

That makes a lot of sense. We support inefficient corn ethanol through subsidies while keeping out efficient sugar ethanol through tariffs.

Through all of this the cost of beer keeps growing up. Instead of growing barley to make beer, farmers are growing corn for inefficient ethanol production.

Dr. Carl Perrin is no longer in the presidential race, but he is still eager to serve the country. He is volunteering his services as a sub-cabinet officer, perhaps in the Department of Agriculture. In this role he would see to it that barley crops are subsidized. This needs to be done soon to keep the price of beer affordable to working people and to senior citizens!

No comments: