Is Ethanol Really a Problem?

John Cole points out the unintended consequences of the ethanol subsidy on the price of food. I see the upside to rising food prices. Maybe some the dollar hamburgers, bags of chips and 8000 ounce sodas will go away. Don't I hear and see reports on an almost daily basis that we're a bunch of fat slovenly pig boats who need to walk more and eat healthier food in smaller portions? The ethanol industry and its subsidies seem to have been quite the panacea with respect to weaning us off of the cheap processed food so many of us rely on.

I don't like the ethanol subsidy and the obvious pander it is to the voters in the corn growing states. But my distaste is an entirely different argument to the issue at hand. Most Democrats are for the subsidy, and it is difficult to find a Republic from a corn producing (ethanol) state who is against it. It is a convenient way to keep farmers employed. Unfortunately, most of those farmers are corporate agriculture conglomerates.

The charming and informative documentary King Corn covers the effects of the corn subsidy on the food supply. What and how we eat is directly impacted by the corn subsidy. The most profitable corn crop for farmers is yellow dent (a genetic hybrid) that is used to produce High fructose corn syrup. Add the ethanol subsidy and you have what some see as a disastrous impact on the price of food. To my mind this as an opportunity rethink how our food supply is managed. Sustainability should be a top priority.

More on this later.

Eating America

Addressing the issue of rapidly rising food prices Tim F. has this post at Balloon Juice. He is spot on with this warning:

A good argument could be made, then, that we’re better off if price spike now while the system still has some flex in it. The situation would be much worse if the spike only hit later when pressure only comes from inflexibles like climate, fuel and population. Instead of rising, plateauing and sinking a little from elasticity food costs would do the crazy dance that commodities do when inflexible demand meets a fixed supply.

A more decentralized agricultural system--with some returning to east of the Mississippi where average rainfalls are higher--could assist as well. I just searched for a paper I read several months ago about returning a large portion of the U.S. food production base to the eastern half of the country would serve several purposes, including less energy input, water use, and safety from devastating terrorist attacks on large centralized production. I believe one of the other recommendations was for the consumer to purchase roughly 15% of their food from local sources (raised within a 100 miles of where they live). A rough calculation seemed to confirm that this would provide enough income for small growers to stay in business and grow that portion of the food economy at a sustainable rate.

The food system is already broken, and we now have the opportunity to remake it into a healthier (for the consumer and farmer) version of the post-WWII model of centralized production.