Saturday, October 12, 2013

                                       Corn Likker,  Food Prices, and Red Handed Proof

           It takes a lot of power to force anything down the throats of an industry as powerful  as the oil industry, but  with little help from a few  key senators, a few dozen congressmen, and a few million unthinking useful idiots in the environmental camp, big agriculture managed to figuratively   force big oil into bed  back in '05, and has kept forcibly  that otherwise shameless huzzy there  ever since, in spite of  all her   screaming  and crying, and  the  late "but better late  than never"  sympathy of thinking environmentalists.

         Now don't get me wrong. I'm about as far from being a fan of the oil industry as a rational person can get.The most I'm willing to say for the oil industry  is that it is a necessary evil, and that we  simply must have oil  and have it in  humongous quantities  for now and  for a hell of a long time to come because without it our entire economy will collapse about as fast as  a sand castle in a tsunami. Hopefully we will eventually figure out ways to  get by without  oil- at least without very much of it.We better, because there is inevitably a time coming  when only modest quantities of oil are available and then only at exorbitant prices. But I digress.

         The oil industry is not one situated by it's long   record of less than sterling behavior  to get much sympathy or respect when it  tries for the  high moral ground, but once in a  while even a seasoned    crook is telling the truth when he says he didn't do it.

     I have a couple of relatives who have made good solid careers out of being convicts; they like it so well that whenever they   get out thrown out of the pokey, they manage to get back in again in a matter of months - which is much  faster than most of us can find a full time  job these days, given the state of the economy and Obama care......
           One of these guys is has such a reputation as a prolific worker that I have  been seriously asked if I thought that he  really did  break into four different houses in four widely separated neighborhoods in  one day-to which inquiry I replied with  due modesty that although the family takes considerable and justified pride in his professional  accomplishments, the truth of the matter is that he simply wasn't  up to it, what with the  necessary drives from one house to another and  the  trips  he had to make to stash the loot, and stopping for  lunch and gas and dropping off  his kids at school- somebody else   burgled one of those  four houses, as was later proven in court.

       But still, three widely separated jobs of that sort in one day, along with looking after getting the kids to school, is right much of an accomplishment, and so far as we know, it's a local record. I guess an urban burglar could do four jobs in a day,  easy, if he stuck to small stuff like silver and laptop computers, but my cousin - now he goes in for more substantial goods, such as  billiard tables, and ya can't expect a man to  move  one of them heavy  suckers and still hit three more houses the same day , even if they are real close together.

      The truth of the matter is that in this particular case, that   slick and nasty oily old ole   industry is telling the truth when it says that ethanol is a bad deal for  them and the consumer.

      The consequences of this   forced relationship have proven to be serious indeed, but  the general public   has  fallen for the industry's endless false  but highly skilled  and well orchestrated protestations of innocence. Most people simply don't have a clue as to just how bad a deal  the ethanol mandate has proven itself to be  for  us as individuals and as a country.

       I'm not going to have time today  to go into detail in respect to the many ill effects  the subsidized manufacture  corn likker-moonshine- by the  millions of barrels  is having on our economy and our environment . I'm  just  going to briefly mention the worst effects for the moment  and leave it to you to look around  a little  to see for yourself  just what the facts are.

    But  I will come back to this topic some day soon and go into some depth  depth and put up some  links that will   help you develop a deeper understanding of the many  ill effects of growing so much corn and  manufacturing so much ethanol.

           The worst short term result of the ethanol mandate has been  a  substantial  across the board increase  in the  prices of basic or  staple foods   which has pushed tens of  millions of people around the world  to the very brink of starvation, and created hardships for more millions of  working class  and unemployed Americans.It's  caused every body else's  grocery bills to go up too , but  if you're reasonably well off by American standards,  food is dirt cheap anyway   and couple more bucks for a nice beef roast  is no big deal.

       Beyond  this rise in food prices- which has  put my own family   and most people I know in the position of eating  a lot less prime  ribeye than we  would like - the ethanol mandate has resulted in  many  millions of tons of fertilizers, pesticides,  diesel fuel, coal, and natural gas being used  wastefully - so wastefully  that it is highly questionable if there is even  a net gain in energy after all the production,  manufacture , and distribution costs are properly  tallied up.

       The ethanol mandate has also resulted in  millions of acres of farmland that would otherwise be idle - and resting up   for future use- being   put into  monoculture corn, which in and of itself  results in substantial harm too the soil and to the wider environment  due to loss of wildlife habitat and water pollution- a  secondary result of  using so much  fertilizers and pesticides.

     Here's the red hot proof of the connection between  ethanol and food prices I promised you in the title of this post.

    You  might want to copy this article for later reading - it's the sort of thing that tends to disappear  sometimes.

     The ethanol industry has steadfastly maintained that  it is not responsible for  record high corn prices since the mandate took effect, and it has enough clout that not many mainstream news media have been willing to question that claim for fear of losing the advertising revenue  brought into their businesses  by companies associated with  big agriculture.

      Here are a few little  industry insider quotes from the article  that inadvertently  blow aside the  curtain  and  allow us a good look  at the  moonshine wizard.

        "Because of the dramatic economic impact on commodity markets"  translated into plain English reads  roughly :   

       ' We're pxxing in our pants because without the mandate we're noncompetitive and we know it. Ethanol prices will collapse, and  with the crash in ethanol prices, the price of corn will collapse too, because   a huge portion of the nation's corn crop is used to make ethanol. There will be a follow on effect in the  prices of  a lot of other commodities too; fertilizer and soybeans for instance will be cheaper.Chicken, pork and beef be  will be cheaper. And even though we mostly got 'em by way of govt subsidies and fire sales, and have very little of our own money tied up in them,  we're triple pxxxxd because we'll have to sell our  moonshine factories for scrap if we were to lose the mandate or if it gets  cut back very much. A whole lot of people have been making a whole hell of a lot of money out of this thing, and we ain't about to give up our  gravy train without leaving plenty of  bloody hair and   eyeballs littering  the sidewalks around  congressional offices".  

         "I believe we are competing head-to-head with Big Oil"  translates as  bullxxxx pure and simple.
        If  the moonshine industry were actually competing with anybody- other than all the other voracious pigs  lined up in DC hoping to   latch onto one of the  federal sow's countless tits- it wouldn't need a mandate.

      "In our opinion, they are going to be very defensive to give up any gas tank share - they are going to defend their share at all costs" translates as:
    "We have a huge war chest and we own a few key senators and a bunch of congressmen,  and the big time farmers who dominate  corn state politics are backing us to the hilt, because they're  making ten times as much money  these   days as they used to, before the ethanol mandate doubled the price of corn for them."

   Sometime soon I will post an extensive followup going into detail as to why mandated ethanol is such a bad deal for everybody except the people getting rich  from it.

1 comment:

  1. Hey OFM,

    The Wet One here.

    Futilist is gone from Peak Oil Barrel. Ron has banned him. C'mon back and join us!