Stick Ethanol in the Museum of Unintended Consequences

[peejay 327]

Peejay sez: Why not mandate higher CAFE (Corporate Average Fuel Efficiency) standards so new cars get more miles per gallon? Cutting fuel consumption through conservation is the way to go. Less fuel burned = less pollution and less consumption.

Stick Ethanol in the Museum of Unintended Consequences

by Deroy Murdock

Posted 02/02/2007 ET

Many Democrats and some Republicans applauded President Bush's State-of-the-Union proposal for a 20% reduction in gasoline use over the next 10 years, largely through greater reliance on ethanol.

Bush's idea, however, is adding corn-based fuel to protests in Mexico City. Existing federal laws that mandate ethanol in U.S. gasoline have diverted trainloads of corn from America's food supply-chain to ethanol factories. This boosted U.S. corn prices nearly 80% in 2006.

That's bad enough if you buy corn on the cob for a weekend barbecue. But it's much worse if you are a poor Mexican surviving on corn tortillas. A kilo (2.2 pounds) of tortillas recently has shot up 55 percent, from 5.5 to 8.5 pesos. Poor Mexicans are not taking this sitting down.

In fact, some 75,000 of them stood up Wednesday in Mexico City's giant Zocalo plaza. More than 200 unions and social-action groups organized protests to denounce the rising price of this basic Mexican staple.

"[Felipe] Calderon stole the elections, and now he's stealing the tortillas!" screamed one banner, chiding Mexico's narrowly elected, new president. According to the Associated Press, the normally free-market Calderon has been trying to get manufacturers to follow a gentlemen's agreement to keep tortilla prices flat.

How has American energy policy inspired political instability in Mexico? This is a pristine example of The Law of Unintended Consequences. When big government does big things, all sorts of wacky stuff happens, and rarely for the good.

Uncle Sam gives ethanol manufacturers a 51-cent-per-gallon subsidy. Anyone who wants to import ethanol is welcome to, provided he pays the 54-cent-per-gallon tariff slapped on ethanol imports. This is one reason for another unintended consequence: gasoline prices shot up last summer since ethanol, largely produced in the Midwest, had to be shipped south and to both coasts to be blended, by law, with gasoline. Importing Brazilian ethanol into Atlantic and Pacific ports would have made sense, but then-House Speaker Dennis Hastert hated the idea, since that would put competitive pressure on his corn-farming Illinois constituents.

"I don't see an economic plus in it right now," Hastert sniffed.

What other unintended consequences could the federal government's ethanol-mania propel?

First, poor Mexicans will feel even poorer as tortilla prices stay high or climb even higher. At the margin, watch for more of them to throw up their hands and head north, to a neighborhood near you.

Second, as fuel companies buy more and more corn, prices will rise for corn flakes, corn bread, popcorn, corn syrup, and other food items. Grocery bills should grow, at least marginally.

Third, humans eat corn, but so do cows, pigs, and chickens. Meat prices will rise, hurting U.S. consumers and making American meat exports less competitive on world markets.

Fourth, if they have not already, members of the Federal Reserve Open Market Committee will notice these increases in consumer and producer prices. Fearing inflation, they could start increasing interest rates. That would slow the economy and push into foreclosure more Americans with variable home mortgages.

This economic damage will accelerate if President Bush promotes, or if the federal government mandates, a one-fifth drop in gasoline use by 2017. According to estimates by Cato Institute scholars Jerry Taylor and Peter Van Doren, writing in the Winter 2007 issue of The Milken Institute Review, "If all the corn produced in America in 2005 were dedicated to ethanol production…it would have reduced U.S. demand for gasoline by, at most, 12 percent." So, to reach Bush's 20 percent goal, corn production must grow to 167 percent of its 2005 levels, and every kernel must go into ethanol. Kiss your corn pudding goodbye.

Cultivating that much corn will require even more farmland. Securing it likely will require chopping down the same trees that inhale the carbon dioxide that humans and cars exhale. If Al Gore is telling the truth, this will increase global warming. So, one of the environmentalists' favorite tools for fighting global warming actually could exacerbate it. Meanwhile, as the Wall Street Journal editorialized on January 27, "ethanol increases the level of nitrous oxides in the atmosphere and thus causes smog."

How lucky we are to have a government big enough to tie its own shoelaces together.

http://www.humanevents.com/article.php?id=19240

[Heracles 417]

Are there any cars here that run on LPG??

[Saddle Bronc 124]

Are there any cars here that run on LPG??

Some taxis do, others run on CNG.

Big problem with both--they wipe out your bootspace (to carry the special fuel tanks).

Biodiesel (from used fry-oil) would be a much better option:

• diesel cars already exist, and DON't need a special tank which clobbers bootspace
  
• using turbocharged common-rail, you can boost the peak HP output to about that of a carburetted petrol engine (though still lower than that of injected)
  
• nice avenue for disposal of an otherwise waste product produced in large quantity (esp. with US high appetite for fast-food)
  

[peejay 327]

Are there any cars here that run on LPG??

I used to work for Mesa Petroleum owned by flamboyant oilman T. Boone Pickens many years ago. He bet the farm on LNG (Liquid Natural Gas) powered vehicles and had a subsidiary company that developed dual fuel (gasoline / LNG) vehicles. Many of the company vehicles in the company fleet were fitted with the system. He often toured the USA promoting his vehicles and natural gas. It never took off. And natural gas was dirt cheap from the mid 1980's well until after 2000. But so was gasoline.

A lot of company fleets of vehicles do use LPG and LNG. It works well in some applications. It is certainly feasable, but not always practical for widespread applications for a multitude of reasons.

[Robor007 0]

Substituting ethanol (or other petroleum alternatives) in place of gas isn't the only answer to reducing overall gas usage. What about simply buying more fuel efficient vehicles? IMO we are spoiled (yes, that word again ) with our low fuel costs and the amount of huge vehicles with city MPG ratings in the mid-teens is proof. I'd support raising the gas tax a significant amount to fund research for alternative fuels.

[Saddle Bronc 124]

Substituting ethanol (or other petroleum alternatives) in place of gas isn't the only answer to reducing overall gas usage. What about simply buying more fuel efficient vehicles? IMO we are spoiled (yes, that word again ) with our low fuel costs and the amount of huge vehicles with city MPG ratings in the mid-teens is proof. I'd support raising the gas tax a significant amount to fund research for alternative fuels.

Which brings us back to the biodiesel: generally, moderate-to-well-maintained diesels will give you better fuel economy (in MPG or km/L) than petrol engines of same displacement (and with turbocharging, the loss in horsepower output can be mitigated).

[Yodrak 7]

peejay,

Perhaps these Mexicans should start planting instead of protesting?

They've been offered a potential bonanza here since the USA doesn't grow enough corn to make the amount of ethanol Bush is calling for (something he conveniently neglected to mention).

Yodrak

Peejay sez: Why not mandate higher CAFE (Corporate Average Fuel Efficiency) standards so new cars get more miles per gallon? Cutting fuel consumption through conservation is the way to go. Less fuel burned = less pollution and less consumption.

Stick Ethanol in the Museum of Unintended Consequences

by Deroy Murdock

Posted 02/02/2007 ET

Many Democrats and some Republicans applauded President Bush's State-of-the-Union proposal for a 20% reduction in gasoline use over the next 10 years, largely through greater reliance on ethanol.

Bush's idea, however, is adding corn-based fuel to protests in Mexico City. Existing federal laws that mandate ethanol in U.S. gasoline have diverted trainloads of corn from America's food supply-chain to ethanol factories. This boosted U.S. corn prices nearly 80% in 2006.

That's bad enough if you buy corn on the cob for a weekend barbecue. But it's much worse if you are a poor Mexican surviving on corn tortillas. A kilo (2.2 pounds) of tortillas recently has shot up 55 percent, from 5.5 to 8.5 pesos. Poor Mexicans are not taking this sitting down.

In fact, some 75,000 of them stood up Wednesday in Mexico City's giant Zocalo plaza. More than 200 unions and social-action groups organized protests to denounce the rising price of this basic Mexican staple......

[Robor007 0]

Substituting ethanol (or other petroleum alternatives) in place of gas isn't the only answer to reducing overall gas usage. What about simply buying more fuel efficient vehicles? IMO we are spoiled (yes, that word again ) with our low fuel costs and the amount of huge vehicles with city MPG ratings in the mid-teens is proof. I'd support raising the gas tax a significant amount to fund research for alternative fuels.

Which brings us back to the biodiesel: generally, moderate-to-well-maintained diesels will give you better fuel economy (in MPG or km/L) than petrol engines of same displacement (and with turbocharging, the loss in horsepower output can be mitigated).

I'm all for whatever reduces our dependence on petroleum and our impact on the environment. If biodiesel and the answer then it gets a for me. I'm willing to give up a little power as well. I've got a 2000 VW GTI with a small (2.8l) V6 It seems like so many car manufacturers these days are in a horsepower war. Do we really need an Accord with 240 bhp (my bro's car) or a G35 with 300bhp or (insert any modern 'luxury' sedan)?

[moelarrycheese 0]

I have an old Mercedes 240D that I run on biodiesel. i produce the biodiesel myself using waste oil from a chinese restaurant. I get the oil for free and make the BD in a homemade processor I built from a discarded water heater I found on the side of the road. It's a very simple process that takes about 1 hour of my time to make 20 gallons (one batch). The car runs excellent and the fuel costs me $0.85/ gallon to produce. I highly recommend it to anyone looking to help solve this problem.

[peejay 327]

peejay,

Perhaps these Mexicans should start planting instead of protesting?

They've been offered a potential bonanza here since the USA doesn't grow enough corn to make the amount of ethanol Bush is calling for (something he conveniently neglected to mention).

Yodrak

Unfortunately, it would take more than corn exports to turn Mexico around. And I doubt that the average Mexican would see much prosperity from increased corn production and export. It would mostly benefit the upper classes. We already have quite a big trade deficite with Mexico already and the illegals keep on coming (over here).

I agree with Robor007...decreasing consumption through higher CAFE mpg standards or higher fuel taxes would go a long way.

Government policies (or lack there of) often have unintended consequences. The USA has increased its population by 100 million people in roughly 30+ years mostly through immigration policy (or lack there of). We will soon have another 100 million if government policy does not change. More people, more housing & buildings, more roads, more cars (more pollution & fuel consumption), less arable agricultural land (to grow corn), less open spaces, etc., etc.

It all seems so counterproductive to existing problems. For every government policy action (or lack of action) there is a reaction (and not always for the better). It is all interrelated.

[Hilarious Clinton 452]

Substituting ethanol (or other petroleum alternatives) in place of gas isn't the only answer to reducing overall gas usage. What about simply buying more fuel efficient vehicles? IMO we are spoiled (yes, that word again ) with our low fuel costs and the amount of huge vehicles with city MPG ratings in the mid-teens is proof. I'd support raising the gas tax a significant amount to fund research for alternative fuels.

Which brings us back to the biodiesel: generally, moderate-to-well-maintained diesels will give you better fuel economy (in MPG or km/L) than petrol engines of same displacement (and with turbocharging, the loss in horsepower output can be mitigated).

I've posted this before..... but it still amazes me.

Stock Honda Accord diesel gets 92 mpg in mixed driving

[pj1959us 0]

Have they improved the diesel cars from a few years ago? I know quite a few people had them (in Illinois), but the engine knock was deafening and the cars wouldn't start in the cold winters here.

[Hilarious Clinton 452]

Have they improved the diesel cars from a few years ago? I know quite a few people had them (in Illinois), but the engine knock was deafening and the cars wouldn't start in the cold winters here.

That's the image most Americans have about diesels. They are much more advanced now. A couple years ago I rented a diesel Mercedes in Germany and I couldn't tell it was diesel.

[Yodrak 7]

peejay,

Well, if poor Mexicans don't want grow corn for export to take advantage of increasing prices if US corn, they could always grow their own corn to make their tortillas from rather than continuing to buy our expensive corn?

The point is, our increasing prices are giving them a potential opportunity if they'd just look for ways to take advantage of it instead of spending their efforts blaming someone else for their problems. They need to think like Toyota and Honda rather than GM and Ford (whose car sales increase, and whose decrease, when the price of gasoline rises?)

Yodrak

peejay,

Perhaps these Mexicans should start planting instead of protesting?

They've been offered a potential bonanza here since the USA doesn't grow enough corn to make the amount of ethanol Bush is calling for (something he conveniently neglected to mention).

Yodrak

Unfortunately, it would take more than corn exports to turn Mexico around. And I doubt that the average Mexican would see much prosperity from increased corn production and export. It would mostly benefit the upper classes. We already have quite a big trade deficite with Mexico already and the illegals keep on coming (over here).

.....

Edited February 2, 2007 by Yodrak

[Saddle Bronc 124]

Have they improved the diesel cars from a few years ago? I know quite a few people had them (in Illinois), but the engine knock was deafening and the cars wouldn't start in the cold winters here.

Most improvements on diesel (including better turbocharging and common-rail technology) have been done in Europe and Asia (Japan, Korea--and to some extent, India). I test-drove a Passat TDI in 1997, and could only tell by the fact it was not whisper-quiet (but I could listen to the radio at regular volume); it had excellent pickup (nearly matched my petrol-driven Jetta, with 4-cylinder petrol).

Unfortunately, the US carmakers haven't figured it out. Their first attempts at diesels were bastardised off petrol engines (using the same block and pistons)--resulting in a lot of blown gaskets.