The Great Corn Con

By Steven Rattner

Feeling the need for an example of government policy run amok? Look no further than the box of cornflakes on your kitchen shelf. In its myriad corn-related interventions, Washington has managed simultaneously to help drive up food prices and add tens of billions of dollars to the deficit, while arguably increasing energy use and harming the environment.

Even in a crowd of rising food and commodity costs, corn stands out, its price having doubled in less than a year to a record $7.87 per bushel in early June. Booming global demand has overtaken stagnant supply.

But rather than ameliorate the problem, the government has exacerbated it, reducing food supply to a hungry world. Thanks to Washington, 4 of every 10 ears of corn grown in America — the source of 40 percent of the world’s production — are shunted into ethanol, a gasoline substitute that imperceptibly nicks our energy problem. Larded onto that are $11 billion a year of government subsidies to the corn complex.

Corn is hardly some minor agricultural product for breakfast cereal. It’s America’s largest crop, dwarfing wheat and soybeans. A small portion of production goes for human consumption; about 40 percent feeds cows, pigs, turkeys and chickens. Diverting 40 percent to ethanol has disagreeable consequences for food. In just a year, the price of bacon has soared by 24 percent.

To some, the contours of the ethanol story may be familiar. Almost since Iowa — our biggest corn-producing state — grabbed the lead position in the presidential sweepstakes four decades ago, support for the biofuel has been nearly a prerequisite for politicians seeking the presidency.

Those hopefuls have seen no need for a foolish consistency. John McCain and John Kerry were against ethanol subsidies, then as candidates were for them. Having lost the presidency, Mr. McCain is now against them again. Al Gore was for ethanol before he was against it. This time, one hopeful is experimenting with counter-programming: as governor of corn-producing Minnesota, Tim Pawlenty pushed for subsidies before he embraced a “straight talk” strategy.

Eating up just a tenth of the corn crop as recently as 2004, ethanol was turbocharged by legislation in 2005 and 2007 that set specific requirements for its use in gasoline, mandating steep rises from year to year. Yet another government bureaucracy was born to enforce the quotas.

To ease the pain, Congress threw in a 45-cents-a-gallon subsidy ($6 billion a year); to add another layer of protection, it imposed a tariff on imported ethanol of 54 cents a gallon. That successfully shut off cheap imports, produced more efficiently from sugar cane, principally from Brazil.

Here is perhaps the most incredible part: Because of the subsidy, ethanol became cheaper than gasoline, and so we sent 397 million gallons of ethanol overseas last year. America is simultaneously importing costly foreign oil and subsidizing the export of its equivalent.

That’s not all. Ethanol packs less punch than gasoline and uses considerable energy in its production process. All told, each gallon of gasoline that is displaced costs the Treasury $1.78 in subsidies and lost tax revenue.

Nor does ethanol live up to its environmental promises. The Congressional Budget Office found that reducing carbon dioxide emissions by using ethanol costs at least $750 per ton of carbon dioxide, wildly more than other methods. What is more, making corn ethanol consumes vast quantities of water and increases smog.

Then there’s energy efficiency. Studies reach widely varying conclusions on that issue. While some show a small saving in fossil fuels, others calculate that ethanol consumes more energy than it produces.

Read the entire New York Times article, here.

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22 Responses to The Great Corn Con

  1. It’s a corny article. They don’t need to use corn for bio diesel. There is HHO technology out there right now that takes hydrogen from water and injects it into the intake of a car thereby reducing the gas consumption by 25 to 50%. You can buy HHO generators online now for about $250 complete. There are several small companies starting up now to make and sell these HHO generators. On some cars the gas consumption is reduced by 50%. That is amazing, but a fact. It’s just ignorance and corporate power that keep people in the dark. Do your homework – HHO is real fuel.

    • madan gopal das

      KB, have you done this and verified the reduced gas consumption? A friend of mine did the HHO generator a couple years ago and it was quite a project with very little reduction in fuel use. I’d be interested to know if your figures are false advertising or improvement of such products.

      Ethanol is different than biodiesel. My car uses biodiesel that a local co-op refines from used grease collected from local restaurants. Cool stuff!

  2. I managed to finish the article, although it nearly made me sick. This is the perfect example of why demoncrazy, I mean democracy, doesn’t work. On top of the fact that the political parties are both so self-motivated as to be nearly frozen in their range of action, with practically few exceptions, either no one in government even has a brain anymore enough to figure out the simple things that should be done to run a country and/or they are too corrupted by their literal “pork barrel” politics to do the right thing. Any Vaishnava worth his “salt” with a genuine kshatriya tendency could resolve this issue in 30 minutes. What is even sadder is that we arrogantly like to think that democracy is the best mode of government, and we liberally promote it elsewhere, usually as a smoke-screen for our self-motivated oil grabs or misguided manipulation of large parts of the 2nd and 3rd world countries, when the simple fact is that it doesn’t even work here.

    • Any Vaishnava worth his “salt” with a genuine kshatriya tendency could resolve this issue in 30 minutes.

      I have serious doubts about this statement. It seems extremely naive. Geopolitics is a very complicated affair these days. Are you proposing monarchy as a solution to the ills of democracy? Perhaps a more realistic way to look at it is that democracy seems to insure the freedom to practice one’s chosen spiritual path, at least in the USA. It also allows one to speak up and lobby for change. Convince your neighbor by your example and together with such neighbors change policy through a system that theoretically allows for such change.

      • I second Swami’s thoughts… We should not easily dismiss democracy as some useless idea in deference to some kind of idealized Vedic system which we have no current reference for and very little anectdotal information about. Better to deal with the current reality. Its a shame there is no smooth and easy system of government, but these are the times we live in. Its healthy to hone our vision, see through the muck, do the hard work that is required in a democratic society while living our high ideals as much as we can.
        Government is a necessity because of one basic thing – disagreement. At least in democracy difference of opinion is honored and negotiated and the animal tendency to silence (or kill) one’s opponent is civilized by use of discourse. Very simply put, I’d rather have it this way (crummy as it is at times when my opinion isn’t winning) than any other current system where might makes right or dissent can equal death! Not much point in wishing for a world in which we would be the Vaisnava dictators silencing any who would oppose. Just ain’t the reality…

    • Any Vaishnava worth his “salt” with a genuine kshatriya tendency could resolve this issue in 30 minutes

      Really Vaisnavas could not manage a small organization like Gaudiya Math and ISKCON and now they can manage the whole country? Your statement is not even wrong. And they need secular judges to solve issue like ritvik etc, GM conflicts?

    • Anandamaya Prabhu, American political system is a democracy in name only. In practice it is a pure oligarchy – the rule of people who have a lot of money, or what some call ‘special interest groups’. Both parties are 100% sold out to these folks.
      There are plenty of truly democratic political systems in the world, where these type of Washington con-games would be unthinkable. Corn may be a racket, but a much bigger and more disgusting racket is the US war machine. At least the corn racket is not responsible for tens of thousands innocent people killed or seriously wounded every year this policy is in place.

      • Great point!! I think very few people realize or even contemplate this point – Is U.S a democracy? Is there even a single senator or Congressman coming in from low income groups? There are plenty of them in India though. Democrarcy in United States actually seems to be an outgrowth of capitalistic thought, and primarily promotes capitalism in and around the world – in guise of freedom of speech, thought and democracy. Native cultures cannot stand this kind of sustained onslaught in name of enlightened thought. The result – catastrophic loss of traditional knowledge and common sense, accompanied by growth of a materialistic society.

      • Kula-pavana, Prabhu,
        I would say “throw the bums out,” but that would be considered seditious so I won’t say it. Additionally, I am attempting to become a bhakta, not a political radical. And even if the governmental system were changed, what could replace it could be far worse. Although they today took some tentative steps to solving the debt issue, and forestalled an immediate crisis, this isn’t over yet. Yes, the American military machine is their “sacred cow,” although that is where the bulk of spending cuts could readily come from. The hubris in this country – that we are the world’s cop and can impose our viewpoint, as well as impose our military presence and even dictate who should or should not be in power in sovereign foreign lands – is amazing. Very few U.S. senators and congressmen even sense this – one notable exception is Ron Paul, but his is practically a voice in the wilderness.

  3. Instead of democracy or monarchy, perhaps what the USA needs is a totalitarian form of government like the Iskcon GBC. Then whoever didn’t agree with the verdict of the committee could just be kicked out of the country.

  4. Maharaj & Prabhus, My point isn’t so much the system as the gross general lack of intelligence by those running it. What they do is most often against any grain of common sense. But then, as it has been said, common sense isn’t so common anymore. But yes, the system is faulty, also, and the liberties we take for granted may not be there when the system finally crumbles through gross mismanagement and partisan politics, and that is definitely where it is headed.
    And, yes, a Vaishnava monarchy run by a truly noble and high-minded Vaishnava wouldn’t be a bad thing, except that it may be difficult to find a truly noble, high-minded Vaishnava who would be interested in running a country. What seems to have been forgotten about monarchies, due to the examples we have seen of degraded monarchies over the last few hundred years, is that a good ruler truly has the interest of his people at heart, above his own interests. Modern democracy was formed as an alternative to degraded monarchies, but a proper monarchy would be vastly superior to democracy.

    • I am not sure a monarchy would be effective in today’s world no matter who the king was. Furthermore it is a pipe dream at best and a politically naive idea in my opinion. Again, better to work with the present system that gives one the facility to be a Vaisnava, bring others to Vaisnavism, and change government policy to the extent one is successful in increasing the number of Vaisnavas by one’s precept and example. This puts the solution to the problem squarely in your own hands. “Doctor cure thyself.” This is the mandate of the Gita.

      It is also worth noting that there is a wide spectrum of positions Vaisnavas take on various issues, often in opposition to one another on hot issues of the day. Basically there are Republican, Democratic, and Independent Vaisnava mindsets on many issues.

    • When was common sense common? There was never time it existed commonly, nor it will ever exist commonly. The greatest thing to know about history is that man can never learn from history.

  5. No, I don’t expect a monarchy to happen anytime soon, either, probably not until the next Satya yuga. The best we can hope for at this stage is 10,000 years during which Vaishnavas can, without tremendous disturbance, get purified and go back to Godhead. But I feel that it is a nice ideal to hold, and a true rajarshi would be better able to direct his citizens than the totality of senators and congressmen combined. But the empire known as the U.S.A. is impermanent, and unless it begins to quickly resolve some core issues, the country will eventually dissipate and be conquered from either within or without, possibly being replaced with something even worse. As far as Vaishnavas feeling comfortable here in their ability to freely practice Vaishnavism, I am nearly convinced that we’re likely considered subversives by those who really wield power, “” just as citizens who have “instructed themselves on topics ranging from first aid to childbirth to edible plants” are to be considered potential terrorists and extremists”” according to a Dept. of Justice internal document reviewed by Independent Living, although I haven’t personally done my due diligence yet and confirmed that statement. But if true, it is to say that our government’s general viewpoint can only be considered somewhat demonic, not benign in the least. Disclaimer: Yes, my viewpoint is only my own personal opinion, although I hope that in some small way it may help others.
    Yes, perhaps common sense was never common, but in my youth I at least perceived that things seemed better managed. There didn’t seem to be as many flagrant problems in the country or even the world, although perhaps I was just unaware of them.

    • Why don’t you resolve the issues within the small Vaisnava community and the different sects before you
      There were always problems. 1/3 of the population used to get wiped out during a plague breakdown in UK. Feudal aristocracy cared less for common people,the caste system was rampant in India, blacks were mistreated when you were in the youth. The list goes on. Things are worse in some ways not and better in others. There is no evidence that the current size of population ever existed on this earth and lived in complete harmony. Yes the ideal is described in the books but even small Vaisnava sects have been unable to achieve harmony after being transcendental to the three modes and following 4 regulatory principles. What can you expect from people functioning in the modes?

      • I don’t know about the history of medieval or Early Europe, but I do know a little about history of India. The Golden Age of India was the period of the Gupta Empire(in 1st-3rd century A.D) – whose monarchs styled themselves as Parama Bhagavatas.It was period of unrivaled prosperity for India – if you want to know what was India like, read Fa-heins observations about the Guptas.
        So this idea, that monarchy is entirely bad, and not good at all is a gross generalization – pre-Islamic India, was under a monarchy but had its best days under them.

  6. Madan Gopal, in answer, I would just say do a YouTube search for HHO powered cars and you will find a number of inventors and technicians who have built working HHO systems. There is no need for me to try and prove that HHO works. There is plenty of proof out there right now. Just because I don’t have a working HHO unit on my van doesn’t mean that it doesn’t work. There are even a few prototypes out there that run exclusively on water.

    • just sayin’, because it was a couple years ago that I did watch several youtube videos on HHO systems installed to the air intake and inspired by those that my friend made/installed a unit which was not the 25-50% reduction of gas consumption you claimed was available. I’m not criticizing you, just suggesting that in my experience you may not have done “the homework” to find out if the claims of people marketing these products which you called facts are accurate. Mine is just one small experience with one friends car; a teeny bit of homework. I would like to know what other cars/products/people experience before claiming it fact or totally bunk. But I would think that if people could reduce their gas consumption 50% for a $250 expense, these systems would have long ago been bought up by car manufacturers and installed during production.

  7. Madan Gopal, you are skeptical and many people are skeptical and that is why HHO energy is still relatively undeveloped. People have to get over this skepticism and push the government to make sure HHO energy is available. They could run large power plants off of HHO if they wanted to. It could be done but there are too many vested interests in making sure HHO doesn’t become popular. HHO is the answer. We don’t need anything but water to fuel the future of humanity. It sounds like a pipe dream but it is very much a possibility.

  8. As a fuel, ethanol is a joke, and making fuel out of food grade corn is flat out demonic, given so much hunger in the world. Still, the practical solutions to the global thirst for oil are very hard to come by, especially since people expect them to be cheap and easy.
    The easiest and cheapest fix is to simply use less, by improving fuel efficiency and decreasing demand.

  9. Corn-dogs, anyone?

    This time, despite my great eargerness to sound off, I actually read through the 20 odd comments. As the song says, “Whole lotta shakin’ goin’ on!” People are thinking. People are dissatisfied. Well, that’s supposed to be a sign of intelligence. Then the question is, what do we do about it? Do we try to make this world a better place, samsara with all the perks? Or do we opt for understanding that the function of the material realm is to dissuade us from our self-centered preoccupations, while offering an exit from mainstream spiritual disorientation? In other words, don’t go away mad – just go away – back to home – Krishna Loka.

    Of course, even if we are determined to go back home, we need a base of operations. And that brings up the question of social structure, economics, government etc.

    The feudal system of the west was like varnashram with it’s head cut off. No brahmincal guidance. The kings of Europe considered that to be bothersome. So eventually they killed the goose that laid the golden egg by pushing the people so far that the guillotine took center stage. Enter government for the people, by the people, fraternity, equality, capitalism, communism, socialism…… goes on. Welcome to Kali Yuga.

    I am not a political scientist. But the way I see “democracy” today, especially in America (the land of the free…). Well it just seems to me that the vaishya class thought the whole thing over and came to the conclusion that the best place to be based, if one wants the largest profit is inside the government. From there they can set standards of regulation, deregulation, international trade, duties, embargos, and they can impose taxation, using the proceeds for their own purposes, over-spending and then simply tell us we’re all in debt.
    At the same time, understanding that war is one of the greatest businesses going, they can implement as much war as they like while making participation manditory on the part of teenagers just getting out of school. So it seems to me that democracy is the front stage and the real executives sit backstage. That way removing all regulation, they can run their various enterprises in the public sector, abusing their fiduciary obligations, and when their businesses fail, they can bail themselves out from the public coffers, to the tune of hundreds of billions of dollars, rewarding themselves with tens of millions of dollars in annual bonuses. And then they can tell us they need to raise taxes and cut back on social services. These guys must get together at meetings and conventions sometimes, and all but double-up, falling over laughing. While all this is going on, the American public attends political conventions with six-packs, waving flags, jumping up and down, thinking they have a say in how the country is run.

    As far as the politcal and social freedoms are concerned – well, we are the consumer class. So it makes sense to give us some purchasing power. And why not let us think we have freedom of speech – as long as we don’t actually get any changes implemented?

    Anyone who does a little research on line can see that the gap between the military and the public police departments in America is being eroded at a shocking rate. Not only are the laws changing with regard to military involvement with public peace keeping, but billions of dollars of military equipment is being moved from military bases to warehouses and fenced areas that are under the auspices of public police departments. This includes, tanks, grenade launchers, machine guns, etc. They have been pushing us to the wall, and they know it. And they don’t want a repeat performance of the guillotine festivities – and they are getting ready. They are ready. They have underground cities prepared in different parts of the country, so they can hole-up when the going gets tough, while the military arm of the police state calms things down.

    So we were talking about corn…… Corn and government. Well, I spent about three weeks lately at Audarya. I didn’t get a real insite into how decisons are arrived at, how the community is governed. But that really wasn’t the purpose of my visit. I was there for sadhu sanga. But in retrospect, I have never seen a more peaceful, harmonious atmosphere in all of my 40 odd years in Krishna Consciousness. My general impression was that Central Command, Tripurari Maharaja, maintained an open eye as he visited the various areas of social organization, received input from those with different capabilites, delegated responsibilty and authority to those who were capable….. and probably only became engaged in larger issues of developement by relying on feedback and his own mature consideration. There was – no police force. No tear gas in storage. The community seemed to operate on the basis of love and trust. But this was not artificial or whimsical. It was based on the happy experience of the members of the community, of being led by intelligence enhanced by spiritual realization in the form of Tripurari Maharaja.

    Perhaps large cities are simply another aspect of Kali Yuga. But small rural communities with self-sufficient ways and means were a large part of Srila Prabhupada’s vision. City temples were there as a means of making Krishna Consciousness available to the public at large. That was our army, the weapon being propaganda distribution in the form of books, books about Krishna.

    Pleople protest against pollution of air, water, the earth, artificial forms of food production, etc. But they overlook the fact that they empower big business to do all of these things – because we are the consumers. By living in small rural communities that are self-sufficient, and not dependent of what big-bussiness has to offer, big business would be forced to dry up. But the unintelligent masses want to have their cake and eat it. They want clean air -while every American adult drives a gas-propelled vehicle. They want clean food – while they are too busy to grow it or to cook – and they drive to MacDonald’s. They want clean water, but the water is filled with chemical pollution produced by industy that produces all the “things” that they want. And they drink recycled water coming from plants that recieve their urine and stool, separate it, and send the water back with the addition of chemical enhancements.

    Afterall, this is the world of the cheaters and the cheated, as Srila Prabhupada often said. We are here in this material world because we do not want to serve Radha and Krishna with love. So we serve the material energy, called Maya, whose business is to slap some sense into us. We take our God-given energy and want to use it for our self-centered purposes. This living force was not given to us for this purpose. Therefore we are outside of The Law, we are the criminals, we are cheaters, the misusers of what has been given to us. And the material energy encourages us by inviting us to enjoy in this perverted way, only to slap us into sobriety. And all of these governments, businesses, etc., are nothing more than agencies of Maya, dispensing the treatment that is for our ultimate benefit. No one is forced to endure this unhappy situation. The status quo of the material world we live in is only an index of our collective perversity. Understanding this, we see our way forward, out of this world, and our future is very bright.

    Hare Krishna! Ishan das

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