The supposed leaders of the United States have claimed to seek “energy independence” for the past 40 years, yet the nation is no closer to energy independence now that it was in the 1970′s.
In recent years many supporters of energy independence, and corporate welfare, have championed ethanol as the product that will lower energy costs and finally give the nation energy independence.
A 2006 Policy Paper from the National Taxpayers Union states, “While ethanol supporters continue to push the fuel as a means to energy independence, they ignore the lessons learned from three other energy alternatives that have been favored in Washington at one time or another: synthetic fuels, alternative fuel vehicles, and wind energy. As with ethanol, these programs were extremely costly and produced little return on the taxpayers’ ‘investment.’”
Now there is a proposal in Congress to spend another $1 billion over five years to ensure that that at least half of all stations have installed blender pumps by 2022.
Blender pumps are capable of dispensing E-85 fuel and ethanol fuel blends. As with all things the government touches, there are hidden beneficiaries and costs.
James Wilson of Downsize DC reported in 2008, “when farmers use their land to grow crops for ethanol production, instead of food, the food supply drops and the price of food rises… A University of Iowa study indicates that ethanol production increased the average food bill by about $47 over the last six months of 2007.”
Wilson added “that every $1 of profit earned by ADM (Archer Daniels Midland – one of the major produces of ethanol) from its ethanol operation has cost taxpayers $30.”
A study from early 2013 shows that since 2005, the increased cost above the trend was $2,055 for a family of four.
That study conducted by Dr. Thomas E. Elam, President of FarmEcon , asks then answers the question, “Why is this increase in food spending important? Since 2005 consumers have diverted increasing amounts of income to food, leaving less for more discretionary items.”
Ethanol cost you more in taxes, and it cost you more at the pump, and ethanol costs you more when you go to the grocer as well.
If the federal government really wanted to solve the energy problem, they would remove all subsidies and mandates and allow a truly free market system of competing and complimentary energy sources such as wind, solar, hydro-electric, geothermal and the fossil fuels (petroleum based fuels, coal & natural gas).
By allowing a truly free market to exist, energy prices will drop as companies find ways to more efficiently deliver their product/service. Food prices will also drop because farmers will no longer be encouraged to take food out of the food supply to be used as fuel which will have an added benefit of making it cheaper for the food to be delivered to your local grocer.