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Monday, February 05, 2007

Ethanol marketing victory

Regardless of the economic viability (or advisability) of the government involvement in the fuel industry, the popularity of the ethanol "solution" suggests that either the politicians have done a wonderful job in selling the idea or, perhaps more realistically, the politicians have jumped on the ethanol bandwagon precisely because of its popularity with the vast majority of Americans.

There are reasons for caution, especially concerning the unintended consequences of such a major increase in the demand for corn as envisioned by the corn producers and the politicians. The issues that concern economists, who after all comprise a very small proportion of the overall population (perhaps there are 40,000 research/teaching economists in the country?), are evidently not on the radars of the average American nor on the minds (or lips) of the politicians.

From last week's BEEF/Cow Weekly:
Voters Show Strong Support For Ethanol
The Renewable Fuels Association released a poll recently showing 85% of U.S. voters believe the "government should be involved in the development of alternative fuels." Other findings of the Jan. 8-9 survey of 1,000 registered voters conducted by the Winston Group include:

  • 84% believe the government should provide incentives for the production of alternative fuels, such as ethanol, to reduce dependence on imported oil.

  • 88% believe the development of the domestic ethanol industry helps create jobs and is beneficial to the overall economy.

  • 85% believe ethanol helps farm-state economies.

  • 80% believe ethanol is an important component of our domestically-produced energy supply.

  • 60% believe ethanol impacts the economies of any state not a traditional farm states.

  • Assuming the survey was taken appropriately and the 1,000 folks are representative of the U.S. population, those numbers indicate an overwhelming level of support for the idea of ethanol. The politician or political party that makes ethanol politically practical - in which sense I mean without obviously taxing the hell out of us to subsidize production - stands to gain considerable esteem amongst the voters. This, in my view, partly explains the push towards ethanol even as there are so many unanswered and unasked questions concerning such a move.

    Comments:
    The ethanol lobby seems not to take account of the demands that extra planting will put on water resources either...
     
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