Wednesday, June 11, 2008

Up until a couple of months ago...

We used to have a different name for folks (read the whole list) who now are labeled anti-ethanol.

We called 'em "customers".

Call me naive, but mounting a nasty public battle against our largest user segments strikes me as senseless, and possibly disastrous. Especially since high oil prices have given us a way to appear magnanimous and fair with little cost.

Even more noteworthy to me is how the farm media is now clearly divided between animal and grain sectors. We are separating our tiny economic sector into political and economic opponents.

I see very little good coming from this refusal to negotiate mandates and subsidies to ethanol. and as the 08 crops get smaller and more expensive, the consequences for grain farmers rise with the flood waters.


Anonymous said...

When you look at the fact that the corn/bean ratio is hardly ever below 2:1 or above 3:1, and all the various ratios of gold/silver, gold to land,and corn/wheat ratios, why are you surprised when the price of crude oil is pulling everything else up to keep some kind of a semi normal ratio in place? Corn and all other grains are a form of energy too, and will not stay out of balance with crude for very long.I'm ok with dropping the ethanol subsidies, but then let's drop everybody else's subsidy too. I'd be willing to bet that when the ethanol subsidies are dropped, there won't be more than a minor ripple in the corn market. Let's pick the right staw man to kick over.

John Phipps said...


I'm not sure historical ratios represent any underlying "law" and I expect they may change with the addition of ethanol to demand. I agree with you about oil, which is the point Babcock made in the linked study.

You and I may not agree on what exactly is happening but if there is no subsidy involved we don't have to go to battle, we just let the market sort it out.

And I do not share your reasoning about subsidy "disarmament". In fact, I feel subsidies harm the recipients most. For me it's like saying "I won't quit smoking until he does."