Several countries are questioning whether ethanol is really that beneficial. Are they all wrong? Ethanol is a farce and facts substantiate this. It does nothing except raise cost. Anyone that says oil is too blame better look and see what has to be used to make and transport ethanol. It isn't other biofuels! Research all the facts! Don't be fooled by half truths and political agendas!

And I'm not in any way minimizing the role of commodity subsidies. If the commodity subsidies were removed, I think it wouldn't be long before we'd have a disastrous collapse of food production. That's when we'd really be talking about foood shortages and hunger. A wave of mass bankruptcies in the agricultural economy could quickly turn into a crisis on the level of the Great Depression. It's the New Deal era ideology that brought us these policies that have worked well ever since to maintain stable food production in the U.S.

Yes, subsidies are “market distorting” but the unfettered free market has its drawbacks — namely the tendency for boom and bust cycles in the economy. We don't want to have a big bust cycle when it comes to food.

the concurrence of factors you cite does indeed make this a perfect storm. But really, don't attempt to minimize the role of market-distorting agricultural subsidies and a F***ed-up tax policy that mandates ethanol (which is, in fact, a double subsidy…or, as you'd prefer, a subsidy + 1 tax credit).

WE are responsible for these riots. US. Iowans. Americans. We can suck off the teet of federal government, but let's take a second to realize whom we are harming.

There are tax credits available for ethanol production. I don't personally consider a tax credit as being the same thing as a subsidy. Ethanol and biodiesel are supported by giving tax credits to the fuel blenders, not with actual subsidies.

and are they part of the farm bill or energy bill?

But, there is a section called “direct payments” which go out regardless of market prices. Direct payments are something that reformers, including Sen. Harkin, have been trying to eliminate this year in the new farm bill.

when crop prices are up and many farmers are making good profits -

will their subsidy payments reflect that profit?

Or will they get the same money as in “bad” times?

There are some problems with the farm safety net, but overall the effect of the subsidy system has been to create the most stable and affordable food supply in the history of the world.

mandates for bio-fuels didn't cause global food crises, but you downplay their effects in this commentary.

And you ignore the effects of subsidies.

Consider:

Last May 2007, Iowa State University's Center for Agricultural and Rural Development, released a report which estimated that the ethanol mandates have increased the food bill for every American by about $47 due largely to higher grain prices. The Iowa State researchers concluded that due to these higher food prices, American consumers are enduring a “total cost of ethanol of about $14 billion.” And that figure does not include the billions of dollars in federal subsidies for corn growers or the $0.51 per gallon tax credit that goes to the ethanol producers.

On April 7, Thomas Elam, an Indianapolis-based agricultural economist, released the report … estimates that the biofuels mandates passed by Congress will cost the U.S. economy more than $100 billion from 2006 to 2009. And it said that it is “inevitable that these costs will be passed along to consumers.”

from http://www.counterpu…

I hope subsidies will be re-considered in the new farm bill, but realistically, I predict not much will change.