Best to Can the Corn
The development and marketing of energy sources ought to be driven by economic realities and market prices.
What Biden’s visit to Cree was meant to convey, in part, was this: if businesses play ball with us and conform to our political preferences, they’ll make money.
Here’s a brief but telling example of how public policymaking goes awry when anecdotes and show business supplant careful examination of actual data.
Any new fuel must pass two tests before people will use it as an alternative to conventional fossil fuels.
Environmental pressure groups constantly tout policies that would disproportionately hurt the poor.
Hog farmers, faced with ever more expensive feed corn, are turning to cast-offs from human snack and junk food producers to feed their livestock. Increased demand from biofuels—ethanol from corn specifically—production is making corn significantly more scarce and driving up price. To preserve our personal and economic freedoms, it's far better to let Wall St. rather than Congress give the production signals.
Here’s a brief but telling example of how public policymaking goes awry when anecdotes and show business supplant careful examination of actual data.
In his State of the Union address, President Bush called for an increased use of alternative fuels by American drivers. But entrepreneurs haven’t waited for this mandate. Across the United States, including North Carolina, alternative-fuel factories are springing up almost everyday.
This Free Market Minute is a carryover from the previous FMM, which discussed some of the issues surrounding a federal energy policy to increase the use and production of ethanol for fuel. Key ideas, missing in energy policies such as the new ethanol proposal, are that authentic market information as well as incentives matter in creating economic opportunity, wealth and prosperity throughout a nation. It's part of the mystery of capital and capitalism.
Food or fuel? This is the decision that policy makers appear to be facing in light of the U.S. government's announced policy to increase use of ethanol as a replacement for petroleum-based fuel in the United States. The government's policy means devoting more and more domestic agricultural assets to the production of corn for conversion to ethanol. We should consider both the vulnerabilities and the trade-offs associated with this decision.
We live and work today in an economy driven by fossil fuels. This is unlikely to change anytime soon, for basic reasons of engineering and economics.
Consumers and environmentalists might wish for substitutes, but the United States will depend on oil for some time.