Unveiling the Light

The United States gets accused of many evils and usually these charges are false. The fact is that being the biggest, most powerful, and most affluent in the world brings out jealously and rivalries in others and most would love to see us fall. Unfortunately there is one area in which we are very guilty lately and it brings forth the only time I can think of that, to my great surprise and horror, I find myself in agreement with, of all people, Fidel Castro.

Fidel warned the world that the new U.S. policy of promoting the use of ethanol would cause millions to starve. He is right. Already we have seen great increases in domestic food prices and overseas there have had riots in some countries as the price of rice and wheat rise precipitously. We have been for some time the great food basket of the world. Now, not only do we divert tens of thousands of acres of food production to the making of fuel, but we do so while paying farmers to leave much of their good farmland unused. Congress blew it. They failed to understand the basics of economics. Increase demand for a product and restrict supply and not only will prices go up but when it comes to food, the poor suffer the most.

Since congress decided to subsidize the making of ethanol to the tune of well over one dollar per gallon of our tax money, while making its use mandatory for domestic fuel, it is responsible for the suffering we see throughout the world. Any economist could have told them their actions would result in steep price increases and shortages. What’s worse is the wide spread effect of their action. They probably only thought about the price of corn going up because they failed to anticipate that grain and other crops would be diverted causing shortages in crops across the board, that feed for cattle and milk cows would go up thus causing the price of meat, milk and cheese to rise, and that many petroleum products would be devoured to produce this corn that would be turned into a substitute for oil. In effect, Congress failed to think out its policy. Instead it is debating steroid use in pro baseball as of this is a national crisis while ignoring the real crisis of $4.00 per gallon fuel prices and people going hungry because of their actions and inactions.

What makes this doubly sad is that the so called solution found in ethanol products is no solution at all. It is estimated that if every inch of farmland in the United States was changed over to produce ethanol, we would meet less than 10 percent of our national consumption. The fact is that our farmland should be used to making food, not fuel. The ironic part is that we have fuel sources. We have oil in Alaska, Nebraska and off shore that we refuse to drill for because we fear damage to the environment, damage that is always overestimated. Go to Alaska where the Exxon tanker spill was declared a disaster of mega proportions and you cannot see any lasting effects. Go to San Francisco Bay and try to find evidence of our most recent spill. You can’t. Such damage tends to be transitory and falls far short of the disaster stories we see on TV and are warned about.

Our failure to drill for our own oil is counter productive anyway. We fear what a pipeline in Alaska might do, even though we have already had experience in such pipelines and no damage to nature occurred; but we ignore the danger of supertankers carrying oil thousands of miles across our oceans and to our coastlines. We also ignore the obvious danger we create as we pay the most radical elements of the world for needed oil when much of that money ends up funding terrorist activities meant to kill Americans.

A smart policy would be to push the development of real alternative fuels but to realize that their coming onto the market in large quantities is decades away. The alternatives we have now in wind and solar power are good but very limited. In the meantime, we need oil and it makes no sense to transport that oil thousands of miles over the ocean and to buy it from our enemies when we can pay our own American brothers and sisters to find and drill for it right here on our own lands.

A good and smart policy would allow farmers to go back to growing food, would quit paying farmers to leave land fallow, would take full advantage of the oil we have in our own country and would fund the development of alternative fuels. If we let the industry drill for oil where we know it is, in the Midwest, in Alaska and off our coasts, if we build some nuclear plants and if we quit programs that divert food crops to fuel alternatives and keep good farmland from being used, we could afford to fund a great deal more research into alternative fuels. We could cut the price of food down, cut by two thirds the price of oil, and afford to have a reasonable fuel tax of say 25 cents to fund research and development.

We should also realize that big oil is quite happy with the current policies. They have failed to build a new refinery in decades because that allows them to restrict supply and keep prices up. They don’t mind shortage of supplies because they profit when oil prices shoot up. During all of our shortages oil profits only go up, as does the revenue of the government which collects a percentage off the top. We could go in and create more competition by some anti trust moves to separate the distribution of fuel from the refinery and drilling processes. Break up the big oil companies and let competition reign. It is amazing what happens when we allow capitalism to work and quite distressing as to how fouled up things can get, like now, when the government tries to control everything.

Let’s tell congress to get off its duff and give us some real energy legislation. Either that or we should vote them all out. I for one do not believe gas should be anywhere near $4.00 per gallon and I deplore that our policies will lead to the poor starving. All the while our government and big oil; as well the big farm corporations that receive most of the government handouts, all grow richer while our budgets get stretched. We deserve better government than this. Unfortunately it is the government we have given ourselves. You know something is wrong when I agree with Fidel Castro. That in itself is proof that our government had turned the world upside down.

Let’s get back to sensible decisions based on real economics. Then we can work to make this a better world. Right now we are doing more harm than good and that is a sin.