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The Corn Mandate - the feds do force you to buy a product from a private corp.

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underpants Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 07:15 AM
Original message
The Corn Mandate - the feds do force you to buy a product from a private corp.
This article is actually about how Rick Perry's opposition to the Bush ethanol mandate might affect him in Iowa.

but at the end of the article some syrupy sweet truth


Until recently, the industry had zealously protected two federal government perks: a 45-cent federal tax credit for every gallon of ethanol blended into gasoline, and a tariff of 54 cents a gallon aimed at Brazilian sugar cane-based ethanol. But recession and deficits wore away political support, and both are set to expire at the end of the year.

What the industry still has, though, is far more valuable: the federal mandate that, this year alone, will effectively require almost 40 percent of American corn to be used to make ethanol for gasoline.

It is this law the one Mr. Perry, at least until recently, excoriated that is now clearly the bedrock issue for the ethanol industry, said Monte Shaw, executive director of the Iowa Renewable Fuels Association. Ethanol opponents also have this mandate in their sights, and have filed legislation to either eliminate it or suspend it when supplies of corn are running low.

The main reason to get rid of it, they say, is that it drives up food costs, and they cite the tripling of corn prices over the last half-dozen years.

One expert, C. Ford Runge, a professor of applied economics at the University of Minnesota, estimated that ethanol accounted for at least 25 percent of the rise in corn prices. In the current environment, the ethanol industry needs the mandate, if not the tax credit and tariff, he said.

Without any of these supports, Mr. Runge said, the industry would die a rapid death.

http://www.nytimes.com/2011/10/08/us/politics/in-iowa-e...



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ixion Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 07:20 AM
Response to Original message
1. using a food staple for an engine fuel is really, really stupid...
but that hasn't stopped Big Energy from pushing forward with it, nonetheless.
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MadHound Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 07:25 AM
Response to Original message
2. Actually they don't
You can still get no ethanol premium if you are will to pay the price. I purchase a couple of gallons every year to run my two stroke engines, like my chainsaw.

But as far as ethanol itself, it is a fraud and a scam. It drives up the price of food, it is forcing the price of farmland into a bubble, it doesn't work as advertised, and it needs to be done away with.
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underpants Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 07:28 AM
Response to Reply #2
3. I did not know you could still buy non-ethanol gas
my folks neighbor (no leftie) hates what ethanol does to small engines too.

Notice that they flood the market with corn eliminating the competition and POOF up go prices.
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MadHound Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 07:37 AM
Response to Reply #3
4. It is hard to find, I know of only two stations within twenty miles that sell the stuff
It is expensive, but cheaper than having to replace your carb in your two stroke engine every year. Ethanol is hell on two stroke engines.
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Cool Logic Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 08:15 AM
Response to Original message
5. Well, here is yet another example of an "evil" made possible by government intervention in business.
In every case that has been used by the statists as an indictment of the free-market and as an argument for a government-controlled economy, it was determined that the transgressions were made possible by government intervention in business.

The evils, popularly ascribed to "big corporations" are not the result of an unregulated industry, but of state power over industry. The villain is not the businessman; rather, it is the legislator. Likewise, our economic problems are not caused by free-market Capitalism, but by state coercion and force.





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izquierdista Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 08:25 AM
Response to Reply #5
6. Whose power over whom?
If you think the legislator just thought it up on his own to dump on unsuspecting businessmen, you're hopelessly naive. You can bet that businessmen wrote the legislation (to drive up demand for their product, corn), had ALEC submit it to Rep. Archer Daniels-Midland and Sen. Monsanto, and saw to it that their industry prevailed over the better sense of the state.

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Cool Logic Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 09:12 AM
Response to Reply #6
8. "You can bet that businessmen wrote the legislation..."
Actually, the legislation was most likely written by a former legislator, in an office on K-Street--the same place that they wrote the 71,684 pages U.S. Tax Code.

Why do you think 1% of the population controls 38% of the wealth? Answer: Because our legislators let them have it...and by default, they too, become part of the 1%.

A true free-market economy, is not controlled by the rich or by the poor; rather, it is controlled by the simple law of supply and demand. That means the rules are the same for everyone. However, when the market is overly-regulated by the legislator, consumers are not allowed to choose from the best products. Rather, they get to choose the products produced by companies with the best lobbyists. Or, as is the case with things like ethanol, we don't even have a choice. The same goes for the weapons of war we are forced to buy to wage the wars that our legislators initiate for them.

Crony capitalism is no free-market Capitalism. And while private free-markets are not immune from immoral and/or unethical business practices, their market relations are voluntary. In a free-market, people are not forced to deal with one another. On the other hand, in a state-controlled market, coercion and force are standard operating procedures.

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Odin2005 Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 09:01 AM
Response to Original message
7. Ethanol is a pork-barrel scam that makes people in the 3rd World starve.
:grr:
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Trillo Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 02:53 PM
Response to Original message
9. Is the only way to make money in business these days to have a government subsidy?
How many people are directly employed by the businesses receiving these subsidies? What I'm wondering is, what is the full-time-employment:subsidy ratio?

Is the subsidy going to a few folks who happen to own a lot of land, or are these subsidy receivers hiring a lot of full-time labor? Is their hired labor seasonal?
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kelly1mm Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Oct-08-11 04:29 PM
Response to Original message
10. Not really. You don't have to have a vehicle and even if you do you can go diesel or electric. nt
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