Smart Growth

Pouring Biofuel on the Fire

Hunger. Corruption. Bankruptcy. Other than that, the green-fuel boom has been a smashing success.

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Henry Ford envisioned ethanol as the "fuel of the future"; his Model T ran on ethanol and petroleum.

The International Energy Agency forecasts that conventional oil production will peak by 2020, with massive price increases preceding the peak.

Before Congress passed expanded ethanol subsidies in 2005, the US produced nearly 4 billion gallons of corn ethanol. In the first 9 months of last year, production reached nearly 7 billion gallons.

Archer Daniels Midland controls 10% of the US ethanol market.

Former adm ceo Dwayne Andreas, whose donations to Nixon were linked to the Watergate break-in, is one of the nation's top political contributors. Since 2000, adm, its pacs, and its employees have given $1.4 million to Democrats and $2.1 million to Republicans.

As a senator, Barack Obama sponsored ethanol legislation and flew twice on adm's corporate jet.

Food prices have risen 130% since 2002. The World Bank estimates that up to 75% of the increase is due to demand for biofuels.

There were food riots in at least 30 countries in the past 2 years. More than 40 people were killed when Cameroonians protested rising prices.

The US government spent $9.2 billion on ethanol subsidies in 2008. It spent $1.5 billion on food aid.

Clearing grasslands to plant biofuel crops releases 93 times as much greenhouse gas as will be saved by the fuels grown on the land each year. Destroying Indonesian peat bogs releases 420 times as much.

New European Union guidelines limit subsidies for biofuels that don't comply with environmental standards; Switzerland only subsidizes fuels that emit 40% less greenhouse gas than fossil fuels.

After ethanol prices fell by nearly half last year, several just-built plants filed for bankruptcy.

Obama's staff has consulted the Renewable Fuels Association, an adm-led trade group, on how to craft an ethanol bailout.

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