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Ethanol Self Interests Will Always Win
Submitted by Truffle Media N... on November 28, 2010 - 10:30pm.
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via online.wsj.com
Former Vice President Al Gore has come out with an admission that his view on ethanol and its potential to be a solution for the world's energy issues was wrong.
Mr. Gore hinted at more than just flawed reasoning at last week's "green energy" conference in Athens, stating: "One of the reasons I made that mistake is that I paid particular attention to the farmers in my home state of Tennessee, and I had a certain fondness for the farmers in the state of Iowa because I was about to run for president."
Mr. Gore is now suggesting that such an energy source should not have government subsidies. "It is not a good policy to have these massive subsidies for first-generation ethanol," he said to a green energy conference in Athens, Greece late November.
Will the ethanol subsidies expire at the end of the year? Most likely not. But the admission from Mr. Gore supports the notion that governments don't always support initiatives because of social and environmental good. Governments will respond to strong lobbyists.
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My understanding of economics isn't that great, but it seems that encouraging growth of 1st gen biofuels through subsidies has had a real effect on research on next gen biofuels. Without the subsidies for grain ethanol, I don't know if we'd have as many companies and scientists working on biomass, algae, waste, etc biofuels. I feel that Gore and many others are being really short sighted on this. Instead of a call to end ethanol subsidies, let's call to switch those funds (and some funds from oil subsidies, too) to help those next gen efforts that have already made so much progress to commercial production.
Thanks for the comment. Much appreciated.
I am not an economist either. The complexity of Congress and the relationships developed by lobbyists and constituents makes it difficult to know all the consequences or benefits from any funding:)
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