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A> The subsidy for ethanol only amounts to a shift. The increased demand for Corn has driven the prices up to a point where the government will not be paying a subsidy to farmers.
B> A great American hypocrisy: People love to express sympathy for the poor family farmer who has trouble holding on to his land because of low crop prices. However, they scream to high heaven whenever the prices at the grocery store go up.
I agree that the gluttony of the American consumer is largely to blame for the state of fuel prices. However, that is not a legitimate argument against the introduction of alternate fuels. Your increased grocery bill is also not a reason that the US farmer should, for the first time in nearly a century, receive a fair market price for a commodity. You didn't complain when the government kept food prices artificially low but you cry foul when they do the same for fuel? Where is the consistency there?
Finally, the use of ethanol subsidies is not the cause of high corn prices in Mexico. Corn is native to Mexico, not the United States. If not for a corrupt and oppressive system of government that stifles the ability of the Mexican farmer to maximize efficiency they could easily support their own corn consumption. It is in no way the fault of the American farmer, the American government, or the American ethanol industry.

Here are the subsidies: 1 monopoly. Many states are requiring Ethanol as an additive to gasoline. 2. forign ethanol is subject to a 54-cents-per-gallon tariff and a 2.5 percent duty. 3. 51 cent per gallon subsidy on the production of ethanol.

Without these Ethanol wouldn't be produced with corn anywhere. The BTU gain is too small if it exists at all..

So I think my point stands. America is burning food because of public policy.

Yes, Mexico probably could grow it down there.. And they likely will if the prices stay where they are. With NAFTA corn is corn however, and the fact of the matter is that they have been importing it from the US for quite some time. Our agribusiness infrastructure is fairly efficient.

I am sure that our corn tortillas have gone up in price as well, probably at a simular rate. We are burning our food to run our Hummers.

We are not burning our food. We are burning excess food. Why do you support a controlled-market system for farmers but you are against it for energy? For the first time in close to a century the American farmer is about to experience free market benefits and people are against it. The American family farm, which was still thriving forty years ago, has been driven to near extinction because of market controls. The prices paid for farm goods in this country have not kept pace with inflation while the costs of farming have. This in not an accident. It is due to federal government policies aimed at keeping the price of consumable food at an unnaturally low price. As a result the family farm has been replaced buy industrial farming in order to remain profitable. 2007 will likely be the first year in the past couple of decades that growing grain corn on a small scale will be profitable.
Twice in previous comments I have pointed out that the ethanol subsidy is not a new subsidy. It is merely a shift of an existing subsidy from corn to ethanol. You have yet to acknowledge that point.
Finally, I question the BTU gain theory. We are not adding farm ground to produce corn for ethanol. Therefore the energy used to produce, harvest, and transport the corn should not be counted against the BTU total of ethanol because that energy would have been expended regardless of ethanol production. Any calculation that includes said energy consumption is intellectually dishonest. The efficiency of the ethanol distillation process is advancing quite rapidly. We are already seeing GMO corn with a gene for producing the enzymes required for ethanol production thereby eliminating expensive steps in the distillation process. In the current process enzymes are added to the corn twice, once before each cooking step. With the GMO corn no enzymes are added (or transported) and one cooking step (the hotter of the two) is removed. This allows for cheaper, faster, and less energy intensive distillation of corn into ethanol. I believe in a very short time you will see the energy requirements for producing ethanol cut in half. That will also result in reduced cost of producing ethanol. That should result in a lower subsidy payout to the ethanol producers.

I am all in favor of free market economics. This isn't it.

On the first point, we may be only burning our excess food supply, but that excess we usually exported to Mexico and other countries that are more needy than we are. Thus the crisis. Mexico had a affordable source of corn, now they don't. I have difficulty justifing making people hungry in order to reduce my fuel bill.

As far as the shifting subsidies, I think it is more noble to subsidize the production of food than it is to subsidize the production of fuel. Without food, people starve without fuel, people pollute less, exercise more, and form tighter communities. I would prefer a system that is totally free market, but I can understand why some subsidies are needed on occasion.

The same arguement stands for the BTU's If we spend BTU's feeding people, that is noble if we spend BTU's creating a fuel that has no real advantage other than being not gasoline, then it is substantially less noble.

I do believe that the increased demand for Corn will lead to more farm land being developed and farmed, or shifted from other crops.

I have yet to see any solid argument for ethanol that is not smoke and mirrors. There is less energy, the reduction in pollution is negligible. And we are spending fossil fuels to make it, so it really doesn't change our energy dependence significantly. Even if it was efficient, we don't have enough farm land to make a dent in our energy needs.

Everything I have read in the last 8 months or so indicate that Ethanol is actually driving up our cost at the pump.

If a significantly net positive BTU Corn ethanol can be developed, I am all for it. But I think it is important that we feed people before we feed Suburbans and Hummers. I say we tax the gas guzzlers to subsidize gas for the rest of us, and to insure the food supply for the third world.

Yowsers, Now I am a liberal.. How did that happen??