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by wallacoloo 1612 days ago
i always assumed ethanol production was encouraged by the govt precisely to spur excess production of corn so as to make our food production more robust. i.e. during a bad year of food production, halt ethanol production and redirect that excess of corn back into the food supply; crisis averted. is that not the case?
5 comments

Subsides are never such simple handouts.

Corn and ag subsidies have as much or more to do with govt "buying" surplus and "selling" it to foreign countries as part of aid packages. And dominating the world grain market, which gives the US even more indirect control over foreign grain growing capabilities, making others reliant on the US. (Bc investing in local production is risky when the US can just flood the market.)

Separately, most corn grown for ethanol or animal feed isn't going to directly be rerouted to food supply, unless we approach a full collapse type situation (and even then, it would be more market and regulation collapse and black market emergence than due to policy changes).

But keeping those farmers in business and capable of growing table corn next season (with minimal capital investment or changes to practices required) accomplishes roughly the same thing.

There was a time when I wasn't a fan of the government subsidizing farmers with policies like that, but the cost of underproduction of food is too high, and it's not a problem markets will solve, so it makes sense for governments to step in and overproduce food.
Ethanol is used in gasoline because MTBE is environmentally persistent.
For anyone else who was unaware: https://en.wikipedia.org/wiki/MTBE_controversy
the corn used for ethenol is not the same corn used for consumption.
Is it? I get it's not sweet corn (ie. corn on the cob or canned/frozen corn), but it should still be starchy and edible (think tortilla corn).
It's because Iowa has a law saying their presidential primary must be first.