Category Archives: markets

Food or Fuel?

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That’s the choice being forced on Americans by the push for “clean” fuel for our cars, even as the Left and the Progressive-Democratic Party push for elimination of gasoline-burning cars. Dave Loos, Illinois Corn Growers Association’s Director of Biofuels and Research, actually is proud of that diversion of food to fuel.

Illinois has 13 ethanol plants that can produce 1.6 to 1.7 billion gallons of ethanol annually.

A bushel of corn produces 2.8 gallons of ethanol. That’s roughly 590 million bushels of corn diverted from food in Illinois alone. Illinois corn farmers produced 2.13 billion bushels of corn in 2019. The equivalent (because it’s not only Illinois corn in those plants) of more than 27% of Illinois’ corn production is diverted away from food production in Illinois’ plants.

Food or fuel? Food—corn—diverted from Americans’ tables and from ranchers’ animal feed (and so diversion of meat from Americans’ tables) is being sacrificed to produce ethanol for vehicles that are intended to not exist in any great number in a few short years.

And this doesn’t address the environmental and economic damage done by the Renewable Fuel Standard—the Federal government’s ethanol mandate. From Environmental outcomes of the US Renewable Fuel Standard, published in the Proceedings of the National Academy of Sciences last winter:

[T]he RFS increased corn prices by 30% and the prices of other crops by 20%, which, in turn, expanded US corn cultivation by 2.8 Mha (8.7%) and total cropland by 2.1 Mha (2.4%) in the years following policy enactment (2008 to 2016). These changes increased annual nationwide fertilizer use by 3 to 8%, increased water quality degradants by 3 to 5%, and caused enough domestic land use change emissions such that the carbon intensity of corn ethanol produced under the RFS is no less than gasoline and likely at least 24% higher.

That’s an example of the irrationality of Left and of their politicians.

Bias and Gun Trafficking

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Dan Frosch and Zusha Elinson had a piece on illegal gun trafficking in last Thursday’s Wall Street Journal in which they decried the degree of illegal trafficking, especially across State borders. In the graph below, they particularly called out five States as being particularly egregious sources of this interstate trafficking.

Sadly, their article exposes more about the press’ bias in reporting on guns and (by their implication from their trafficking emphasis) on gun control.

No doubt gun-trafficking is a serious problem.

However, some context is informative, also; it took me about 10 grueling seconds to conduct the Bing search that turned up this context from the year following Frosch and Elinson’s graph.

  • 5,000 guns trafficked out of Texas against 1.6 million guns sold in Texas in 2021.
  • 6,000 guns trafficked out of Georgia against 496 thousand guns sold in Georgia in 2021.
  • 4,800 guns trafficked out of Arizona against 480 thousand guns sold in Arizona in 2021.
  • 4,700 guns trafficked out of Virginia against 620 thousand guns sold in Virginia in 2021.
  • 4,300 guns trafficked out of Florida against 1.4 million guns sold in Florida in 2021.

It’s interesting that Frosch and Elinson chose to elide this context-providing information.

On Governor Newsom’s Plan to Produce Insulin

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Regarding that idea, a letter writer in The Wall Street Journal‘s Tuesday Letters section offered this after suggesting that Newsom’s effort would have the salutary outcome of demonstrating the foolishness of such a move:

Targeted subsidies for at-risk populations cost a fraction of the investment needed to bring “affordable” medications to the people….

That’s true enough, could Government actually do that and, further, keep it limited to the truly at-risk. However, actual competition in the market is free, and that brings down costs for everyone. Additionally, that competition allows far better and more accurate identification of those remaining few at-risk who still can’t afford their meds and would be legitimate targets of largesse. That also would facilitate more effective use of sources of largesse, beginning in order with family and friends first, followed by church and local charity, local community, county, then state governments, with the Feds last on the list, rather than the default source.

Sue, Settle, and Biden’s Demand for Producers to Produce

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There was a time when a million acres of land were available in California for oil and gas leasing and hydraulic fracturing (fracking).

Then California’s Attorney General, Governor, and “other state agencies” sued, claiming that the Bureau of Land Management’s environmental impact analysis was inadequate. BLM then settled. Under the terms of BLM’s sue-and-settle agreement,

until the Bureau conducts a supplemental environmental review of the project, new oil and gas leases will not be granted in central California….

Three guesses when that review will be begun, and you get a pass on the first two.

This is the duplicity with which President Joe Biden (D) inveighs against oil and natural gas producers for not producing more.

To Repeat

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In a Wall Street Journal article centered on the problems volatile energy prices cause for central banks, there’s this allegation:

The pass-through of higher energy prices to other goods and services, along with their volatility, could make it harder for the Federal Reserve to tell what price shocks are temporary and thus set interest rates appropriately.

Wrong answer.

I’ve said it before, but it bears repeating. Instead of trying to play the market, or even to time it, the Fed needs to set its benchmark interest rates at levels historically consistent with the 2% inflation rate that it’s historically used for its target inflation rate, and then sit down and shut up.

Full stop.