1. Ethanol

2. The Production of Ethanol  Grown by farmers.  Shipped to special plants, where it is extracted by chemical process.  Although a new technology, not that sophisticated.

3. Disadvantages of Ethanol

4. The Disadvantages of Ethanol  Requires massive subsidies  More subsidies in future  Won’t end imports  Worsens air pollution  More expensive food

5. Requires Massive Subsidies 1)Ethanol is a massive subsidy program paid by taxpayers. 2)Between 1995 and 2005, we paid $51.2 billion to farmers to plant corn. 3)In 1995 alone, we paid them $9.4 billion.

6. Requires Massive Subsidies That $9.4 billion is almost twice as much as what was spent on WIC.

7. Future Massive Subsidies 4)To achieve President Bush’s goal, we will spend $118 billion in subsidies to farmers and ethanol producers by 2017.

8. Won’t End Imports 1)Ethanol produces less energy per gallon than gasoline. 2)If we converted the entire corn crop to ethanol, we would produce about 1.2 million barrels per day. 3)We import 10.1 million barrels per day.

9. Worsens Air Pollution 1)Use of ethanol would increase two of the worst air pollutants: nitrogen oxides and volatile organic compounds. 2)Gasoline mixed with ethanol increased VOC by 45%, compared to pure gasoline.

10. Higher Food Prices 1)Ethanol used about 20% of corn crop in 2006. 2)This added $47 to everyone’s food bill the following year. 3)The national effect is a $3 tax on each gallon of ethanol produced.

11. Higher Food Prices 1)Why the latter number? 2)Total food price increase: $14 billion. 3)Total ethanol produced: 5 million gallons.

12. Higher Food Prices 1)Ethanol production is adding to higher food prices globally, as more American corn disappears off of the market. 2)Has already lead to riots in Mexico.

13. Advantages of Ethanol

14. The Advantages of Ethanol NONE

15. The Advantages of Ethanol 1)Ethanol subsidies popular with corn farmers throughout country. 2)Farmers only 1% of population, but lots of them in key electoral states, such as Iowa.

16. The Advantages of Ethanol 3)Ethanol subsidies popular with certain, large companies that make large campaign contributions.

17. The Advantages of Ethanol 4)Pretend patriotism: our corn vs. their oil.

18. The Advantages of Ethanol 5)A “solution” that doesn’t require any change, or something new, or sacrifice.

19. The Advantages of Ethanol 6)Most people unfamiliar with the economics of it: popularity drops with knowledge.