Home
/
RELIGION & LIBERTY ONLINE
/
Beginning of the End of Corn Ethanol?
Beginning of the End of Corn Ethanol?
Jan 29, 2026 2:30 AM

Ethanol subsidies, once considered a sacred cow, are facing the possibility of being axed from the budget. The Senate cast a deciding vote, 73-27 in repealing the 45 cent per gallon subsidy to refiners for blending gasoline with ethanol, and the 54 cent per gallon tariff on imported ethanol.

Cutting the ethanol subsidy and repealing the tariff still face an uphill battle as it must pass the house and get the signature of President Obama, who has vowed not to fully repeal the subsidy. Supporters of ethanol are fighting harder to preserve the subsidy and tariff, and are now issuing claims that the ethanol subsidy keeps gas prices lower than what they would be if the subsidy wasn’t in place.

Iowa State University released a study arguing that ethanol has helped suppress gasoline prices. It is of no surprise that supporters of the ethanol subsidy and tariff have embraced the study by Iowa State University with open arms and are using it to add weight to their position.

Unfortunately for supporters of the ethanol subsidy, the Institute for Energy Research, released its own study debunking the arguments from Iowa State. While the Institute for Energy Research admits that removing the ethanol subsidy will result in a short-term spike in gasoline prices, they argue that in the long run consumers are better off without the ethanol subsidy–ideally the country would’ve been better off if the subsidy had never existed.

Those who claim that removing the ethanol subsidy and tariff will increase gasoline prices also fail to acknowledge principles of basic market economics. By removing the tariff, the United States is able to import cheaper ethanol from countries like Brazil, which produce the cheaper sugar-based ethanol, thus making ethanol more affordable for consumers. As a result, the market adds a product pete with gasoline, and petition, may drive the price of gasoline lower.

The concept petition driving down prices is explained by Joel Velasco, former chief representative in North America for the Brazilian Sugarcane Industry Association. Velasco argues petition between corn and sugarcane ethanol will benefit consumers. The principle petition found in his argument can be applied petition between gasoline and ethanol as well.

While it may seem like ethanol from Brazil is a perfect solution, there are unintended consequences that must be weighed. Ecology professor at the University of São Paulo in Brazil, Luiz Martinelli, warns of the many problems with Brazilian ethanol in an article published in the Cornell Daily Sun. Martinelli explains that ethanol production pollutes the environment and results cause serious problems:

Ethanol production fosters deforestation in Brazil. Sugarcane needs a well-defined drought season to concentrate sugars in the cane stalk, making the wetter Amazon region less than ideal for growth. Consequently, growers convert increasing areas of land in the transitional area between the cerrado grasslands and the Amazon forests to sugarcane. As a result, the increase may indirectly lead to deforestation as other crops, like soybean, are pushed into the Amazon.

“We don’t have much room for deforestation. If sugarcane causes 1,000 of squared kilometers of deforestation, we’ve set off any savings [of avoided carbon emissions] that we have saved,” emphasized Martinelli.

Such unintended consequences were also articulated by Ray Nothstine on the PowerBlog in 2007 as religious leaders began to express alarm about increasing ethanol production:

Religious leaders are speaking out. In March, Roman Catholic bishops in Brazil warned that a rapid increase in ethanol production based on sugar cane could lead to widespread deforestation, massive relocation of workers and munities, and harsh working conditions for cane cutters. Analysts predict that Brazil, the world’s largest exporter of ethanol, may increase ethanol production as much as 40 percent in the next four years. “We are going to turn the country into a huge cane (plantation),” said Cardinal Geraldo Majella Agnelo. In Colombia, Christian aid organizations say armed groups are driving peasants off their lands to make way for plantations of palm oil, another biofuel. Acreage dedicated to production of the palm oil tree has more than doubled in the last four years.

Nothstine later explains in “‘Big Corn’ and Unintended Consequences” how corn ethanol will increase food prices, is more costly to produce and transport, and has pollution problems.

If ethanol made from sugarcane gains traction in the United States and other countries, the same questions that have been raised by corn ethanol must also be asked when es to sugar-based ethanol. Will we have a problem with unintended consequences? Will sugar ethanol contribute to rising food prices in a manner similar to that of corn ethanol? What effects will sugar ethanol have on the environment, and what are the impacts of deforestation?

Comments
Welcome to mreligion comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
RELIGION & LIBERTY ONLINE
The failure of ‘good intentions’ in America’s entitlement state
Amid the flurry of anti-poverty activism gone wrong, we are routinely reminded thatgood intentions aren’t enough. Although the motives of our hearts often serve as fuel for positive transformation, our corresponding efforts also require reason, wisdom, discernment, and a healthy recognition of real-world ripple effects and constraints. In public policy, we see an unfortunate mix of good intentions and unintended harm across a range of issues, from disaster relief to foreign aid to healthcare policy and beyond. At present, however,...
Walmart removes hammer-and-sickle merchandise
After backlash from across the globe, Walmart has stopped selling items bearing the hammer-and-sickle insignia of the Soviet Union. This followed strongly worded letters from Baltic leaders and a U.S. educational effort largely spearheaded by Mari-Ann Kelam through the Acton Institute. The controversy burst into public consciousness when Kelam wrote an Acton Commentary titled, “Walmart’s T-shirt homage to mass murder,” published on September 5. A number of news outlets picked up the story, both in print and on radio. Lithuania’s...
Amazon paying higher wages is smart—forcing everyone to do so is dumb
Amazon recently announced pany will pay all of its U.S. employees a minimum of $15 an hour—more than double the federal minimum wage of $7.25. “We listened to our critics, thought hard about what we wanted to do, and decided we want to lead,” said Amazon’s founder and CEO Jeff Bezos. “We’re excited about this change and encourage petitors and other large employers to join us.” The decision is a smart move for Amazon. Unfortunately, the pany wants to force...
Jesus would vote for socialism: German socialist party
Marxism taught that religion is the opiate of the people and tried to indoctrinate children in atheism from their earliest days. Yet a socialist party in Germany has erected a billboard stating, “Jesus would have voted for us.” The fifth-place party in the German Bundestag, Die Linke (“The Left”), “is the direct successor of the Socialist Unity Party of Germany (SED) which held East Germany in an iron grip for many decades,” writes Kai Weiss of the Austrian Economics Center....
Russell Kirk: Where does virtue come from?
This is the first in a series celebrating the work of Russell Kirk in honor of his 100th birthday this October. Read more from the series here. How can human society form and raise up virtuous people? In the Summer/Fall 1982 issue of Modern Age, Russell Kirk explored this perennial question in an essay titled, “Virtue: Can It Be Taught?” Kirk defined virtues as “the qualities of full humanity: strength, courage, capacity, worth, manliness, moral excellence,” particularly qualities of “moral...
Explainer: What you should know about the U.S.-Mexico-Canada Agreement (USMCA)
What just happened? Shortly before midnight on September 30, the United States and Canada agreed to a deal to replace the North American Free Trade Agreement(NAFTA). The new trilateral trade agreement is called the United States-Mexico-Canada Agreement (USMCA). When does it take effect? Before it can take effect, leaders from each of the three countries must sign it and get it approved by their nation’s legislatures. Because this process is expected to take several months, the main provisions of USMCA...
C.S. Lewis on the necessity of chivalry
There are few concepts today more dismissed—and yet more necessary—than chivalry. During the Middle Ages chivalry was a moral system bined a warrior ethos, knightly piety, and courtly manners. As C.S. Lewis writes in “The Necessity of Chivalry“—my favorite essay of his—the medieval ideal brought together fierceness and meekness, “two things which have no natural tendency to gravitate towards one another.” “It brought them together for that very reason,” says Lewis. “It taught humility and forbearance to the great warrior...
This politician nails entrepreneurship and the importance of work
The news highlights from Theresa May’s speech this morning at the Conservative Party’s 2018 conference may be that she branded Labour the “Jeremy Corbyn Party” mitting her party to “ending austerity,” increasing spending on the NHS (which, she said, “embodies our principles as Conservatives more profoundly” than any other institution), and suspending the national gasoline tax for the ninth year – a move that saved British taxpayers £9 billion a year. But there’s a section noteworthy for its rarity in...
Why you should diversify your investments
Note: This is post #95 in a weekly video series on basic economics. Before it went bankrupt in 2001, many of Enron’s employees had most or all of their retirement funds pany stock. When pany collapsed, as Alex Tabarrok notes, employees who were once multimillionaires ended up with almost nothing. They failed to heed the most basic rule of investing:Don’t put all your eggs in one basket. In this video by Marginal Revolution University, Tabarrok explains why diversification is essential...
8 quotations from Walter Laqueur on Europe’s future, statism, and the allure of evil
One of the preeminent international analysts and students of the transatlantic area, Walter Ze’ev Laqueur, died Sunday at the age of 97. Born on May 26, 1921, in what was then Breslau, Germany (and now Wrocław, Poland), he fled his homeland days before Kristallnacht; his family would die in the Holocaust. He moved to an Israeli kibbutz, to London, and eventually to the United States – moving as seamlessly from journalism, to foreign affairs, to academia. He spoke a half-dozen...
Related Classification
Copyright 2023-2026 - www.mreligion.com All Rights Reserved