Ethanol and Rendell

Many are calling for an end to ethanol mandates because of how they drive up food costs:

Aid workers and others contend diverting more than a a quarter of the U.S. corn harvest to make ethanol is making food much more expensive the world’s poor. A leading agriculture research group said a moratorium on grain- and oilseed-based biofuels would help cut crop prices substantially.

“Our models analysis suggest that if a moratorium on biofuels would be issued in 2008, we could expect a price decline of maize by about 20 percent and for wheat by about 10 percent in 2009-10. So it’s this significant,” Joachim von Braun, heads of the International Food Policy Research Institute, told reporters in a briefing.

Meanwhile, Governor Rendell is calling on more mandates for ethanol use and taxpayer subsidies for producers. He also calls them “more cost-effective” – yet they need taxpayer subsidies to compete.

Read John Lott’s commentary on ethanol, and check out our Policy Point on energy.