The severe drought affecting the Midwest this year has caused the latest corn projections to be the lowest since 1995 [1].
With such a small corn crop, the government mandates that make some of
that corn be used for ethanol make even less sense, and will raise
prices even further.
The
drought has been a big news story for the network morning and evening
show in the past six months, earning 55 stories about facets of the
drought including struggling farmers, predictions of increased food
prices and coverage of wildfires. That figure did not include weather
reports that also often mentioned drought.
But
out of those 55 stories on ABC, CBS and NBC, ethanol from corn was
rarely mentioned -- just 13 percent of the time (7 out of 55), and not
all of those explained the ethanol mandates. Government mandates for
ethanol have been pushing corn (and other grain) prices up for years
now. But an explanation of government mandates that require billions of
gallons of corn ethanol be produced each year was very difficult to find
on the networks.
ABC’s
“Good Morning America” passed up a perfect opportunity to examine the
sense of the ethanol mandate on Aug. 18 when correspondent John
Schriffen discussed the drought and how it has pushed gas prices even
higher. Schriffen said, “So what’s caused the unpleasant end-of-summer
surprise? Refinery outages of the Midwest, rising crude oil costs, and
rising ethanol costs due to drought.”
The government requires that 13.2 billion gallons of corn ethanol be produced [2] in 2012 according to the Associated Press.
Although
such admissions were hard to find on network news programming, an
editorial published on Aug. 6 in The Washington Post acknowledged what a
problem the government mandate has been for the price of corn.
“Federally supported ethanol is a key factor in the steady rise of corn
prices since 2005; this year, with supplies likely to be short due to
drought, ethanol’s impact on prices will be magnified.”
Ethanol was blamed for global food riots in 2008, because, as ABC’s David Muir put it: “Many
farmers around the world, who once grew wheat and rice, now grow corn
and sugar cane instead to produce ethanol, a more lucrative market [3].”
Yet, in the past six months the networks could barely remember that the
ethanol mandates could make corn even more scarce (and therefore
expensive) during the current severe drought.
In
an exception to most of the drought coverage, ABC reporter Ginger Zee
showed just how dramatically the drought could affect prices and even
mentioned the government’s part in it on Aug. 10 “World News with Diane
Sawyer. Zee noted that “One estimate, an additional $300 to feed a
family of four over the next year. That’s 75 bucks for every man, woman,
and child. It’s not just food. Its fuel, bio fuels. By law, about 40
percent of the US feed corn is used to make ethanol, making shortages
worse.”
As BMI has reported the news outlets once praised ethanol [4].
When ethanol was first introduced to the scene, all three media outlets
were overly enthusiastic about this supposedly green fuel. Katie Couric
proclaimed it to be "the wave of the future." In 2010, however, the media’s attitude [5]
changed towards ethanol as the prices of groceries began to rise and
the media finally realized the global and environmental costs of ethanol
requirements.
A study [6] released
on Aug. 10, 2012, by Dr. Salim Furth and Alex Entz of The Heritage
Foundation, criticized the mandates for hurting everyone during the
drought. “Under a free market system, the pain of the drought would be
spread around—corn growers, livestock farmers, fuel producers would earn
a little less than usual, and the consumers of corn, meat, and gasoline
would pay a little more … A government mandate, by contrast, fixes
quantities and forces prices to rise rapidly when nature reduces the
supply. In this case, livestock farmers and corn consumers—including the
poor in America and abroad—bear the brunt of the inflexible ethanol
mandate.”
Surprisingly, even the U.N. wants a “temporary” end to the mandate. They released a statement [7] on Aug. 10 calling
for the U.S. government to issue an “immediate, temporary suspension”
of the ethanol mandate. José Graziano da Silva, the director general of
the U.N.’s Food and Agriculture Organization, argued that this mandate
will cause the drought to become a food shortage that is avoidable, if
only this mandate is suspended.
According to Kenneth Green, a resident scholar and environmental scientist at American Enterprise Institute, it is “universally acknowledged [8]” that ethanol has caused food and gasoline prices to rise. Fox News.com reported that the EPA [9]
is being pressured to reconsider the ethanol mandate, because of the
drought. As of Aug. 10, 25 U.S. senators from both the Republican and
Democrat parties have signed a letter addressed to the EPA asking the
agency to reconsider its ethanol mandate. Additionally, 156 bipartisan
members of the House of Representatives sent a petition [10] to the EPA on Aug. 1, according to Newsmax.
