Drunk on Ethanol

I took her advice, learning that soil is being lost from corn plantations about 12 times faster than it is being rebuilt, and that meeting the fuel requirements of just one year's worth of U.S. population growth with straight ethanol (assuming each baby lived 70 years), would cost: 52,000 tons of insecticides, 735,000 tons of herbicides, 93 million tons of fertilizer, and the loss of 2 inches of soil from the 12.3 billion acres on which the corn was grown.

After all the soil, nitrogen, and pesticides reach the Gulf, they help create a poisoned, deoxygenated, algae-clogged, bacteria-infested "dead zone" that's lethal to fish, crustaceans, mollusks, and virtually all gill breathers. In some years, depending on water conditions and spring and summer heat, the dead zone can be bigger than the state of Massachusetts. The U.S. Geological Survey reports that more than half of the 1.6 million metric tons of nitrogen that enters the Gulf comes from fertilizer. According to a research team funded by the National Oceanic and Atmospheric Administration, a 30 percent reduction in nutrient loadings over five years could shrink the dead zone by 20 percent to 60 percent. Yet in the face of this finding, the states and the feds are encouraging the increased production of unneeded corn.

Wetlands—the most productive fish and wildlife habitat there is—consume nitrogen and filter out pesticides and sediments, but wetlands are being drained in order to produce surplus corn. The Corn Belt has lost about 70 percent of its wetlands. In some areas, such as Nebraska, corn has to be irrigated by pumps that suck water from the ground faster than it percolates back in. Moreover, the pumps are powered by natural gas, the frenzied production of which is creating horrendous problems for fish, wildlife, and livestock (see "The Mad Gas Rush," March 2004).

According to President Bush's own Department of Energy, the national mandate sought by the administration to ramp up ethanol production to 5 billion gallons a year by 2012 could increase the cost of gasoline by 10 cents per gallon.

But ethanol's cost to Americans goes beyond the loss of fish and wildlife, beyond compromised air, water, and soil. The approach has been: Don't invest to make ethanol more affordable; pour corporate welfare into ethanol producers to make unoxygenated, cleaner-burning gasoline less affordable. For instance, gasohol gets a per-gallon tax break of 5.4 cents from the 18.4-cent federal gasoline excise tax. And companies that blend ethanol get federal tax reductions. Some Corn Belt states make direct payments. For example, Minnesota awards ethanol manufacturers a 20-cent-per-gallon "producer incentive," by which strategy it boosted the state's annual ethanol output from 1 million gallons in 1987 to 380 million gallons today.

In 2001 South Dakota handed out $3.1 million to ethanol plants in just three towns. Nebraska is equally generous. For each gallon of ethanol produced, taxpayers pay about 60 cents in federal subsidies and 20 cents in state subsidies. And on top of this the Farm Security and Rural Investment Act of 2002 provided corn growers with $26 billion in direct subsidies over six years.

The main recipients of all this state and federal loot aren't family farmers but bloated agribusiness corporations. For example, the nation's biggest ethanol producer, Archer Daniels Midland, has received at least $10 billion in subsidies since 1980. ("We have to have tax incentives . . . to make that [ethanol] program work," it explains.) According to one estimate—by financial analyst James Bovard of the Cato Institute—every dollar in profits earned by ADM costs taxpayers $30.

ADM oils the pork conveyor belt by contributing lavishly to whatever party is in power or looks as if it might be coming into power. Since 1988, ADM, its subsidiaries, and the family of ADM's former chairman, Dwayne Andreas, have given about $2 million in soft-money contributions to Republicans and about $1.1 million to Democrats. The strategy gets results. In 1994, a few days after Andreas cut a $100,000 check at a presidential fund-raiser, President Bill Clinton tried to push through a rule requiring that about 10 percent of all gasoline contain ethanol, explaining that the mandate would create "thousands of new jobs" and be "good for our environment, our public health, and our nation's farmers." Two years later ADM pled guilty to price-fixing for nonethanol products and paid a fine of almost $100 million. Nonetheless, both political parties continued to accept ADM donations.