Tuesday’s Top Pick 3 Round 7

3rd Place: GOP3

Alternative Fuel Subsidies Cause Sober Germans, Starving Mexicans, More Pollution

We first saw negative effects of our global market meddling when 75,000 starving Mexicans began rioting:

Poor Mexicans rely on tortillas for their diet. And a lot of other poor people in a lot of other places rely on other foodstuffs made from corn.

The problem is ethanol. Ethanol, that fuel additive that reduces pollution and helps us wean our dependency on foreign oil and makes farmers rich and politicians look silly when they stump in Iowa. As the U.S. adds more ethanol to its gasoline, the price of corn is surging dramatically, leading to extreme market volatility.

Now government subsidies for alternative fuels have caused a sobering increase in the cost of beer in Germany due to the unnatural shrinkage of barley production. Why is barely production lower and beer more expensive? The farmers are switching production so they can get more government alternative fuel subsidies.

Germans will have to dig deeper in their pockets to enjoy their beloved beer in the next few months as barley is increasingly displaced in the country’s fields by heavily subsidized crops used for biofuels.
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Brewers and farmers say an extremely poor barley harvest in 2006 has exacerbated an emerging trend of converting barley fields to growing the plants used in biofuels, such as rapeseed. The amount of land used for growing barley in Germany is receding by 5 percent a year.
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But the price of barley, which is used to make malt, an essential ingredient in brewing, has doubled in the space of a year from 200 to 400 euros per ton on the German market.

The cost of bread will increase another 10% due to these subsidies as well according to the article. Governments all over the world are sinking trillions into Ethanol and other alternative fuels for what? Increased hunger, less merriment and more pollution! The latest Stanford study, ignored by the mass media, proves the prevalence of increased pollution from ethanol:

Switching to E85 blends (85% ethanol, 15% gasoline) could result in slightly higher ozone-related mortality, hospitalization, and asthma (9% higher in Los Angeles and 4% higher in the U.S. as a whole), the study finds. Cancer rates would be similar for gasoline and E85.
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The result: more ozone and about 185 more deaths per year across the U.S.

The hyperbolic environmental soothsayers on the left and in the media have swayed our government into investing large sums of money into these technologies that have turned out to be counterproductive. When will we learn to trust the market? Shareholders and private citizens are best left alone to judge the correct production of a good, the heavy hand of the government only serves to distort the market and destroy any progress towards the end goal.

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