This story was written by Editorial Board, The Daily Iowan
Iowa Sen. Tom Harkin and Indiana Sen. Richard Lugar have proposed the construction of a pipeline able to bring Midwestern ethanol to the East Coast, where demand is high. However, given ethanol's current lack of overall cost-efficiency, much of the project's benefits will simply be accrued by the ethanol industry itself. But then again, as long as it's carrying ethanol, Midwestern politicians have always been happy to put the cart before the horse.
With food prices soaring as a result of reduced grain availability, farmers in livestock industries are facing severe financial strain. But obviously, not all farmers across the Midwest are burdened by skyrocketing operating costs. Without a doubt, the ethanol industry has ensured that many farmers are earning greater profits than ever before - a terrific outcome, to be sure. But in light of those industries (and consumers) being worse off as a result of heavy ethanol production, it seems the economic arguments in its favor have somewhat faded. Combining this with ethanol's high costs and rampant inefficiency, it begins to seem that the proposed ethanol pipeline can only hope to serve as a short-term solution and an expensive one at that.
In a comprehensive study often overlooked by ethanol's proponents, scientists at the University of California-Berkeley concluded that corn-based ethanol (the kind championed by Iowa politicians and lobbyists) is grossly inefficient. The study found that it takes 29 percent more fossil energy to produce ethanol than the final product can actually deliver. The study's report made no bones about addressing the true potential of this current trend: "Ethanol production in the United States does not benefit the nation's energy security, its agriculture, the economy, or the environment." Furthermore, because so much ethanol production is funded by government subsidies, the true costs of its production are admittedly much higher than those considered in the study.
Of course, with gasoline prices at all time highs, the high costs of ethanol production are often ignored; its external costs - namely increased food prices - are simply attributed to a troubled economy. Meanwhile, the insatiable biofuel industry is regularly coined as an economic savior. And, while the benefits of ethanol production to local farmers are undeniable, that's not to say they outweigh the cumulative strain felt elsewhere. That is, the gains ethanol creates in the local economy do not likely outweigh the net cost faced by the nation at large. And given the present need for a serious energy solution, it seems that ethanol can only serve as a distraction.
The extent to which many local farmers are helped by the ethanol industry is undeniable, so it is not difficult to see why initiatives such as Harkin's pipeline are popular. The ethanol industry gives Iowa a distinct economic advantage over many other states. But the national energy crisis - as well as inflated food prices - demands that we consider economic solutions for the long term. If ethanol is indeed to be our focus, efforts to make it a viable alternative must be doubled. To that end, it is imperative that Iowa invests in energy solutions that will remain viable far into the future - when fossil fuels can no longer be depended on. And, given our seeming inability to dictate when that time will come, it seems that sort of foresight should begin sooner rather than later.