The other day I heard that the federal government is buying up a whole bunch of meat from farmers who are having a rough summer because of drought. I wasn’t quite sure what to make of it until this morning when I read this editorial in The Washington Examiner. They want to inflate the price of meat to protect ethanol, which is driving up the cost of gas.
None of this makes sense. In fact, Obama’s move only harms American consumers while protecting a corrupt federal program.
A drought is currently driving down corn production. The shortage of feed is forcing livestock producers to slaughter animals early, putting downward pressure on meat prices in the short run and guaranteeing shortages and higher prices next year. But nature is not the biggest factor in this crisis — the government is. Specifically, the federal government’s ethanol mandate, which requires that 13.2 billion gallons of corn-based ethanol be produced in 2012.
Thanks to the ethanol mandate, more than 40 percent of the nation’s corn crop now goes into the production of a useless fuel that hardly anyone would buy if the government didn’t require it. That’s up from just 17 percent in 2005, before the mandate went into effect. Only 36 percent of the corn crop now goes for feed, and 24 percent goes for food.
Obama could solve this problem instantly by suspending the federal ethanol mandate — something his EPA actually can do unilaterally and legally. Instead, Obama will buy up meat — a move that meat producers say won’t help them much anyway. “It doesn’t solve the problem of having enough affordable corn next summer,” industry analyst Steve Meyer told Reuters. “Without changing the ethanol program, nothing can be done,” he said.
Update: Linked by I’m 41 – thanks!