Wednesday, August 27, 2008

What if what was good for South Dakota wasn't good for America

Today I spoke with a former South Dakotan who advised me that I am wasting my time researching the long term benefits of ethanol.  He said all a politician needs to know is that farmers want ethanol and a politician is there to support their voters.

Because of our farmers in South Dakota and other corn belt states, our Federal Government has in 2005, through mandate, created an industry with a guaranteed demand.  But it doesn't stop there.  It is the law of our country that 35 billion gallons per year of ethanol will be sold in 15 years.  Our government just created an $200 billion industry.

I don't know if ethanol is positive or negative for our country, but I know the next four years is going to be filled with alternative energy trade associations asking for government assistance. 

Here is just a small list of alternative energy choices to relieve ourselves from foreign oil requiring mandates, subsidies, tax credits or research grants...

1. Wind Turbines (transmission lines)
2. Solar (photovoltaics)
3. Hydrogen (burning or fuel cells)
4. Natural Gas (power plants and engines)
5. Lithium Battery Power (engines)
6. Hybrid Autos (engines)
7. Flex Fuel Vehicles with ethanol (engines)
8. 100% ethanol vehicles
9. Cellulosic Ethanol


The Federal Government is going to be in a rush to eliminate our dependence on foreign oil.  It scares me to think about how much money we are going to spend on one or all of these alternatives.  I want people to think about what will happen if the Federal Government picks the wrong one to support.  

For example, the Federal Government has bet on ethanol.  How can we use corn to produce ethanol efficiently over the long term.  Even the supporters of ethanol unknowingly recognize that cellulosic ethanol is the future because it is easier to grow and has more potential to produce more energy cheaply.  But the technology does not exist as of today and may never prove to be possible.  

According to Einstein, time travel is possible, but I don't think we should mandate 35 billion gallons of time travel by 2020.  

We need to be very reasonable in our approach to spending taxpayers money.  Choosing one technology over another treads on Communism and a state controlled economy.  It is important for our Government to support private investment of entrepreneurs and private business without choosing one over the other.

I truly hope that ethanol is one of the answers to alleviate our dependence on foreign oil, but mandates should scare every farmer in South Dakota, because as fast as the ethanol industry was created, it can be taken away if it isn't an economically viable alternative.  

If, for instance, the Chevrolet Volt turns out to be a major success, and the electric car becomes the form of transportation of the future, liquid petroleum will not be necessary.  As more cars use batteries, the problem with smog from automobiles will be a thing of the past, thus ending the reliance on ethanol for cleaner emissions.   Coal and natural gas will be required for additional electricity generation and additional usage for ethanol would be problematic.

Whatever we do in the transition from gasoline to alternative fuel is going to require federal guidance. This guidance should be governed by fairness and prudence, not politics.  The solution to energy independence will require setting aside state interests for the good of the country.  

I hope ethanol is the answer to foreign oil problems, but if it isn't, I hope our state will support the technology that is most prudent, regardless of our own self interests.  I pray our elected representatives will be knowledgeable and do the same.

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