High food prices may put farmers on a subsidy diet
Congress finds itself under pressure to halt recent incentives to produce ethanol, and to cut farmers' subsidies.
WASHINGTON — With high food prices prompting grocery-store apologies to customers and raising fears of starvation in impoverished countries, Congress suddenly faces renewed pressure to cut subsidies to the wealthiest farmers and incentives for ethanol production.
The American farmer, long an untouchable political icon, has even become something of a political embarrassment on Capitol Hill, with President Bush earlier this week demanding an end to crop subsidies for "multimillionaire farmers."
Congress just last year required that more ethanol be added to the gasoline supply. The mandate is now blamed for inflating the price of corn and other staples.
"It's hard to believe that in five months our country has gone from a strong commitment to pay any price for energy security to the kind of backlash we've seen against ethanol," said Jon Doggett, a lobbyist for the National Corn Growers Assn.
In Congress, some lawmakers are calling for changes in the nation's commitment to ethanol as the biofuel of choice to replace oil. "This is a classic case of the law of unintended consequences. Congress surely did not intend to raise food prices by incentivizing ethanol, but that's precisely what's happened," said Rep. Jeff Flake (R-Ariz.), who introduced legislation this week that would end federal support for ethanol.
Farm-state lawmakers and agriculture lobbyists are stepping up their efforts to protect ethanol, as well as farm subsidies, which have drawn a veto threat from Bush.
At a Capitol Hill news conference on Thursday, Sen. Charles E. Grassley (R-Iowa), a corn and soybean farmer, brandished a big box of Corn Flakes and said a farmer made less than a dime from the box, which cost him $5. "When a farmer gets so little out of a box of Corn Flakes, don't be blaming the farmer, and ethanol, for the high price of food," he said.
In the latest indication that high food prices have changed priorities in Washington, Bush asked Congress on Thursday to approve a sharp increase in spending on international food aid. "In recent weeks, many have expressed concern about the significant increase in global food prices. And I share this concern," the president said.
Soaring grocery bills have joined other pocketbook issues as major election-year concerns. Retail food prices are expected to increase by 4% to 5% this year, after a 4% rise last year, which was the largest annual increase since 1990.
- Increased Use of Ethanol Would Be a Bonanza for Corn Growers Jul 24, 1990
- Lawmakers turn up the heat on ethanol in response to rising food prices May 08, 2008
- End the Subsidy for Ethanol Apr 30, 1998
