“Inflation is walloping Americans with low and moderate incomes as the prices of staples have soared far faster than those of luxuries,” reports the Washington Post today. A big part of the problem is “the increasing use of land to produce ethanol,” which “has led demand for food to outstrip supply.” For this and other reasons, the New York Times advocates getting rid of ethanol subsidies. Ethanol subsidies threaten to cause an enormous amount of environmental damage, deforestation, and soil erosion.












My local bagel supplier has been commenting on the increasing price of flour. This was also front page news recently.
The cost of flour has increased so rapidly that most small bakers are having very real difficulties. For the most part, according to one of my customers, they are absorbing the cost themselves, hoping to ride out this storm without losing to many regular customers. A little bit of profit is better than no profit mentality. However, this can’t go on forever and with all the food costs escalating it must be expected that more people will cut more “extras” from their daily lives. This customer is a regular listener of NPR and even they realize (begrudgingly) that the greenies ideas about ethanol and biofuels are an economic disaster in the making.