World Bank Study: Biofuels Guilty as Sin

By David L. Brown

Well, this should put a final nail in the coffin of schemes such as making ethanol from corn and fake diesel fuel from soybeans. According to an article appearing today on The Guardian newspaper’s website, a confidential World Bank report concludes that biofuels are responsible for 75 percent of the increases in food prices that have taken place in recent years and months.

Here are the lede grafs from this absolutely damning report from The Guardian (a respected United Kingdom newspaper):

Biofuels have forced global food prices up by 75% – far more than previously estimated – according to a confidential World Bank report obtained by the Guardian.

The damning unpublished assessment is based on the most detailed analysis of the crisis so far, carried out by an internationally-respected economist at [the] global financial body.

The figure emphatically contradicts the US government’s claims that plant-derived fuels contribute less than 3% to food-price rises. It will add to pressure on governments in Washington and across Europe, which have turned to plant-derived fuels to reduce emissions of greenhouse gases and reduce their dependence on imported oil.

Senior development sources believe the report, completed in April, has not been published to avoid embarrassing President George Bush.

“It would put the World Bank in a political hot-spot with the White House,” said one yesterday.

We have been ringing a warning bell about this problem for a long time, and the Frankenstein Monster just kept staggering around creating havoc. Only in recent months have soaring food costs and increases in ag production costs become a problem serious enough to raise concern. Now with this latest revelation, all pretense that biofuels based on food crops have any place in the world must be shattered. This is the smoking gun that almost certainly will be the beginning of the end for this blind alley approach to breaking the oil addiction.

The article continues:

“Without the increase in biofuels, global wheat and maize stocks would not have declined appreciably and price increases due to other factors would have been moderate,” says the report. The basket of food prices examined in the study rose by 140% between 2002 and this February. The report estimates that higher energy and fertiliser prices accounted for an increase of only 15%, while biofuels have been responsible for a 75% jump over that period.

It argues that production of biofuels has distorted food markets in three main ways. First, it has diverted grain away from food for fuel, with over a third of US corn now used to produce ethanol and about half of vegetable oils in the EU going towards the production of biodiesel. Second, farmers have been encouraged to set land aside for biofuel production. Third, it has sparked financial speculation in grains, driving prices up higher.

As we have also pointed out, food shortages have led to hoarding on national levels as countries that would otherwise export rice, wheat or other foodstuffs have begun to hold them in reserve instead. This factor leaves many poor nations that depend on imported grain hanging over an abyss of potential famine.

Here in the US, the Lords of Ethanol have been waging a public relations delaying action to attempt to defend their heinous actions, as we have reported and commented upon here a number of times. But the World Bank report should put an end to what a leading UN spokesperson has called a “crime against humanity.”

I will repeat the mantra I proposed some months ago to reflect my feelings on this subject:

The mythic teacher Jesus is said to have turned water into wine, but only a living Satan would turn wine into water or food into fuel.

Many nations have unwisely and against all logic and common sense bet their energy futures on biofuels, not least the United States which recently enacted a new energy bill that calls for rapid and significant increases in the use of the fake fuels. Legislation in many countries in Europe also call for more reliance on ethanol and biodiesel, and it seems pretty plain that a lot of back pedaling is going to have to take place on this subject. The sooner the better, and the opportunity will come when the leaders of the G8 industrial countries meet next week in Japan to discuss the food crisis. They were already braced to be met by intense pressure to call for a moratorium on the use of plant-based fuels. Now those who protest will have some real ammunition with which to back up their argument.

“It is clear that some biofuels have huge impacts on food prices,” The Guardian article quotes Dr David King, the former chief scientific adviser to Britain. “All we are doing by supporting these is subsidising higher food prices, while doing nothing to tackle climate change.”

Exactly. Here in America this is a money grab that has its evil roots in the tainted soil of Washington, aimed at enriching farmers and distillers in return for votes and cash. As I have written before, the U.S. government would be extremely well advised to immediately halt all subsidies to ethanol producers, through which taxpayers have enriched farmers and distillers for making this witches’ brew.

A second step, one requiring more cojones than I expect anyone in Washington actually has, would be to put a full stop to ethanol and biofuel production — and I don’t mean just placing a moratorium on further development, but actually shutting down the plants where the Satanic act is being committed. In effect, to outlaw the use of food-based biofuels. The owners of the plants would then be well and fully motivated to find other non-food sources for their processes, such as the switchgrass that President Bush so famously touted a couple of years ago in a State of the Union address. Even that may not make any sense, as we have noted here, but at least it would not be the crime of diverting food that could feed starving millions.

If strong actions such as these are not taken, and soon, the international public relations backlash that is building momentum will grow into a tsunami as famine begins to set its teeth into the bellies of the poorest people of the world. Only through quick and decisive action can this monstrous crime be stopped before more damage is done.

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