Why Does Milk Cost More Than Gas?

By Nicholas von Hoffman, The Nation. Posted July 20, 2007.

The other day milk was selling in a New England supermarket at $4.79 a gallon. Down the street, regular gasoline was going for about $3.04 a gallon.

One of the factors driving up the cost of milk is the ethanol stampede. Ethanol, as we all have been taught to believe by now, will bring us "energy independence" and lessen global warming with no change in the way we live -- unless we happen to be a small child in a household with a limited budget.

Children from low-income families are either going to have to accustom themselves to drinking gasoline or learn to sing "No Milk Today."

American ethanol is made from corn, and the more corn we use to feed our cars, the more expensive is the corn left over for our livestock. Ergo, "No Milk Today."

If ethanol we must have, we could import it from Brazil, where they can make it cheaper from sugar cane than Americans can make it from corn. But Brazilian ethanol, thanks to the agribusiness lobby and a 54-cent-per-gallon import tariff, is kept out of the country.

Politicians of both parties, mad for winning elections in corn-growing Iowa, do not mention the cheaper Brazilian stuff. Their silence on lesser-cost alternative ethanol sources may help them please Midwestern agribusiness interests and just about nobody else.

But nobody else seems to know that, although it is not for lack of available information. The ethanol fraud has been exposed on mainstream TV on programs like ABC's 20/20.

If ethanol is a failure as a practical short-term gasoline substitute, it is a political success. It will be years before ethanol has even a minor beneficial effect, which matters not to American politicians intent on slow-poking on climate warming, pollution and our ever-constricting energy sources. Kid the voters into thinking something is being done when it is not.

The energy bill gradually making its way through Congress contains a section upping the fuel-economy standards on gasoline-powered vehicles to take full effect when? In the year 2020. As of now cars in Europe and Japan get many more miles to the gallon than cars in America.

The last time the government imposed fuel-efficiency standards on cars was thirty-two years ago. In the intervening generation, car makers have learned to make more energy-efficient engines, but their technical progress has been defeated by making ever-larger automobiles. The Wall Street Journal reports that "models that started out as subcompacts have grown to become more like midsize models. Honda Motor Co.'s Civic CRX, a mid-1980s two-seater of 20 years ago, was 12 feet long and weighed about 1,700 pounds. Today's Civic sedan is nearly three feet longer and weighs about 900 pounds more. Even the smaller Honda Fit, considered almost impossibly small today, is larger than the mid-1980s Civic CRX."

The world is many years away from inventing and deploying oil substitutes. The present American policy of doing nothing until that day comes is short-sighted, idiotic and, ultimately, costly. Instead of making windy speeches about our "oil addiction," our politicians should be at work making sure we use less of the stuff now.

Two measures of immediate effect could be put in place now. The first is to reduce speed limits on roads built with federal dollars. The second is a tax on the horsepower and weight of new cars. This should be an annual tax, not a one-time levy so that only the very rich will find that they can afford to drive overweight gas guzzlers.

Why should the rich get to guzzle gas when the rest of us cannot? Because, as someone once said, the rich are different. But we can also place a ruinous tax on their private airplanes. That ought to make the rest of us feel better even as, at long last, we take effective measures to deal with climate and energy.

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Nicholas Von Hoffman is a columnist for the New York Observer and is the author, most recently, of "Hoax" (Nation Books, 2004).

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