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Jason Bradford on January 24, 2007 - 12:46pm Permalink | Subthread | Parent | Comments top

And there are the social ramifications of the increase in corn prices. Energy Bulletin had a great summary recently on the effects in Mexico:

http://www.energybulletin.net/24986.html

Couple of snippets:

"High corn prices are wreaking havoc on Mexico's inflation rate and forcing shoppers to pay more for eggs, milk and tortillas. But they're a godsend to farmers such as Victor Manuel Amador Luna."

"Facing public outrage over the soaring price of tortillas, President Felipe Calderón abandoned his free-trade principles on Thursday and forced producers to sign an agreement fixing prices for corn products."

A simple law of ecology is that it is impossible to do only one thing. What are the feedback loops between the inability to politically tell people that curtailment of demand is necessary, the short-sighted investments in an ethanol production system with no future, rising commodity prices and food insecurity in Mexico, political and economic stability in our neighboring country, further immigration pressures, the US' inability to maintain, let alone expand its own decaying public infrastructure, the high expectations of a generally clueless and delusional populace, and the continued failure of institutions to meet those expectations?

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Keithster100 on January 24, 2007 - 2:32pm Permalink | Subthread | Parent | Comments top

And true to form, Mexico screwed it up. The corn producers will just send all their corn to the US and make loads of money and abandon the local tortilla market. Now instead of having expensive tortillas, they will have none at all. This situation can be blamed on one entity: the Mexican government. Of course, people will blame everyone else--the US, George Bush, Drivers, capitalism etc.

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PeakOil Tarzan on January 24, 2007 - 3:38pm Permalink | Subthread | Parent | Comments top

I expect the corn will go where it fetches the most money. If American drivers are willing to pay more than the average Mexican peasant is willing (or able) to pay, then it will come Norte. No bureaucratic bungling necessary.

Of course, there are things that we can do to mitigate the consequences:

  • American taxpayers could subsidize Mexican corn growers like they are subsidizing American corn growers.
  • We could put up a big fence to keep hungry Mexicans from...(oh, yeah, we're already doing that).
  • We could nuke those pesky Mexicans.
  • We could teach the Mexicans to root for truffles.

    • Have I forgotten anything???

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    Keithster100 on January 24, 2007 - 5:16pm Permalink | Subthread | Parent | Comments top

    Yes, the obvious thing: the Mexicans can grow more corn and be a part of the bonanza. This will lower the price of corn and then Juan and Maria can afford their tortillas again. Bonus points if Juan and Maria invest in corn or ethanol-related companies.

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    beggar on January 24, 2007 - 6:41pm Permalink | Subthread | Parent | Comments top

    Actually, the Pseudo-Free Market comes to mind as a culprit here.

    Is the market not designed to make the rich even more rich, and the poor even poorer?

    Surely the market is contrived and it is contrived often to benefit some people at the expense of others.

    Economist John Gray's work comes to mind as a good balance to the "Free Market" agit prop we are spoon fed so often.

    Just a thought.

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