Hearing on corn-based ethanol problems

A few weeks ago I met with some bakers from Maine who told me that the prices of wheat flour and eggs had skyrocketed, and that some grains such as rye were becoming unavailable at any price. I started looking into the causes and found that many experts believe that federal ethanol policies are a significant cause along with droughts, high energy and fertilizer costs, and increased global demand. The more I examined the issue, the more I became convinced that federal policies to spur corn-based ethanol are having unintended consequences for food supplies and prices. I asked Senator Joe Lieberman to hold a hearing to examine the link between high food prices and federal subsidies, import restrictions, and mandates for ethanol.

Our hearing, which was held on May 7, featured testimony from Maine small businessman Andrew Seigel, who owns the When Pigs Fly bakery in York County. Andrew described paying $7500 for flour in September, a cost that skyrocketed to $22,000 in February. Needless to say, this enormous increase in the ingredient that he uses the most has constrained his growth and, if it continues, could jeopardize the future of this wonderful Maine small business.

I have never been a fan of the subsidies for corn-based ethanol because of the cost to taxpayers and the environmental implications. Now it appears that these subsidies are also distorting the market, causing high food prices and scarcity, and exacerbating hunger among the poorest people in our country and around the world.