Agriculture Secretary: Ethanol as cause of food crisis ‘flat-out wrong’
Agriculture Secretary Ed Schafer on May 9 said U.N. and other international aid officials are “flat-out wrong” to call U.S. ethanol production from corn a major factor in world food shortages and riots.
Mr. Schafer, a longtime proponent of biofuels, vehemently disputed efforts by the leaders of the World Bank and the U.N. World Food Program to blame ethanol for rising world food prices. He said his department calculates that competition between food and biofuels accounts only for up to 3 percent of food price increases.
“Only a very small portion of this problem is ethanol driven,” Mr. Schafer said in an interview with The Washington Times. Global food prices have risen 45 percent since mid-2007.
Mr. Schafer also said the administration will have an “uphill climb” to sustain President Bush’s promised veto of the farm bill compromise that Republicans and Democrats on Capitol Hill reached earlier this month.
“Many Republican legislators in both houses [. . . ] have indicated they’re going to vote to override the president,” he said, noting the lure of “money in their district.”
Mr. Schafer has become the administration’s point man for opposing the farm bill, arguing it does not sufficiently cut subsidies to high-income farmers.
“They’ve made it look good; they’ve said, ‘Oh, we put some limits on folks here,’ but the reality is they haven’t,” he said.
Mr. Schafer, a former governor of North Dakota who was sworn in as agriculture secretary in January, in the middle of the farm bill discussions, said farm income is projected to reach a record $92 billion this year, which is 50 percent higher than the average over the past 10 years.
He said continuing subsidies and adding new ones make no sense when farm incomes rise.
Mr. Schafer has led the defense of the U.S. biofuels program, which has come under fire most notably from former top Bush administration officials.
World Bank President Robert B. Zoellick and U.N. World Food Program head Josette Sheeran, both of whom served as top officials at the State Department and U.S. Trade Representative’s Office, have said the switch to ethanol, which is made from grains, is raising the demand for staples such as wheat, rice and corn to record levels.
“I’m concerned about the fusing of food and fuel markets,” which pits moneyed energy interests against the world’s poor, Ms. Sheeran told the Peterson Institute for International Economics two weeks ago. “Energy bidders can outbid food buyers and, in a year of tight supplies, that’s having a bigger impact than it would ordinarily.”
And Jeffrey Sachs, a top adviser to U.N. Secretary-General Ban Kimoon, said two weeks ago that the U.S. biofuels program, the world’s largest, represents a “huge blow to the world food supply.”
President Bush has ordered the Agriculture Department to release $200 million in emergency food aid to low-income countries struggling with higher food costs. The administration has also asked for $350 million in new food aid funding in the supplemental war-spending bill, and lawmakers may tack on even more.
But Mr. Schafer said that rising energy prices, drought in key producing regions, and rising demand from developing countries such as China and India have played a far more significant role than ethanol, adding that those strains on the world’s food networks can’t be solved overnight.
“Under our current models, we’re showing that we will see these levels of [food] prices for the next three years,” he said.