Who's responsible for high gas prices?
By Warner M. Montgomery
Warner@TheColumbiaStar.com

We routinely blame the Arabs when the price of gasoline goes up, and we praise the government when it goes down. This blame and praise may be misdirected.

Venture capitalist Vinod Khosla, founder of Sun Microsystems, comments on the current fuel dilemma in an article in the October issue of Wired magazine. He has studied the use of corn (kernel and stalk) to make fuel (ethanol), and he is putting his money on what he has found:

+ Making energy from corn is more efficient than making energy from fossil fuel (gasoline).

+ Ethanol is not expensive to make, one dollar per gallon.

+ 40-60 million acres of corn can satisfy our gasoline needs.

+ Switching to ethanol is not expensive. A new car can be made flex-fuel-capable (to burn ethanol) for about $35. To adapt a retail gas pump to ethanol costs $10,000.

+ Cars using ethanol get less mileage than those using gasoline but technology is quickly narrowing the difference.

+ Ethanol from grasses will soon be cheaper than from corn.

+ Ethanol is subsidized 51¢/gallon federal tax credit that costs taxpayers $2 billion a year. But most of that credit goes to the oil companies not the farmer.

So, what is the problem? Why are we still blaming OPEC for $3 gasoline? Why are we still dependent on fossil fuels and held captive by sheiks in the Middle East?

The answer lies in a system that keeps cash flowing between Congress and Big Oil.

+ Congress subsidizes the oil companies over $82 billion a year.

+ The oil companies use our tax money to lobby (campaign contributions) Congress against development of new fuels, increased mileage requirements, greater pollution controls. An example of their success is a 54¢ tariff on imported ethanol that hampers competition.

+ Big Oil and Congress spread misinformation that ethanol is inefficient and expensive to produce, cars running on ethanol get poor mileage, and America does not have enough land to grow enough corn.

Khosla and others like Willie Nelson are in a war with Big Oil and Congress. If they win, we all win. If they lose...well, we'll still survive...but at the mercy of folks like Chavez and Ahmadinejad.