Opinion: Doug Thompson, Daddy Warbucks

The biofuel miracle diet
By Doug Thompson
Millions more acres of corn, as if we didn’t have enough already.
U.S. cornfields covered more than 120,000 square miles in 2006. This year’s acreage will cover 15 percent more  to satisfy demand for ethanol. This clearly shows the market at work, the U.S. Secretary of Agriculture told a Fayetteville audience last week.
Wow, I thought: That’s quite a market impact for a drop in the bucket.
U.S. production of ethanol set a record of 121 million barrels last year. We consume 20 million barrels of crude oil a day. We consume about 9.2 million barrels of gasoline a day for motor fuel, according to the latest figures I can find.
Let’s make a whopping assumption and figure that all 18,000 square miles of new acreage translates directly into more ethanol.
We would add enough ethanol to keep our cars running for two days.
Now consider that considerable amounts of fuel burn up in producing ethanol — tractor fuel, tanker truck fuel, fuel used in refining. Ethanol might produce more energy than it burns up, but it’s no wonder weapon.
All that corn probably translates into less than 24 hours consumption on America’s roads.
Corn-based ethanol is a nice panacea to use while we’re burning almost a million barrels of oil an hour, but it has about as much potential to solve our problem as the next miracle diet pill has of making me gracefully thin.
I’m not dismissing alternative fuels. There are options. For instance, there are plants that produce many more times the amount of fuel per acre than corn. U.S. corn just has a bigger lobby.
If one of these longshot alternatives is going to develop, though, we need to stop playing around.
Here’s a thought. We want to develop alternative fuel sources, right? Why don’t we do the same thing we did when we wanted to develop a textile industry in New England in the early 19th Century? That worked so well, we did the same thing for the iron and steel industry later in the same century, and many others.
Let’s tax the fool out of the imported competition.
Now, just by mentioning the word “tax,” I’ve branded myself a liberal Democrat.
By that definition, every American robber baron of the 19th Century was a flaming tax-and-spend liberal. John Jacob Astor to J.P. Morgan, liberals all; Who knew?
There’s a word for a tax on imports. They’re called “tariffs.” For much of this country’s history, they provided the bulk of the federal government’s revenue.
If we tax oil imports, it could give countries an excuse to raise other tariffs. America taxes oil. Foreign countries could then tax American corn. Energy independence is important to America. Well, food independence is important to other countries. That sort of thing.
Domestically, passing a tariff on imported oil makes it more difficult to argue against tariffs to protect American jobs. This is particularly true since every increase in oil costs hurts the blatantly uncompetitive U.S. auto industry.
All this makes the diplomacy and politics of taxing imported oil more difficult. It does not make it either impossible or undesirable.
We can’t prop up the auto industry forever, despite boardroom influence upon the Republicans or union influence upon the Democrats. Toyota and Honda make better cars. That drives the marketplace. We’ve done the U.S. auto industry few favors with out cheap, dirty energy policy. It has helped make them less competitive every year.
If we’re going to prop up the auto industry indefinitely, use tariff money for that. At least then taxpayers can make the investments in efficiency that Detroit has avoided.
As for the rest of the world, American consumption of oil drives up oil prices for developing countries. You can argue that curbing American imports will make oil cheaper to other countries: Supply and demand.
Another thing: A tariff on foreign oil should not include any tariffs on imported alternative fuels.
The best bio-based options are tropical plants like sugar cane and a grass called Miscanthus, at least according to researchers in Illinois. Even if you argue that temperate American plants like switchgrass or wood byproducts are viable, you can’t argue with the longer growing seasons of the tropics.
The problem with oil energy is not that it’s foreign, per se. The problem is that the foreign countries that have it hate us, and that much of the energy is concentrated in one region. Oil needs competition.
If there’s an opportunity to send some of the money we’re sending now to the Middle East for oil into poor regions of Latin America and sub-Saharan Africa, we should take it.
Daddy Warbucks

XNA shows ‘jump’ in air travelers

While a five percent “bump” in air passengers for March
doesn’t seem like a lot, officials at XNA, are, well
overjoyed. The Highfill airport’s travelers have been
lagging –  yet – lagging. Yet, a new terminal expansion may entice Southwest Airlines or another carrier to XNA and that is good news. While XNA’s success has taken a news media back seat to the “poured concrete news” in
other areas of NWA – Daddy W. says the comings
and goings at the area’s air hub is indeed a barometer
of how well the economy is moving in the region. A five
percent jump from one or less than onepercent growth in
recent months is a very good sign.

BIG PALS..BIG BUCKS..
That’s what former Gov. Mike Huckabee is
hoping for when Jim Walton (Wal-Mart heir and Arvest czar);
Bill Schwyhart (the late J.B. Hunt’s real estate partner) and Leisanne Rockefeller (the widow of former Lt. Gov. Win Rockefeller), host an upcoming meet-and-greet-and-give big bucks affair for
Huckabee. The meeting—only $500 a plate—won’t
raise enough $$ for Huckabee who is buried so far back
in the polls (and in fund raising) on the GOP side of
things. Huckabee, according to campaign finance
reports, has raised less than $600,000 while others
are raking in double digit millions. These folks will really have
to hustle to get the second man from Hope to bump over a
million by the next campaign finance reporting
deadline.

I’LL TAKE THAT ONE…
If you tell Alice Walton “no” – watch out. She’s a
Wal-Mart shopper after all. After being told “no” she
just turns around in the same room and tells the art
dealer – “Well, I’ll just take that one.” After her bid was
rebuffed by Jefferson University in Philadelphia for
the much heralded, but sadly neglected art work “The
Gross Clinic,” Ms. Walton’s bought another work which was in
the same room. The not to be deterred, her soon to be built Crystal Bridges
Museum will now have a Thomas Eakin’s painting. And Jefferson University, which made such a big deal out of not wanting to sell its paintings has $20 million.

CANCEL THAT
Looks like the Arkansas Supreme Court
has sent Wal-Mart and former ousted second man in command
Tom Coughlin back to court. It’s not over the shady
dealings that Coughlin did in “union busting efforts”
but over his lucrative retirement deal. Watch this as
the Benton County Court deal was struck down.

CAN YOU SPARE $58,000?
For the management of the Arkansas Music Pavilion? That what the group is asking for from the City of Fayetteville or anyone else who can pony up. Remember, the AMP “left” Fayetteville, but came back after fundraising efforts in other NWA towns didn’t pan out. If the money comes through for this business, other businesses may want to take note and put out their hand as well.
–
FAREWELL ALLTELL?
Will the wave of private equity
firms buy out Alltell, the Arkansas based
telecommunications giant? Some say yes. Others say
wait and see. Looks to Daddy W. like Alltell is
selling of parts of the company – so buying the whole
shebang may not be out of the question. Daddy W. says
watch the stock prices.

ONE VOTES DOES COUNT
At least that’s what Fayetteville folks are saying after the impact fee issue passed the voter’s smell test by one vote. The mayor flipped and flopped on the issue, which makes Daddy wonder which way the mayor did vote. Daddy W. says Mayor Dan has seldom ever passed up any fee or tax to fill the city’s coffer.

Daddy Warbucks reports on the local business scene. Send comments and tips to daddyw@freeweekly.com.