"In a joint statement, the companies said the study supports the idea that "a large-scale pipeline project is feasible under certain conditions and that a federal loan guarantee is necessary to move forward."Meanwhile, the 45-cent-per-gallon tax credit that subsidizes ethanol production is due to expire at the end of the year, and the industry is split over what should be done."
http://www.desmoinesregister.com/article/20100720/BUSINESS01/7200359/1001/NEWS/Ethanol-boost-called-vital-to-biofuel-carrying-pipeline
What affect on railroads?
......Isn't there a problem with corrosion in large pipes transmitting Ethanol....??
Quentin
Victrola1 "In a joint statement, the companies said the study supports the idea that "a large-scale pipeline project is feasible under certain conditions and that a federal loan guarantee is necessary to move forward."Meanwhile, the 45-cent-per-gallon tax credit that subsidizes ethanol production is due to expire at the end of the year, and the industry is split over what should be done." http://www.desmoinesregister.com/article/20100720/BUSINESS01/7200359/1001/NEWS/Ethanol-boost-called-vital-to-biofuel-carrying-pipeline What affect on railroads?
Well, under "Certain Conditions" anything is feasible. This subsidized pipeline will divert lucrative taffic from the railroads. That will be its effect.
This is absolutely disgusting. The two Pols, Harkin and Boswell, are going to try to force investment into an uneconomic project that will hurt the US economy and result in a net loss in economic growth and diminished job opportunities. If you're a railroad worker please realize that these two Pols are trying to get into your paycheck.
Note well that the so called "Financial Incentives" are but subsidies for the pipeline that will divert investment from projects that will really pay. This will hurt the US economy. Harkin and Boswell do not care about that. They only care about their own power. The company promoting the uneconomic project, Poet, is reliant on government direction of money. On its own, it would rapidly fold. So they seek further government aid, as if they were permanent welfare recipients with absolutely no ability to care for themselves. They are corporate leaches who suck our money similar to the way real leaches suck peoples' blood.
And another thing!
One of the problems blocking a real economic recovery is the reluctance of people to invest. They won't buy houses for example. Now think about this. Some folks invested in buying the tank cars to move that ethanol. (Not the railroads, they railroads haven't supplied tank cars for at least 100 years. A third party does that.) Now those investors are going to see their investment destroyed by a subsidized pipeline. Do you actually think they'll ever make such an investment again?
One conspiracy theory has surfaced. I did not come up with this myself, but it makes sense and deserves consideration. Ethanol is hopelessly uneconomic. It's still cheaper to buy oil and turn it into gasolene than to use ethanol. But if the government is going to force ethanol use, it would be cheaper for the people on the east coast to buy imported ethanol from Brazil. Brazil can produce ethanol cheaper than Iowa and get it to the east coast at a cheaper cost than the folks in Iowa can. That's blocked by an import tariff that basically serves to transfer wealth from the poeple who earn it on the east coast to the people of Iowa.
Harkin and Boswell are Pols that represent Iowa and they want the pipeline to make sure the wealth transfer continues. (They know what they're doing. They're shameless.) Once the government puts up a $4 Billion "Guarantee" on the pipe, they're going to make sure ethanol flows through the pipe. Otherwise it will be a pipeline to nowhere. And if that means people get hurt, so be it. Harkin and Boswell will still have power.
Greyhounds: I agree with your overall point. And from the "Green" perspective, ethanol is a loser as well, requiring more energy in total to grow harvest and refine than the output.
greyhoundsBrazil can produce ethanol cheaper than Iowa and get it to the east coast at a cheaper cost than the folks in Iowa can. That's blocked by an import tariff that basically serves to transfer wealth from the poeple who earn it on the east coast to the people of Iowa.
But if wealth transfers occur, many Americans would prefer the transfer occur within the US rather than transfer wealth to another country, be it Brazil, Saudi Arabia or China.
C&NW, CA&E, MILW, CGW and IC fan
And another tree falls in the Amazon.....
Kewl...
schlimmGreyhounds: I agree with your overall point. And from the "Green" perspective, ethanol is a loser as well, requiring more energy in total to grow harvest and refine than the output. greyhoundsBrazil can produce ethanol cheaper than Iowa and get it to the east coast at a cheaper cost than the folks in Iowa can. That's blocked by an import tariff that basically serves to transfer wealth from the poeple who earn it on the east coast to the people of Iowa. But if wealth transfers occur, many Americans would prefer the transfer occur within the US rather than transfer wealth to another country, be it Brazil, Saudi Arabia or China.
-Don (Random stuff, mostly about trains - what else? http://blerfblog.blogspot.com/)
We need the EPA to test E10 and unleaded gasoline side by side on every new car. Let the public see the fallacy of ethanol reducing our dependence on foreign oil.
oltmanndNah. If we buy ethanol from Brazil, they'll have money to buy our corn and beef, or locomotives, or peanuts, or cotton, or wheat, etc. Free trade always means more stuff for both sides - it maximizes the production efficiency of both parties - everybody does more of what they do best.
Or more of what they do cheapest. And cheapest, as we have seen, is a moving target, China being the latest to begin losing out as its workers get smart and demand more rights and more money.
The ultimate refutation of the free-trade ideology is that 30 years after free trade began really picking up steam our trade deficit continued to worsen monthly right up until the Great Recession slowed our spending on imports. That worsening deficit will resume if we ever see a recovery.
This represents a deplorable transfer of profits and wealth from the United States.
As to ethanol, it is surely the dog that all you good correspondents say, and if we're not careful we're going to get it shoved down our throats.
It is ok to cut off subsidies to producers, but perfectly proper to approve the same for a pipeline company? Or better yet, send the jobs and business overseas?
Sure, the ethanol subsidy will go away, but guess what folks, payments under farm programs will skyrocket as a result. (they went to the lowest levels in decades because of ethanol)
Outstanding logic.
"Washington, D.C. — The sultry days of July in the nation's capital haven't been kind to Iowa's biofuels industry.The ethanol industry is fracturing and under attack inside and outside the Capitol. The industry's 45-cent-a-gallon subsidy is due to end at the end of the year, but energy bills that could provide a means of extending the tax credit have been delayed, throwing the legislation's future in doubt."
http://www.desmoinesregister.com/article/20100724/BUSINESS01/7240332/1001/NEWS/Ethanol-subsidy-renewal-in-doubt
If the subsidy goes away altogether, no pipe line, but how many idle tank cars? If the subsidy is not extended, what affect?
Will major railroads feel it that much? Will some short lines in the Midwest be devastated?
Victrola1 If the subsidy goes away altogether, no pipe line, but how many idle tank cars? If the subsidy is not extended, what affect? Will major railroads feel it that much? Will some short lines in the Midwest be devastated?
As I read the last paragraph there was speculation that if the $6 billion per year subsidy goes away, as I believe it should, production will not be much affected since congress requires a substantial volume of ethanol to be used anyway. That consumption would not fall very much seems a reasonable conclusion.
We will still be paying a higher than economically necessary price for liquid fuel, but it will be in the price of fuel as opposed to as a subsidy. Poor public policy, but at least not as bad as laundering the money through the great income redistribution machine in Washington DC.
Mac
Right now, the industry uses well over 10,000 tank cars, and 19,500 covered hoppers. These are very conservative numbers since I really have no idea how many privates aside from the TILX, UTLX, GATX, CITX, ADMX, MWCX, ACFX, DBUX, and FURX fleet are out there. Trinity alone has produced since 2001, it's 635200 to 648900 series 6300 cubic foot covered hoppers for this service.
I expect the industry will continue, but need to tighten it's belt further. In addition, it will have no choice but to increase prices. Personally, I don't want to see the tens of thousands of direct jobs, and who knows how many ancillary jobs go away.
City folks who are mostly the big naysayers of Ethanol, have no idea what this has done for rural America in the way of investments. Where I work, it includes five plants, with a total direct investment of $468 million, 99% of which was private funding or farmers shares. A bare minimum of 230 jobs for those five plants. Indirect investments, such as the costs for railroads is about $8 or $9 million locally now. Add to it, trucking companies for CO² and wet DDG, local track maintenance companies, a transload terminal, mechanical contractors, and inspection firms.
End terminals as well have spent hundreds of millions to handle this traffic. The big players, UP, CP, CN, CSX, NS, and BN have heavily competed, and are still competing for this business.
Grain elevator managers are also reliant upon these plants, as it has removed a lot of risk from their shoulders. No longer do they have to worry about export prices and transport (or how much they will loose on an ADM contract this year), most of their business is now local.
The whole equation, has saved taxpayers billions per year, and indeed added much to the local coffers from income and property taxes. Or would you prefer to the days of using MBTE in your gas, and forever wonder about your ground water?
ndbprrThe industry may be split but most of us taxpayers are not. Shut the whole debacle of ethanol down and stop spendning our money!
And pay twice as much to grain producers in the form of price subsidies as was happening before the ethanol boom began in 2001. That is exactly what will happen when you remove 30% of their market (the most stable portion).
Why all of a sudden are people upset with a subsidy that has been around since the days of the Carter Administration?
Wow do you have a vivid imagination. Take a look for example at a new rail car. The truck frams are imported from Brazil. This explains Brazil's growing trade surplus in recent years, with the U.S. being the largest consumer. Those jobs casting truck frames used to all be in the U.S.
Trends in U.S. exports to Brazil since 2005:Meats down 20%; Animal Feeds down 15%; Wheat up (due to draught in Brazil 2008); Railway transportation equipment down. This left a net deficit in 2006 of $7.2 billion.
This has been an ongoing trend since the 1970's, where your neighbors are so willing to trade you and your job down the river to make a few more bucks. Ask the folks at ASF.
schlimm Greyhounds: I agree with your overall point. And from the "Green" perspective, ethanol is a loser as well, requiring more energy in total to grow harvest and refine than the output.
What inputs did Pimentel use for that report? When was it written? How many people have copied it without bothering to really examine it? How has agriculture changed since that time?
Overwhelming evidence says, his report, and others based upon his findings are flawed to the extent, that they have no relevancy. It is kind of laughable to be honest, basing the overall energy content of corn with practices that change from state to state, and even county to county. For example, no one here uses irrigation in corn., yet that was an input he used for the industry. Many producers here use manure instead of fertilizer, another input that skews his final theory. Natural gas for drying, farm to market transport, tillage practices, I can go on. And they all flaw the resulting reports.
But the biggest flaw, is his ignoring the impact of yields. Nationwide in 2009, yields reached the 165.2 bushels per acre level. That is 10% over the 2008 figure. In Iowa, which accounts for 20% of corn produced, it was up 13.4% in 2009 despite lower planted acres. And from what I see today, we could surpass those numbers. I know several producers who will look at 214 bushels per acre this fall if all goes well.
Then there is process used to produce ethanol. Pimentel used a wet mill as a model. That's fine, except a majority of ethanol produce here are at plants that use the dry mill method. And even those plant process have been refined over the last 8 years to bring further yield per bushel (new enzymes, process water control, and even a new microwave drier).
Finally, there are reports that take into account more recent farming practices and realities, that show ethanol has a positive net energy gain. Far more comprehensive than Pimetel and his gang.
RRKen ndbprrThe industry may be split but most of us taxpayers are not. Shut the whole debacle of ethanol down and stop spendning our money! And pay twice as much to grain producers in the form of price subsidies as was happening before the ethanol boom began in 2001. That is exactly what will happen when you remove 30% of their market (the most stable portion). Why all of a sudden are people upset with a subsidy that has been around since the days of the Carter Administration?
What do you mean "all of a sudden"? I've been upset with the subsidy since the Cater Administration.
Really, there's no good reason to subsidize any economic activity/industry. Including farming. Subsidies are just a politically motivated redistribution of wealth. They have an overall negative effect on the national well being. Sure, folks in Iowa have benefited from the ethanol subsidy. How could they not benefit? The government is literally taking money away from people in New Jersey and giving it to people in Iowa. Yes, there are more jobs in Iowa. But there are also fewer jobs in New Jersey. The job losses in New Jersey will exceed the gains in Iowa.
As to free trade, it's not and "Ideology" or a "Belief". It's been studied and analyzed by economists for centuries. The people of both the importing nation and the exporting nation experience a net welfare gain by being able to freely exchange goods and services with each other. If you can show otherwise please go right ahead. You'd probably get the Nobel Prize in Economics if you could because you'd prove just about everyone with a PhD in economics has been wrong.
I don't think you, or anyone else, can do that..
I wonder if these economists ever leave their office, get their noses out of reports and take a look outside. Pretty sad when we are turning into a service economy. But, hey, free trade. I'm sure someone somewhere benefits.
We get it, you don't like subsidies and "big government". That's your belief, and that's fine. But not everyone subscribes to that.
PS. Your signature is kind of amusing, though. Railroads never met a subsidy they didn't love. Would they be as effecting and efficient without them...? One can only wonder.
PPS. I'm not an economist (obvious, no?), just that I get tired of seeing decent jobs being shipped to countries using slave labor.
It's been fun. But it isn't much fun anymore. Signing off for now.
The opinions expressed here represent my own and not those of my employer, any other railroad, company, or person.t fun any
greyhounds[As to free trade, it's not and "Ideology" or a "Belief". It's been studied and analyzed by economists for centuries. The people of both the importing nation and the exporting nation experience a net welfare gain by being able to freely exchange goods and services with each other.
Oh sure! Rich corporations get richer by sending manufacturing to China, and outsourcing services to India and Bangladesh. Meanwhile everything here in the United States gets shut down.
Oh I'm just busting with net welfare gain from all this "free trade".
Know any other good jokes?
Murray Know any other good jokes?
Eleanor Roosevelt walks into a bar with a goat under her arm....
zugmann I wonder if these economists ever leave their office, get their noses out of reports and take a look outside. Pretty sad when we are turning into a service economy. But, hey, free trade. I'm sure someone somewhere benefits. We get it, you don't like subsidies and "big government". That's your belief, and that's fine. But not everyone subscribes to that. PS. Your signature is kind of amusing, though. Railroads never met a subsidy they didn't love. Would they be as effecting and efficient without them...? One can only wonder. PPS. I'm not an economist (obvious, no?), just that I get tired of seeing decent jobs being shipped to countries using slave labor.
It's not about what I "like" or "dislike". It's about what's real. What's been proven to be true. Some people don't like reality. Some people try to change reality with laws and tariffs. That doesn't work.
As to railroad subsidies, the Union Pacific did turn down money from California which would have been used to improve clearances over Donner Pass. Good for them.
Freight railroad subsidies pretty much serve to make freight movement less efficient and less effective. They mask the real cost to the economy and encourage waste. Thankfully, in the US they are not significant. But the railroads do have their hands out, just like everyone else. Heck Fire, if the government decided to give me some money, I'd take it. 'Course they'd have to take it away from someone else to give it to me. It wouldn't make any sense and it would make someone else less well off. It would be basically legalized theft on my part. But nobody is going to turn down money obtained through "legal" means.
I've seen RRs near me saved with "big government money". Railroads that later in life were bale to find new business and become profitable. Luckily they were saved and able to capture that business.
Yes, it is your belief. I don't think outsourcing every job away from this country benefits us a whole. That is my belief. I also believe that subsidies are not always legal theft. Just because something has reports and numbers "proving" it does not make it a fact. You can make statistics show whatever you want. 95% of people know that.
We will never convince each other - so we'll have to agree to disagree. My point is, that there is more than one belief in how government should operate. Neither one is more "right" than the other.
greyhounds As to free trade, it's not and "Ideology" or a "Belief". It's been studied and analyzed by economists for centuries. The people of both the importing nation and the exporting nation experience a net welfare gain by being able to freely exchange goods and services with each other. If you can show otherwise please go right ahead. You'd probably get the Nobel Prize in Economics if you could because you'd prove just about everyone with a PhD in economics has been wrong. I don't think you, or anyone else, can do that..
I think the burden is on you to show and tell, given 30-some years of growing trade deficits and the hollowing out of our manufacturing sector, to the devastation of vast swatches of the Midwest and Northeast, and the resulting drain of wealth to overseas, including to China, which uses the profits from selling us stuff we used to make for ourselves to buy missiles pointed at us.
The economists who think this is a good deal remind me of the "scientists" lined up behind the belief that carbon dioxide -- 1/10th of 1 percent of our atmospheric gases, of which less than 5 percent is accounted for by Man -- is responsible for "global warming" (which itself has been MIA for nearly 20 years).
dakotafredFree trade always means more stuff for both sides - it maximizes the production efficiency of both parties - everybody does more of what they do best
Fair Trade.....Probably yes....but the "Free Trade" we have now is far from a level playing field. And we seem to be on the "short end" too much of the time...
Modelcar dakotafredFree trade always means more stuff for both sides - it maximizes the production efficiency of both parties - everybody does more of what they do best Fair Trade.....Probably yes....but the "Free Trade" we have now is far from a level playing field. And we seem to be on the "short end" too much of the time...
Hey, Model, please be more careful. I didn't say that; somebody else did. I'm on the other side of the "free trade" fraud.
Free trade is a double-edged sword. In a vacuum, it is perfect, but it is not in a vacuum.
If all the countries of the world had been competing on a free trade basis since the beginning, we would have a balance of trade today with all goods and services being produced by the most efficient producer and sold on the market at the lowest possible price.
But for many reasons, this kind of optimally balanced free trade has not been developing worldwide since the beginning. Why is it that the U.S. has become a manufacturing giant over the last 150 years while China has only recently begun that trek? There are differences in the distribution of natural resources that might give one country an advantage over another, but I don’ think that explains the difference in economic development between China and the U.S. The more obvious explanation is that we have liberty and free-market capitalism, whereas they are repressed by the shackles of communism. Whatever the explanation, the result is that we have a much higher standard of living and higher wages than China does.
Now all of a sudden, with the era of telecommunications and computer data transfer, the communist government of China decides to embrace capitalism as if it were a home business of a dictator. They can instantly buy the machine tools and train up a workforce that can be sustained by their prevailing depressed wages that correspond to their relatively undeveloped status and lower standard of living. Our workforce cannot possibly compete with the Chinese workforce until their wages gradually rise to parity with ours and their standard of living rises accordingly.
At the same time, our wages and standard of living will decline in spite of the optimum product pricing of the world free trade model. And because that depressed wage competition includes more than just China, our wages and living standard are likely to fall further than theirs will rise, as the imbalance seeks equilibrium.
So while it is true that world free trade is a perfect economic model that produces the best result for everybody, if it suddenly encounters an unleveled playing field, it can cause damage to the side disadvantaged by that unleveled playing field. With a wage disparity as large as that which exists between the U.S. and most of the third world, the world free trade model could destroy the U.S. while efficiently providing us with goods and services at the lowest possible price.
dakotafred Hey, Model, please be more careful. I didn't say that; somebody else did. I'm on the other side of the "free trade" fraud.
......My bad........Sorry.
Bucyrus...Our workforce cannot possibly compete with the Chinese workforce until their wages gradually rise to parity with ours and their standard of living rises accordingly...So while it is true that world free trade is a perfect economic model that produces the best result for everybody, if it suddenly encounters an unleveled playing field, it can cause damage to the side disadvantaged by that unleveled playing field. With a wage disparity as large as that which exists between the U.S. and most of the third world, the world free trade model could destroy the U.S. while efficiently providing us with goods and services at the lowest possible price.
What troubles me the most is that we in this country are supposed to have the best and the brightest business minds in charge of our capitalist system. Thats the reason for such institutions at Harvard Business School etc is it not?
From the way the US has been trending in the last 30 or so years, I am beginning to wonder if we in fact have the best and brightest capitalists at all.
As a nation, our economic decisions don't seem to indicate that.
Bucyrus Free trade is a double-edged sword. In a vacuum, it is perfect, but it is not in a vacuum. If all the countries of the world had been competing on a free trade basis since the beginning, we would have a balance of trade today with all goods and services being produced by the most efficient producer and sold on the market at the lowest possible price. But for many reasons this kind of optimally balanced free trade has not been developing worldwide since the beginning. Why is that the U.S. has become a manufacturing giant over the last 150 years while China has only recently begun that trek? There are differences in the distribution of natural resources that might give one country an advantage over another, but I don’ think that explains the difference if economic development between China and the U.S. The more obvious explanation is that we have liberty and free-market capitalism, whereas they are repressed by the shackles of communism. Whatever the explanation, the result is that we have a much higher standard of living and higher wages than China does. Now all of a sudden, with the era of telecommunications and computer data transfer, the communist government of China decides to embrace capitalism as if it were a home business of a dictator. They can instantly buy the machine tools and train up a workforce that can be sustained by their prevailing depressed wages that correspond to their relatively undeveloped status and lower standard of living. Our workforce cannot possibly compete with the Chinese workforce until their wages gradually rise to parity with ours and their standard of living rises accordingly. At the same time, our wages and standard of living will decline in spite of the optimum product pricing of the world free trade model. And because that depressed wage competition includes more than just China, our wages and living standard is likely to fall further than theirs will rise as the wage imbalance seeks equilibrium. So while it is true that world free trade is a perfect economic model that produces the best result for everybody, if it suddenly encounters an unleveled playing field, it can cause damage to the side disadvantaged by that unleveled playing field. With a wage disparity as large as that which exists between the U.S. and most of the third world, the world free trade model could destroy the U.S. while all the while providing us with goods and services at the lowest possible price.
No, and nothing is "Perfect". The US manufacturing sector has hit a big bump with the recession. Along with everything else. But before that (and hopefully after that) it was doing just fine. We were not loosing our manufacturing base. Actually, before the recession the US manufacturing sector was growing faster than the overall economy.
Manufacturing employment is a different story. And it's not a different story of jobs being sent overseas. It's a story of productivity. "What took 1,000 workers to produce in 1950 takes less than 200 to produce now." (Actually, China has lost a greater percentage of its manufacturing jobs than the US has.)
US manufacturing is just going through the same thing US agriculture went through. Productivity improvements allow greater output with fewer workers. That's gonna' happen or we will loose our manufacturing. Can't stop progress.
Guys, we just gotta' stick with the facts and reality.
From the Federal Reserve prior to the recession:
http://www.edcchicago.org/presentations/Manufacturing%20EDC%20080625.pdf
My question of the day. Sure, you end up with less workers. But then who is left to actually spend money...? We make lots of things, but yet no one to sell the things to (in this country).
I can never get an answer to that.
And what counts as "manufacturing"? It's one thing to produce plastic bottle lids, and another to produce tanks, airplanes and railcars. But hey, at least we have a rise in service jobs.
Our community is FREE to join. To participate you must either login or register for an account.