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Ethanol Slavery

Rolf A. F. Witzsche
June 3, 2006
Source EIR News Service
 and LaRouche Political Action Committee - May/June, 2006

In a hungry world, the 'rich' insanity of imperial rulers is driving society to convert its food products into an expensive and useless fuel that takes more energy to produce than it gives back - an efficient way indeed, to wreck the world food supply - and it is happening!

The poor are dying under this yoke while the real energy resources of America and the world remain unused and in some cases unknown. The American statesman and economist, Lyndon LaRouche, is committed to reversing this insanity. About LaRouche. 

Below is an example of the work to expose the insanity.



Ethanol has trapped them in an infernal existence. The cost of Brazil's
sugar production is the lowest in the world, because of the "cheap and
plentiful labour" of which financial vultures always brag. In the
state of Sao Paulo, the cost of production is $165 a ton,
compared to $700 per ton in European Union nations. According to
a February 2006 study published by Brazil's Social Justice and
Human Rights Network, workers in Sao Paulo state are paid 2.60
reais--about a dollar--per ton of cut cane. Workers are paid
according to how much cane they can cut in a day, and are
constantly pressured to cut more. Those who can't cut enough, or
who file grievances, are fired, and are often blacklisted.

Workers who do the backbreaking work to cut ten, or even 12
tons per day, can earn up to R$800 a month, but then have to
deduct R$400 for food and usually miserable accommodations.
Malnutrition and illiteracy plague most cane-cutting areas.

Workers migrate from one region to another in search of work,
leaving their families behind, as there is more than one harvest
season. Where mechanization has been introduced, fewer workers
are needed, as occurred during the 2001/2002 harvest in
Pernambuco state where 150,000 cutters lost their jobs. But since
they have no alternative employment, workers are left to wander
to other areas in search of work, or end up residing in urban
slums or {favelas}. 

[sources: Renewable Fuels Association; Salt Lake Tribune; 5/21
Lexington Herald-Leader; 5/19 Businessweek]


The ethanol industry is a purely artificially-spawned fascist
instrument, surviving through multiple layers of subsidy and 
tax rip-offs, and government decree.

To start with, the Energy Policy Act of 2005 demanded that
U.S. refiners purchase--thus, that ethanol producers produce--4
billion gallons of ethanol in 2006, and 7.5 billion gallons of
ethanol by 2012. (Regular petroleum refiners add ethanol as an
additive to gasoline, so that the final mixture is usually 90%
gasoline and 10% ethanol.) Thus, there is created a near doubling
of ethanol output during 6 years, strictly by diktat.

EIR has pulled together some of the subsidies that the
ethanol industry receives, reported by the Renewable Fuels
Association (RFA), the industry lobbying group. Many of these
were created by the Energy Policy Act of 2005, although some have
existed for several years:

* According to several sources, ethanol receives a "54 cents
per gallon subsidy at the pump." We are investigating whether
this is given as a straight-out cash payment or as a tax credit.

* According to an RFA fact sheet, the "volumetric excise tax
credit for Agri-Biodiesel" fuel is "$1.00 per gallon." (We are
inquiring how this is paid.)

* Further, according to the RFA fact sheet, "ethanol
producers [are] allowed a 10-cents per gallon production income
tax credit on up to [the first] 15 million gallons of
[alternative fuel] production."

* Newly published Internal Revenue Service rules, which
arose from the 2005 Act, allow for a 30% federal income tax
credit, up to $30,000 per property, for the installion of fuel
pumps that dispense alternative fuels. Apparently, this would
apply to fuel filling stations.

In addition, state and local governments also subsidize the
building and operation of ethanol production plants, with
incentives and tax breaks. All told, the ethanol industry
receives billions, and perhaps tens of billions of dollars of
subsidies. Imagine the difference were those funds applied to
LaRouche's retooling legislation. 

[source: May 21 Toledo Blade]


Investors, from Wall Street professionals to regular farmers, are
plowing their money into the new swindle-boom: building ethanol
plants. The May 21 {Toledo Blade} reports that "ethanol-producing
plants [are] springing up throughout the country."

The plants are heavily subsidized by multiple levels of
government (see above slug). These funds establish a floor under
their plant operations and according to Thomas Byrne, head of
Byrne & Co., Ltd., of Minnesota, who has helped develop more than
30 ethanol plants, if the price at which these plants can sell
their ethanol product at the terminal market hits between $1.30
to $1.35 per gallon, these plants will make a modest profit. Last
year, ethanol terminal prices were down to $1 to $1.20 per
gallon, and these plants lost money.

But the hedge-fund driven hyperinflationary commodities boom
has changed all that: ethanol prices at the terminal have shot up
to between $2.70 and $2.90 per gallon, and the Blade reports,
"some plants now are swimming in profits." Ethanol plant investor
Thomas Byrne commented, "If you have a 50 million-gallon
[ethanol] plant and ethanol hits $2.30, you've made $50 million.
Your returns are very, very good."

The combination of the government subsidies and the
hyperinflationary commodities boom have kicked off a boom in
plant construction. 97 ethanol plants are in operation in the
United States (25 in Iowa), and another 35 plants are under
construction. The Toledo Blade proclaimed, "Plans for 150 other
plants have been announced the past year," that is, a more than
doubling of the number, in this lunatic swindle. 

[sources: 5/19 Salt Lake Tribune; 5/21 Sunday Observer]


While ethanol supporters are incapable of arguing that ethanol is 
economically efficient, they still claim that it is "environmentally
friendly." In a May 19 article in the {Salt Lake [Utah] Tribune},
"Corn Ethanol Isn't All It's Cracked Up to Be," author Pete
Letheby rips to pieces this myth. Letheby writes that experts
told the population that "Ethanol from corn lessened our
dependence on foreign oil.... It was much better for the
environment. Who could not support this?" However, he says, the
truth presents a contrary picture:

* "Producing one gallon of corn ethanol needs 1,700 gallons
of water to irrigate the corn and process the fuel, according to
Cornell researcher David Pimentel... Because of that depletion,
the Ogallala Aquifier in the Plains is under considerable stress.

* "Growing corn for ethanol increases soil erosion and
reduces biodiversity, according to Washington State University

* "The {Des Moines Register}... last fall found that Iowa's
ethanol plants have contaminated the state's air and water. A
corn ethanol plant in Hastings, Neb. was cited for clean-air
violations every year from 1995 to 2004."

Parallel to the U.S, Brazil has become a leading ethanol
promoter; the same fraud is rampant there. In an article, "Brazil
Leads Field In Alternate Fuel Race," the May 21 {Sunday Observer}
reports that 85% of new car sales in Brazil are flex-fuel
engines, which are capable of running on either gasoline or

As a result of the ethanol boom, the Sao Paulo state
government is considering turning over still more land to grow
sugar cane for ethanol. "Some are calling for a tenfold increase
of land provision," reports the {Observer}. "But that would have
a catastrophic environmental impact. There are fears that as more
farmers grow sugar cane, oranges, and soya, and cattle farmers
move to forest areas, there would be an untenable depletion of
precious rainforests." 

In a hungry world, the 'rich' insanity of the imperial rulers is driving society to convert its food products into an expensive useless fuel that takes more energy to produce than it gives back - a super-efficient way to wreck the world food supply, and it is happening.

June 14 (EIRNS)-- Excecutive Intelligence News Service

background and updates.

U.S. SENATE HEARING JUNE 19. The full Committee of Energy &
Natural Resources will take "testimony regarding implementation
of the Renewable Fuel Standard in the 2005 Energy Bill and the
future of biofuels such as biodiesel, cellulosic ethanol, and

BIOFUELS IN TRANSPORTATION are what have made the booming
bio-fuels sector a "safe investment," for world capital--read
"cartels" -- as Cargill's recent press releases have pointed out,
in their announcements of start-ups of huge new bio-fuels
projects in USA, Germany, France, Malaysia, and elsewhere. The
U.S. has now surpassed Brazil in volume of ethanol output;
Germany leads the world in biodiesel use.

* FRANCE. September, 2005, French government issued
bio-fuels goals. Quota allocations were given out to selected
operations, to implement the goal of having 5.75% of biofuels in
fuel by 2008; 7% by 2010 and 10% in 2015.

* USA. 2005, U.S. issued goals. Must have 4 billion gallons
of biofuels used this year; and 7.5 bil gallons annually by 2012.
(Dems last week made lemming announcement that '25% of U.S.
transportation fuel should be biofuel by 2025'--slogan is, "25 by

* CANADA. Aim is for 45% of gasoline consumption to contain
10% ethanol by 2010. Ontario is to be the center of this, where
government expects to reach goal that all gas will have a 5%
blend of ethanol by 2007.

* CHINA. E10 blends are mandatory in five provinces that
account for 16% of the country's passenger cars.

* INDIA. A sugar ethanol program calls for E5 throughout
most of the nation. Soon this may go up to E10 or even E20. E10
blends are mandatory in five provinces that account for 16% of
the country's passenger cars.

* THAILAND. Goal of 10% ethanol mix in gasoline by 2007.
U.S. STATES ALSO SET MANDATES. On May 30, 2006, in Iowa,
already the leading ethanol state, Gov. Tom Vilsack (D) signed
legislative package creating a tax credit for selling E85 that
starts at 25 cents a gallon and phases out by 2021; and another
tax credit of 3 cents per gallon for diesel blends containing at
least 2 percent biodiesel. Plus, law contains more inducements.
One kink is that many states' budget crises don't allow them
to fulfill promises for ethanol hand-outs. Minnesota is currently
in debate on whether to abrogate grants, since farmer co-ops,
like cartel-owned ethanol plants, are making multi-millions in
profits right now.

CARGILL ON A BIOFUELS BINGE. Just a few of its projects
announced in the past 6 months:

England: Cargill/Greenergy Biofuels (largest biofuels firm
in U.K.) will build new biodiesel facility at Cargill's existing
oil-seed crushing plant in Liverpool, on the Mersey River--using
international feedstock input. Cargill's February 2006 press
release: ``With biodiesel plants on the east coast Humber estuary
and West Coast Mersey estuary, Greenergy will have a presence in
two of the most important oil refining regions in the U.K. Having
world class biodiesel production facilities on both coasts gives
unmatched access not only to the raw materials for production but
also to the fuel supply chain.''

France: Cargill started a new biodiesel facility, next to
its rapeseed crushing plant at the port of Montoir in western
France. Joint venture with Sofiproteol, a financial holding
company specializing in oilseed use and marketing. The 350,000
tons of by-product meal to be produced at Montoir will go into
Cargill's animal feed marketing. The Montoir site is just part of
Cargill's existing nationwide operations in France, which include
a site at St. Nazaire, where the volume of Cargill's crush of
sunflower seed represents more than half of all France's annual
production. A Cargill plant already in Brest will focus on
rapeseed and soy crushing for biodiesel and livestock feed.
Germany: Cargill broke ground in March near Frankfurt, for
its new biodiesel plant in the Hoeschst Industrial Park, intended
to process rapeseed oil and other vegetable oil feedstocks, to
reach 250,000 metric tons of capacity and utilize ship, rail, or
road tanker transportation.

Malaysia: Here, Cargill Palm Products Sdn Bhd will supply
crude palm oil, as the primary feedstock in a new five-year
contract, for a just-announced biodiesel plant. The facility,
designed for a 100,000-ton annual capacity, will be designed and
built by Mission Biofuels Ltd, listed on the Australian stock
exchange. The biodiesel output is already booked for a five-year
supply contract, for shipment to Austria-based commodity trader
Godiver Handelsgesellschaft GmbH, which then will market it to

now 100 ethanol plants in operation, and 40+ under construction,
plus biodiesel under construction.

handle rising volume of biofuels, is underway in certain regions.
For example, in Louisville, Kentucky, Marathon Oil is building
big storage facility expressly for biodiesel, to then distribute
to retailers.

CHICAGO CHOKEPOINT. Up to one-third to one-half of the
nation's total 4 billion gallons of ethanol flow this year is
going through Chicago's congested rail network, to east coast

Burlington Northern Rail is straining to handle the volume
of both corn and soy shipments, and also the "normal" coal flow.
BN has ordered a raft of new locomotives--giving round-the-clock
work to GE locomotive factory near Erie, Pennsylvania, but all
associated with the downgrading of the U.S. energy and
agriculture base! There is such a shortage of tank cars (30,000
gallons each) that car makers have a backlog of a year and a half
for orders, says spokesman for American Railcar Industries, Inc.
distorted from the last three decades shift out of secure food
and fiber policies, into "free markets." 


About LaRouche - the American economist and statesman that has become a legend in our time in the fight to advance civilization, protect mankind, and create a new renaissance: 

" We are at a point in world history. 
At the present time, the international monetary financial system
of the world is in the process of disintegration. That does not mean the end of the world. It means that we either make certain changes, or this
planet will go in fact into a prolonged new dark age, comparable
to what happened to Europe during the middle to late part of the
14th century." (LaRouche, June 15, 2006)

About the series:  Truth versus Guns,
 presented by Rolf A. F. Witzsche

About Rolf A. F. Witzsche

Rolf A. F. Witzsche, is an independent researcher, publisher, and author of eleven novels. The novels are focused on exploring the Principle of Universal Love, the principle that is reflected to some degree in every bright period throughout history, with the added challenge for today to give our universal love an active expression with a type of 'Universal Kiss' for all mankind. 

Novels by Rolf Witzsche

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