The subject of biofuels and the ludicrous set of government subsidies and trade quotas that are creating artificial markets in related products has been the subject of past Newsletters [Note: The best article I have seen on this subject is still Thomas Friedman’s September 2006 article: http://select.nytimes.com/2006/09/20/opinion/20friedman.html]. The article in the url link below, however, provides an informed (and depressing) summary and update:
“Energy security and climate change are two of the most significant challenges confronting humanity. What we see, in response, is the familiar capture of policymaking by well-organised special interests. A superb example is the flood of subsidies for biofuels. These are farm programmes masquerading as answers to energy insecurity and climate change. Not surprisingly, they have the depressing characteristics of such programmes: high protection, open-ended support to producers, and indifference to economic rationality.”
The article is full of facts, figures, and unintended consequences that effectively dismantle the current approach of a number of political administrations that are committed to specific remedies as a result of the lobbying of entrenched interests. The goal at present, clearly, is not to find efficient solutions to the huge problem climate change presents; rather, it is to appear interested by pursuing those policies that play well with domestic audiences:
“This then is a classic farm programme: a costly system of transfers looking for a rationale. Or, as the report puts it: "The bewildering array of incentives that have been created for biofuels in response to multiple (and sometimes contradictory) policy objectives bear all the hallmarks of a popular bandwagon aided and abetted by sectional vested interests."”
Take care
Dave
Bill Werther & David Chandler
Strategic Corporate Social Responsibility
© Sage Publications, 2006
http://www.sagepub.com/Werther
Biofuels: an everyday story of special interests and subsidies.
By MARTIN WOLF
1081 words
31 October 2007
Financial Times
Asia Ed1
Page 11
http://www.ft.com/cms/s/0/40a71f96-8702-11dc-a3ff-0000779fd2ac.html
The author’s blog on this article (with useful and insightful comments) can be found at:
http://blogs.ft.com/wolfforum/2007/10/biofuels-a-tale.html
