How do you reduce gas prices?
According to Brian Jennings, you use ethanol.
Of course, Jennings is the Executive Vice President of the American Coalition for Ethanol, so what else would you expect?
That being said, the question itself is inherently flawed.
Reduce gas prices? Drivers in the United States enjoy some of the cheapest gas prices in the developed world. At least, that’s the illusion. However, you and I both know that the price we pay at the pump does not directly reflect the cost of production, distribution, and consumption.
Truth is if you really dive into what we’re shelling out in tax dollars through a myriad of nonsensical tax breaks and military costs (including human lives on the battlefield), we pay an extraordinary amount to fill up. And don’t expect those prices to plummet, either.
Even with a wealth of new domestic oil flowing from beneath our feet, we will continue to pay a great price for the convenience of a well-established oil-centric world.
This isn’t a criticism, by the way, but merely an observation of truth.
So instead of asking the question, “How do you reduce gas prices?”, perhaps a better question is: “How do you responsibly reduce gasoline reliance?”
The Oil Market is a Global One
Make no mistake; our reliance on gasoline and diesel will continue well throughout the rest of the century. Even with the flood of ethanol being released into the market, the rapid development of electric cars, and the steady increase in public transportation and rail transport, our cars and trucks will continue to be primarily fueled by gasoline and diesel.
And this holds true for the rest of the world, too — especially in China and India.
Sure, the United States is swimming in a bounty of unconventional oil these days. But the oil market is a global one. And despite the common misconception by way too many folks in this nation, we are not the only country on earth.
Bottom line: If you believe that gasoline is going to get cheaper, you’re in for an unpleasant surprise.
War Has Been Declared!
Now, the folks over at the American Coalition for Ethanol will tell you that it is the highly-inefficient corn-based ethanol that can save us from high gas prices.
Nothing could be further from the truth.
In fact, while ethanol advocates rant and rave about the economic benefits of ethanol, they rarely discuss how much of your hard-earned cash is being pilfered by way of exorbitant subsides for the Big Ag machine, which irresponsibly grows an abundance of corn with dangerous pesticides and GMO concoctions that are also heavily subsidized by you, dear taxpayer.
Cheap ethanol? Not a chance. There’s nothing cheap about a fuel that requires government welfare and the decimation of our natural resources.
And certainly the mere idea of dumping food into our fuel tanks while people are going hungry in this country and around the globe is not only unethical — it’s downright criminal.
But that doesn’t matter to the peddlers of corn ethanol.
In fact, at a recent Fuel Ethanol Workshop, CEO of biofuel pusher BBI International Mike Bryan told a crowd of enthusiastic supporters that the ethanol industry was at war, primarily with the oil industry.
I don’t know about you, but if there’s a “war” going on here, it’s between a welfare-supported ethanol industry and lots of pissed-off taxpayers.
In any event, ethanol isn’t going to make the cost of fueling your vehicle any cheaper. In fact, it could be argued that it actually makes it more expensive.
So back to the real question: How do you responsibly reduce gasoline reliance?
Ethanol, the Enabler
It’s actually not that difficult.
In fact, we’re already starting to make some headway — albeit somewhat minor at this point — in actively making progress on reducing gasoline and diesel consumption today:
Increases in fuel economy standards
Increased production and demand of fuel-efficient vehicles
Rapid development of electric and plug-in electric vehicles
Increased ridership and expansion of mass transit
The integration of natural gas-powered trucks and buses
My friends, those are real solutions — not ethanol. In fact, ethanol actually stretches our gasoline supplies, which may seem like a good thing on the surface, but only serves to prolong our continued reliance on heavily-subsidized fuels.
That’s not a solution. That’s an enabling problem.
At the end of the day, if you truly want lower fuel prices, you have to advocate for lower gasoline reliance. It’s pretty simple.
And don’t kid yourself — this whole ethanol scam is going to collapse one day.
When it does, as an investor, I’ll be both vindicated and a bit wealthier as my investments in both electric vehicles and natural gas pay off in spades… and especially my natural gas infrastructure plays, which have been getting an enormous boost lately.
To a new way of life and a new generation of wealth…
Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.
Want to hear more from Jeff? Sign up to receive emails directly from him ranging from market commentaries to opportunities that he has his eye on.