In Australia, the master public purse parasite has been Manildra, even coughing money into independent (oxymoron in every sense?) Rob Katter’s election war-chest, but is the writing on the wall, as more State governments look for ways to save money (selling off assets and OKing suspect land developments)?

We follow the USA on many things, so the following article should put a cold chill up the spines of ethanol producers here in OZ.

Jim Sensenbrenner happens to be the top Republican on the House Select Committee on Energy Independence and Global Warming; he also is happier to pay extra to cruise his pontoon boat (across Pine Lake in southern Wisconsin) at 30¢ more per gallon for fuel free of ethanol; what he calls “a lousy fuel” that corrodes his two-stroke outboard engine. His ethanol aversion is a sign that the darling of alternative fuels is hitting a political wall. ‘people are worried about deficits, debt and special-interest handouts and Ethanol is all three’ says Sensenbrenner.

That sentiment is endangering the $27 billion industry that has grown up since federal support began under President Jimmy Carter amid the 1970s energy crisis. Today the U.S. offers a 45¢ per gallon tax credit to refiners that blend ethanol with gasoline. The government also requires gasoline makers to use a steadily increasing amount of the additive and it imposes an import tariff to deter foreign competition. The tax credit – worth more than $4.7 billion last year – expires on Dec. 31, 2010 as does the protective tariff. If Republicans control the House after the Nov. 2 elections, the renewal of those measures will be in doubt. Ethanol could go the way of biodiesel, an alternative fuel made from soybeans, whose production has ground to a near-halt since biodiesel’s $1-a-gallon incentive expired at the end of last year, according to the National Biodiesel Board.

As in Australia, ethanol makers pushed for and got a 10% add ratio and persuaded the Environmental Protection Agency to allow 15% in motor fuel blends. Growth Energy – an ethanol advocacy group supported by the top U.S. producer, Poet of Sioux Falls, S.D. – says without investment in next-generation ethanol, such as cellulosic ethanol derived from wood and nonedible parts of plants, use will dry up, rural jobs will go away, and corn prices will plunge as biofuel production stagnates, says Wesley Clark, the former NATO commander and Presidential candidate who is Growth Energy’s chairman.

The battle over ethanol’s future pits the industry, corn farmers and the U.S. Agriculture Dept. against a growing cadre of environmental groups, cattle ranchers, and deficit hawks like Sensenbrenner. Environmentalists question ethanol’s overall benefits, and cattle ranchers say it raises the price of feed corn. General Motors, Ford, and Chrysler worry that ethanol will corrode engines in cars not designed to handle the stronger blend. Some 12.8 billion gallons of ethanol will be produced this year by 201 distilleries, according to the Renewable Fuels Assn. U.S. drivers will use about 138 billion gallons of gasoline.

Ethanol’s Corn Belt popularity means many Midwest and rural lawmakers of both parties will back it, says David Yepsen, director of the Paul Simon Public Policy Institute at Southern Illinois University Carbondale. However, the USA’s poor financial position is changing the equation on federal spending. Farmers and ethanol supporters, including House Agriculture Committee Chairman Collin Peterson (D-Minn.), accuse the EPA of foot-dragging on the 15 percent blend limit, which they estimate would create about 136,000 rural jobs. A ruling was delayed last November; the EPA says it will decide after the Energy Dept. finishes tests later this year on whether the fuel has a negative effect on newer vehicles.

Clark’s Growth Energy wants the tax credit extended but can accept ending it if the Administration supports ethanol in other ways, such as bolstering the number of fuel pumps, pipelines, and other infrastructure needed to move ethanol from Midwestern distilleries to consumers. Clark seeks to shift political pressure to opponents such as Sensenbrenner, saying they’re blocking a chance for the U.S. to kick its addiction to foreign oil. “If he had to justify that to his constituents,” Clark says, “he might decide that domestic fuel is pretty good.” The bottom line: The $27 billion ethanol industry’s future is threatened as it loses some of the political support that has sustained it for decades.

It would be easier to believe corn farmers and their transport companies if they used 100% ethanol powered vehicles (as they do in Brasil); however, they don’t and as in Australia, ethanol mixes are not allowed in aviation or marine applications.

One-quarter of all the maize and other grain crops grown in the US now ends up as biofuel in cars rather than being used to feed people according to new analysis which suggests that the biofuel revolution launched by former President George Bush in 2007.

The 2009 figures from the US Department of Agriculture shows ethanol production rising to record levels driven by farm subsidies and laws which require vehicles to use increasing amounts of biofuels “The grain grown to produce fuel in the US [in 2009] was enough to feed 330 million people for one year at average world consumption levels,” said Lester Brown, the director of the Earth Policy Institute, a Washington thinktank ithat conducted the analysis.

Last year 107m tonnes of grain, mostly corn, was grown by US farmers to be blended with petrol. This was nearly twice as much as in 2007, when Bush challenged farmers to increase production by 500% by 2017 to save cut oil imports and reduce carbon emissions.

More than 80 new ethanol plants have been built since then, with more expected by 2015, by which time the US will need to produce a further 5bn gallons of ethanol if it is to meet its renewable fuel standard.  According to Brown, the growing demand for US ethanol derived from grains helped to push world grain prices to record highs between late 2006 and 2008.

In 2008, the Guardian revealed a secret World Bank report that concluded that the drive for biofuels by American and European governments had pushed up food prices by 75%, in stark contrast to US claims that prices had risen only 2-3% as a result.  Since then, the number of hungry people in the world has increased to over 1 billion people according to the UN’s World Food programme.

“Continuing to divert more food to fuel, as is now mandated by the US federal government in its renewable fuel standard, will likely only reinforce the disturbing rise in world hunger. By subsidising the production of ethanol to the tune of some $6bn each year, US taxpayers are in effect subsidising rising food bills at home and around the world,” said Brown.

“The worst economic crisis since the great depression has recently brought food prices down from their peak, but they still remain well above their long-term average levels.” The US is by far the world’s leading grain exporter, exporting more than Argentina, Australia, Canada, and Russia combined. In 2008, the UN called for a comprehensive review of biofuel production from food crops.

“There is a direct link between biofuels and food prices. The needs of the hungry must come before the needs of cars,” said Meredith Alexander, biofuels campaigner at ActionAid in London. As well as the effect on food, campaigners also argue that many scientists question whether biofuels made from food crops actually save any greenhouse gas emissions.

But ethanol producers deny that their record production means less food “Continued innovation in ethanol production and agricultural technology means that we don’t have to make a false choice between food and fuel.

We can more than meet the demand for food and livestock feed while reducing our dependence on foreign oil through the production of homegrown renewable ethanol,” said Tom Buis, the chief executive of industry group Growth Energ.

guardian.co.uk © Guardian News and Media Limited 2010

Like the ‘weapons of mass destruction’ the information about the emissions being OK 6% or less are wrong; petrol’s emissions are: 95.86 g(CO2-e)/mj and (corn) ethanol: 99.40 g(CO2-e)/mj.

The government is taking money from tax-payers to subsidise ethanol production and force the use of this under-performing fuel to line the pockets of their financial sponsors to maintain or regain political seats.

It’s not just the more toxic emissions of a 10% ethanol mix, it is the waste of farmland, water and energy (real petrol, electricity and gas) to make this highly processed product.

Ethanol producers have known all along that their eco-friendly fuel is anything but; there is no actual saving on GHG emissions (on a life-cycle basis) and a classic ‘only in America’. The Growth Energy and the Renewable Fuels Association filed suit in Federal District Court alleging that California’s low carbon fuel standard (LCFS) violates the Federal Constitution.

How it started is 2009, the California Air Resources Board adopted a LCFS as it intends to reduce California greenhouse gas (GHG) emissions by reducing the carbon intensity of transportation fuels used in California by an average of 10 percent by the year 2020. The carbon intensity is a measure of the direct and indirect GHG emissions associated with each step of a fuel’s full life cycle … a ‘well-to-wheels’ for fossil fuels and ‘seed-to-wheels’ for bio fuels.

The carbon intensity baseline is measured against gasoline mixed with 10 percent corn ethanol; fuels that have carbon intensity levels below the baseline generate credits and fuels with levels above the baseline create deficits. To comply, a party must show that the total amount of credits equals or exceeds the deficits incurred; if a party incurs a negative credit balance for two or more consecutive years or incurs a credit to deficit ratio of less than 90 percent, the party will be deemed in violation and subject to civil and criminal penalties.

This life-Cycle and Indirect Land Use Changes, where carbon intensity is measured in two parts; the first part represents the direct emissions associated with producing, transporting, and using the fuel and the second part considers indirect effects, including those caused by changes in land use. For corn ethanol, indirect land use changes are a significant source of additional GHG emissions. For instance, gasoline has a carbon intensity of 95.86 megajoules (g CO2 e/mj) measured on a life-cycle basis.

On a direct basis, the LCFS measures corn ethanol at 69.40 megajoules; however, when indirect land use is added, corn ethanol’s carbon intensity jumps another 30 points, so that its life-cycle carbon intensity score is actually higher than gasoline (99.40). In other words, the LCFS finds that corn ethanol produces more GHGs than does gasoline.

Given the LCFS’ requirement of reduced carbon intensity, it’s not difficult to see that corn ethanol will be severely disadvantaged in California and with California as the country’s largest ethanol market, the LCFS will undoubtedly have impacts outside of the state. According to the LCFS, California is the fifteenth largest GHG emitter in the world, representing approximately two percent of worldwide GHG emissions. Transportation fuels are responsible for approximately 38 percent of annual California GHG emissions. A 10 percent reduction in the carbon intensity of transportation fuels is expected to reduce GHG emissions by approximately 15 million metric tons per year.

However, just like Australia – where the coal driven energy section suggests that as Australia is such a small scale polluter – so too does this lawsuit claim; it basically says that any reduction in GHGs in California is essentially immeasurable when compared with total worldwide GHG emissions.

As to the impartiality of Federal Court in the ‘Supremacy Clause of the Constitution’, well George Bush won the presidential election because the Court ruled in his favour, so will the Federal Court invalidate the California state laws that interfere with or are contrary to federal law. In its lawsuit, the trade groups assert that the LCFS stands as an obstacle to Congress’ intent in adopting the EISA (Environmental Security and Independence) Act of 2007 which sspecifically exempted existing corn ethanol producers from claiming or demonstrating GHG reductions, so one can see ‘corporate government’ is everywhere.

In Australia, corporations receive preferential treatment, even ‘for the public’s good’ (fluride in the drinking water) emanates from corporate direction of the government, so it will be interesting to see how it pans out, because you acn bet your bottom $ that ethanol manufacturers in Australia will resist far more than the string manufacturers did when sticky tape came in.

Governments in Australia are slow to admit fault and burn billions of $’s at the behest of their financial supporters, so will they revisit this decision or have the election donations already been spent?

Now for the last 30 years, the banks have been centralizing the power base where all decisions are made by a few (obviously well remunerated as newspaper article keep advising us); however, as greed kicked in an governments allowed the banks to play ducks and drakes with amounts of money that never really existed (see another article I wrote on discoverable and real gold) and the wheels fell off.

Well the whole system depends on growth, that’s it in a nutshell. Increased immigration and extolling the population to fornicate some more for your country is all about demand, the more demand, the more an economy grows; however, what the economists never factor into any equation is the cost; by this I mean real cost to the environment or what the environment can afford.

Point is, we have passed Peak Oil just as we have passed Peak Gold and many other resources, but the most important ones are potable (thats fresh) water and arable land.  I was reading in the newspaper yesterday that the Australian government has mandated that ethanol be sold, despite the fact that it is proven that you start with 100 units of energy made up of fossil fuels (coal, gas and oil) use a lot of fresh water and arable land that could grow food and end up with 50 units of ethanol; those ethanol producers must pay a lot into the election funds of both the major parties.

Now I know Tony Abbott says there is no global warming and you can get a lot of ‘experts’ supporting him (like Barnaby Jones) but the reality is that global warming is a fact as most Aussies living down south will assure you. Has it affected weather patterns; well it if you think summer weather is OK in winter months, then it must be OK, but really, world wide food supplies are way down; now this won’t impact on you and me for a while here in the land of milk and honey Australia, but its starting to bite elsewhere.

Think Americans won’t suffer … they will because they import a lot of what they eat, but who is willing to accept the Greenback as payment ?

Stimulus packages are just another way the corporations are getting the government to pump money into their bottom line.

The USA has started the mountaineer and his dog one last time; maybe the mountaineer will throw off the dog, but as sure as the sky is up, he’s going real soon. The media’s attention has been elsewhere or maybe they are just watching and waiting; whatever, their excuses over the last few years, Frank Rich (The New York Times) has called for Robert Rubin’s head, so we should see the media start to turn. The US economy is just a bubbling pot of crap and hopefully soon they will consider prosecuting those responsible.

Why would anybody think that the housing market – now without the first home owners package – will keep ascending when the average household debt is so large.  In America, adjustable rate mortgages (i.e. mortgages that will never be serviced) is about enter the housing scene, shoving millions more households into default and foreclosure.

Meanwhile, local and regional banks are choking on real estate already in default that they are afraid to foreclose on and have been keeping off the market through 2009 in order to not send the price of houses down further and put even more households under water. So many houses worth much less than the face value of their mortgage; its doubtful the banks holding back out of the goodness of their hearts; the motive (ploy) of holding onto bad loans can’t go on forever and they and we are close to the breaking point.

The next crash will be commercial real estate as oversupply of malls, strip malls, office parks become the biggest liability that any economy in world history has ever seen; who will even want to buy these properties evenly cheaply, because they will never find any retail tenants nor be able to keep up with the maintenance or retrofit them for anything because the banks aren’t really lending.

We read of the bankrupt states in America, led by the biggest of course California (once the 8th largest economy in the world) and New York and right behind them about forty-nine States. Even if they manage to con bailouts from the bailout-weary federal government, the states are will have to reduce public servants etc, which will put more middle-class households into foreclosure.

Look at the States in Australia, all trying to flog off assets to keep an over sized bureaucracy and perception of business as usual sign up; fortunately many projects have been hit on the head as there is insufficient funding available.

Desperate communities will see the ‘strong’ take from the weak while Police numbers shrink and jails are filled to over-flowing; then there is the poor and the sick and the decay of roads and bridges and other infrastructure. (Cuba is now what the USA and Australia will become like, real poverty and few obese people).

How will Farmers fare if the banks – considering global warming and adverse weather patterns – decline access to funding for crop planting … how will the large spectrum of transport survive without passing on fuel increases. What about the price of oil; not so long ago, when oil went up, so did our Aus$, but oil is still going up regardless. At $1.50 a litre, we are already in the danger zone that last time contributed to stifling economic activity everywhere. 2010 will be the year we consciously realize that oil demand exceeds world oil supply; that global oil production cannot hold above 85 million barrels-a-day no matter what we do.

Best you start planting your own veggie gardens ….

However, that’s not the way the script went and as the saying goes ‘be careful what you wish for, you may just get it’; Kevin ‘stand on the peripheral sledging’ Rudd got his wish and is showing how inept he really is.  Sure

he may be rating better than Malcolm Turnball, but he’s still in the honeymoon time frame to great degree, as the general populace ties to come to grips as to what’s really going on in their lives, finance wise.

Good intentions are just not good enough, and while the economy was booming, John Howard – begrudgingly with far sounder economic responsibility – was riding on the backs of his team who believed that our growing economy was all their doing; not so.  One might ponder why my website is titled ‘energy efficient home design’ rather than ‘bash politicians / corporate government’, but when it really come down to it, energy efficiency is what its all about; without energy nothing moves anywhere; forget about the signs on the backs of trucks ‘without trucks Australia stops’ the reality is without fuel Australia stops.

You see energy is everything, from the food you eat to fuel your body to supply physical or mental tasks for an employer (the end consumer) to the commonly accepted tender being money that is but another expression of energy, with which you buy food and lodgings etc. Now for the exercise we will now refer to money and your labour as energy, so for you to get energy from an employer you need to supply energy right ? Right.

Now politicians / corporate government are claiming we in Australia are still the lucky country; whereas we used to ride on the sheep’s back (and agriculture), we now sit on a lot of energy, being coal (where most energy comes from), natural gas and maybe uranium (if any country is silly enough to swallow the clean energy lower emission bull); but the thing they seem to refuse to consider is for us to access these energy sources, we need energy first, and I’m not just talking working capital (which is very thin on the ground courtesy of the greed of the banking industry generally and greedy government, institutional and amateur investors – which pretty much e\encompasses them all given the losses); we need energy to power the machinery that digs the coal, gas and uranium out of the ground; trouble is, corporate government has been selling off out oil for 40 odd years (and now doing it with our natural gas – some of which seems to have ‘escaped’ to nearby East Timor) and we rely on over two thirds of our oil from overseas.

John Howard ignored this problem and so is Kevin Rudd and it begs the question, is Malcolm Turnball likewise blind to this huge hole in accessing these assets ? All are running scared – ably spooked by the energy industry that does not comprehend the ramifications of anything other than winning at all costs, which is exactly what will happen – of carbon trading.  The fossil fuel industries know how much pollution they are emitting, that is why they are fearful of having to pay for polluting, which is what they have avoided for so long. Consider this comparison, in these times of drought, we learned to do with a lot less; 140 litres of water per person in the bush is the ultimate of luxuries, and many complain their turf lacks water. If we know how much energy really costs, we will all become more energy efficient.

In America, the big two auto makers bought out the public transport system and then closed it down to sell more cars; in the years past, local and state governments put in infrastructure for water and banned rain-water tanks under various guises; now they offer rebates for water-tanks and encourage their use. One day – and I hope it is real soon – people will have to pay the real cost of electrical energy, and when they do, we will become more energy efficient; energy companies will still make a profit because they will be able to charge more; even if 20% of the residential areas captured and sold solar energy, the electricity authorities (like Telstra) will still be able to charge a fee for the use of their infrastructure (which originally belonged to the populace as it was built by the governments, but that’s for another argument).

Last night on the news, I saw that the Mitsubishi electric car has already been approved for Australia, but its maximum distance is only 160 kilometres and although it only takes several dollars ‘to fill’, when you consider the up-front cost (EROEI energy return on energy invested) the pay-off time is lengthy; and what about the fact that more people will use my energy and that energy from coal is a major contributor to global warming, but most important is to use electricity from the plug in the wall, you will need a special ‘booster’ to power the car (think of a digital box to use your TV); that energy comes from coal and that coal comes from the ground and is dug up by – you guessed it – oil powered machinery.

Declining domestic oil production and refinery disruptions, geopolitical turmoil and carbon trading issues aside, we are even more vulnerable than before because of our increasing reliance on oil imports, which is compounded by our relative isolation; we now have only seven refineries, owned by the oil majors, that equates to reduced competition and increasing prices. A recent article in The Age suggested that the bureaucracy in Australia thinks we still have a 20 to 30 year window before peak oil (despite a program in the ‘70’s already suggesting we conserve energy), hence the why worry about renewables while there is a flourishing global trade in cheaper oil.

Rudd physically and emotionally must be comprehending that you need energy to do stuff, but one can only do so much before your reserves are also depleted; he is prepared to mandate 20 per cent renewables for electricity generation, but not in transport fuel; he intends pouring $1.3 billion into a green car fund as part of its $6.2 billion package to support the car industry, but you can’t run green cars on standard petrol; even hybrid electric, hydrogen or high-percentage ethanol requires special engines.  Although there is talk of forcing a minimum 10% ethanol, many people don’t want it for some very simple reasons that include the fact that ethanol is subsidized (by our tax-payer dollars), so it is not on a level playing field (leaving aside political donations by ethanol manufacturers), that cars run less efficiently and that ethanol is not a safe fuel (its not to be used in boats or planes; in other words its OK for your car to break down, but Coroners reports on lives lost at sea and planes falling out of the sky because of poor quality fuel would throw light on corporations and government collusion)      .

In what might be a turn-around, Resources & Energy Minister Martin Ferguson (of dubious ACTU fame) intends to release reports in the build-up to a new energy white paper for later this year and unlike the complacent 2004 energy security report which gave scant regard to renewables, these will look at more efficient ways to utilise energy. So 2009 will be a time of reckoning for Australia’s energy security and the May budget will indicate whether cabinet backs Ferguson’s plan for a flow-through share scheme to encourage small resource companies, as well as financial support for oil search in basin frontier areas or continue to kowtow to big oil.

Governments world-wide have for too long listened to the directions of corporations and side-stepped the responsibility of making them pay for their excesses; this ‘marriage’ of government, politicians and bureaucracy (no longer public service) has resulted in inbreeding and a single mindedness driven by greed; the day of reckoning has arrived and Rudd borrowing from our children’s future and not resolving the many challenges of fast diminishing energy and the existing global problems dooms us all. I though Kevin Rudd would make a difference, but after taking the applause of the Kyoto Protocol movement and then turning his back on the future proves he is a shallow man.

What a sureal world his children must grow up in, what fairytale stories of fanciful magic ….

In the Age, Reuss claims that ‘Australia’s favourite car could be fuelled by a combination of grass clippings and household waste in the future’.

Even this is a porky, as Toyota is the leading seller of cars in Australia, so wouldn’t that make them ‘Australia’s favourite car’ ?

Reuss says the company will release a version of its Commodore large car that ran mostly on ethanol by 2010 [that’s just 14 months away] and has started talks with a US company about building a pilot ethanol plant in Australia that turns grass clippings, woodchips and general household waste into ethanol [America is moving away, if but kicking and screaming from ethanol, a very unproductive fuel – And one also wonders how much Holden will ask the Australian People via the Government to pay for a company to sell us ‘magic fuel’].

Reuss says the E85 (an blended fuel that is 85 per cent ethanol and 15 per cent petrol) Commodores will be available with V6 and V8 engines and will produce more power than the current cars because of the fuel’s higher octane rating. [So who is going to pay all the petrol stations to tear up garage storage tanks, put new pumps in and store E85 for a car manufacturer that is on the ropes and wants government subsidies because sales a dropping; Holden’s Commodore will sink in the very near future]

Reuss goes on to say Holden will focus on reducing ts use of foreign oil by either by increasing efficiency or replacing oil altogether with Australian energy alternatives. [What a laugh and text-book response from the likes of none other than the great Peter Pan of the USA, George W].

Earlier this year, Holden’s parent company General Motors signed a signed a strategic partnership with United States biofuel developer Coskata and Reuss says Holden has also had talks with Coskata and they have shown interest in developing a plant in Australia. Coskata’s approach to bio-fuels has created widespread interest because it avoids the controversial process of converting food to fuel.  [What sort of a fool does Reuss take us for, we’ve had enough of American Pie-in-the-Sky bullshit and surely bought our last dodgy corporate philosophy – ALL enthnol fuels compete with us humans for arable food land]

Coskata claims its ethanol has the potential to reduce lifecycle greenhouse gas emissions by up to 84 per cent compared with conventional petrol. [What a crock of crap … everyone knows it takes more energy from coal, gas and oil than ethanol produces, it is one of the least efficinet fuels]

Ruess said ‘Australia needs to rid itself of its addiction to oil’.  NO, what we need to to do is rid Australia of Ruess and any other story-tellers.

Reuss says ethanol is not the only answer to reducing Australia’s fuel consumption and Holden will look at building more efficient diesel and petrol engines, introducing hybrid petrol-electric vehicles and encouraging the use of LPG, in which Australia is self-sufficient’.  Australia has some of the largest reserves of natural gas, all (100%) of our diesel oil comes from overseas, so why not gas powered cars ?

And a closing furphy from the ‘journalist’ of The Age ‘at the moment, Australia’s ethanol comes from waste by-products of cane and wheat, which use more water in the refining process’; my suggestion for energy efficiency, save your money and don’t buy The Age and avoid the heavily subsidized ethanol, otherwise onse you have invested in it, the price of ethanol will go through the roof and you will the latest version of the P76.

Now this may sound like a simplistic statement, however, with an accidental background in the finance industry, my ability to look at this dispassionately is far easier than someone schooled in finance and economics.

To address this statement, I ask you to consider any indoctrination, be it philosophical, religious or cultural or to do with family and or peer group pressures. Although another subject matter, in this era, an example is how terrorism is used by many governments to strengthen its control over the populace.

Greed and Fear have long been the glue used by those in control to manipulate and direct the masses; in years past, wars were fought for spices, for salt, for more land and religion was used as the redeeming necessity or an implied threat (these days called pre-emptive strikes) or freeing a people from the tyranny of a *despotic leader.

*[While Zimbabwe and Iraq are deemed to be ruled thus, the country ‘most deserving’ liberation co-incidentally also happened to be atop a sizable quantity of oil]

Commodities were the basis of trade and exchange; assessing the value of these commodities required some duplicity to effect an exchange, this duplicity has long been used and still is used today as a means of controlling a resource, one major in this instance is human labour.

You are probably familiar with the saying ‘Indian giver’; a terminology used by English cum Americans to describe the ‘duplicity’ of the indigenous Native North Americans. [These worldly travellers thought they had landed in India, hence the name Indians]  Rather than tell the truth where they exchanged beads and blankets to use land they occupied that was ‘owned’ by the indigenous Native Americans, they drew up documentation that today would be considered ‘harsh and unconscionable terms and unlawful’; instead these people put the focus on the fact that the indigenous people wanted their land back (which most likely was over exploited) and were reneging on the deal.

Of course since then, America has stolen more ideas, technologies and more importantly people’s rights to choose for them selves.

These brave new inhabitants of North America were convicts and the *lower class upper gentry who left England (who jumped before they were pushed); they wanted to make the best of a bad situation and stealing the land was preferable to paying for it. Everywhere we see the same thing; in Australia and New Zealand we see how the whites treated the indigenous peoples.

* [you don’t believe that the cream of society in England left for some obscure place, leaving their family, friends, work opportunities and creature comforts behind for fame and fortune do you ?]

So when did we change from a commodity based to a non- commodity based society?

I believe it was the introduction of the middleman, a person who saw an opportunity of using goods to trade for other goods, to earn an income. Slave labour is still conducted this very day in a lot of countries; it’s the rate of pay that decides as to the assessment of whether someone is paid what they are worth.

The poor are most likely to sell off their children in every endeavour to make their life easier to live, from indenture labour, specific time frames or out right sale.

Well in the past, the main resource was food and energy, people worked the land, sold the food

Big oil is also driving the bio-fuels bandwagon. Prof. David Pimentel of Cornell University and other scientists claim that net energy output from bio-ethanol fuel is less than the fossil fuel energy used to produce the ethanol. Measuring all energy inputs to produce ethanol from production of nitrogen fertilizer to energy needed to clean the considerable waste from bio-fuel refineries, Pimintel’s research showed a net energy loss of 22% for bio-fuel—they use more energy than they produce. That translates into little threat to oil demand and huge profit for clever oil giants that re-profile themselves as “green energy” producers.

So it’s little wonder that ExxonMobil, Chevron and BP are all into bio-fuels. This past May, BP announced the largest ever R&D grant to a university, $500 million to the University of California-Berkeley to fund BP-dictated R&D into alternative energy including bio-fuels. Stanford’s Global Climate and Energy Program got $100 million from ExxonMobil; University of California-Davis got $25 million from Chevron for its Bio-energy Research Group. Princeton University’s Carbon Mitigation Initiative takes $15 million from BP.

Lord Browne, the disgraced former CEO of BP declared in 2006, “The world needs new technologies to maintain adequate supplies of energy for the future. We believe bioscience can bring immense benefits to the energy sector.” The bio-fuel market is booming like few others today. This all is a paradise for global agribusiness industrial companies like Cargill, ADM and Monsanto, Syngenta.

All this, combined with severe weather problems in China, Australia, Ukraine and large parts of the EU growing areas this harvest season, guarantee that grain prices are set to explode further in coming months and years. Some are gleefully reporting the end of the era of “cheap food.” With disappearing food security reserves and disappearing acreage going to plant corn and grains for food, the bio-fuel transformation will impact global food prices massively in coming years.

Another agenda behind Ethanol?
Uh Huh. The dramatic embrace of bio-fuels by the Bush Administration since 2005 has clearly been the global driver for soaring grain and food prices in the past 18 months. The evidence suggests this is no accident of sloppy legislative preparation. The US Government has been researching and developing bio-fuels since the 1970′s. The bio-ethanol architects did their homework we can be assured. It’s increasingly clear that the same people who brought us oil price inflation are now deliberately creating parallel food price inflation. We have had a rise in average oil prices of some 300% since the end of 2000 when George W. Bush and Dick ‘Halliburton’ Cheney made oil the central preoccupation of US foreign policy.

Last year, as bio-ethanol production first became a major market factor, corn prices rose by some 130% on the Chicago in 14 months. It was more than known when Congress and the Bush Administration made their heavy push for bio-ethanol in 2005 that world grain reserves had been declining at alarming levels for several years at a time when global demand, driven especially by growing wealth and increasing meat consumption in China.

As a result of the diversion of record acreages of US and Brazilian corn and soybeans to bio-fuel production, food reserves are literally disappearing. Global food security, according to FAO data, is at its lowest since 1972. Curiously that was just the time that Henry Kissinger and the Nixon Administration engineered, in cahoots with Cargill and ADM—the major backers of the ethanol scam today—what was called The Great Grain Robbery, sale of huge volumes of US grain to the Soviet Union in exchange for sales of record volumes of Russian oil to the West. Both oil and corn prices rose by 1975 some 300-400% as a result. Just how that worked, I treated in detail in: A Century of War: Anglo-American Oil Politics.
Today a new element has replaced USSR grain demand and harvest shortfalls. Bio-fuel demand, fed by US government subsidies is literally linking food prices to oil prices. The scale of the subsidized bio-fuel consumption has exploded so dramatically since the beginning of 2006 when the US Energy Policy Act of 2005 first began to impact crop planting decisions, not only in the USA, that there is emerging a de facto competition between people and cars for the same grains. Lester Brown recently noted, “We’re looking at competition in the global market between 800 million automobiles and the world’s two billion poorest people for the same commodity, the same grains. We are now in a new economic era where oil and food are interchangeable commodities because we can convert grain, sugar cane, soybeans—anything—into fuel for cars. In effect the price of oil is beginning to set the price of food.”

In the mid-1970′s Secretary of State Henry Kissinger, a protégé of the Rockefeller family and of its institutions stated, “Control the oil and you control entire nations; control the food and you control the people.” The same cast of characters who brought the world the Iraq war, the global scramble to control oil, who brought us patented genetically manipulated seeds and now Terminator suicide seeds, and who cry about the “problem of world over-population,” are now backing conversion of global grain production to burn as fuel at a time of declining global grain reserves. That alone should give pause for thought. As the popular saying goes, “Just because you’re paranoid doesn’t mean they aren’t out to get you.”

F. William Engdahl is author of the book, Seeds of Destruction: The Hidden Agenda of Genetic Manipulation, Global Research Publishing, and author of A Century of War: Anglo-American Oil Politics and the New World Order, Pluto Press. He may be reached via his website, www.engdahl.oilgeopolitics.net .

This is not the first time oil prices came down dramatically just prior to an presidential election in the USA and as world prices are still valued in US $’s, and the value has been climbing somewhat, where to look.  Saudi Arabia is a major player with over 5,000 princes of the royal family who have opulent lifestyles and major investments in the USA (which just happens to have a lot of fire-power if things get sticky over there).

When the September crude future contract closed on Aug 20 it was around $114 but the October contract was at $121 so rolling the contracts over was expensive. Then on 22 August the October contract falls back to $114 so someone got well and truly done over.

OPEC is set to cut oil supplies after weakening demand sparked a sharp price drop – last Friday – of 5.5% to $114.59 a barrel, the biggest drop in percentage terms in one day since December 2004. In London Brent crude dropped $6.24 to $113.92 a barrel.

So what effects oil prices most is demand, if demand drops then so does the price; the USA is in a controlled recession and now that the Olympics are over, China’s demand will drop because of several reasons, a) they didn’t want fuel shortages during the games, so stock levels were kept at high levels (at the expense of business there) but with a major buyer like America out of the mass consumption (fuelled by borrowing against inflated property values), demand has slowed and other economies are likewise feeling the pinch. 6 months before the Games, goods rose an average of 20+% and many industries were allowed to only operate every second day.

A little know fact is that the bureaucrats in the federal government of Australia over the last 20 years have conducted surveys including drilling on the Great Barrier Reef for oil and recently – now that prices have slumped a bit Qld Premier Anna Bligh announced Queensland’s beautiful Whitsunday  region will be placed off limits for shale oil mining.  In a atypical political spin, she claimed ‘the environment must come first’ yet the Qld government is heavily into ethanol despite its high energy consumption poor energy return.   Placing a 20-year moratorium on all mining activities, bulk sampling and exploration over the McFarlane deposit in the Whitsunday region is a token gesture and claiming the only lease, supported by the previous National Party Government currently exists to mine Shale Oil and that is in Gladstone; the same one Premier Peter Beattie gave some $300 millions to.

Bligh’s suggestion the government will devote the next two years to researching whether shale oil deposits can be used in an environmentally acceptable way is a furphy as previously it was unsuccessful here as well as over seas and Canada is having major environmental problems extracting oil from oil sands, a far less energy intensive extraction process.

Meanwhile Caspian oil (not specifically from Azerbaijan) is another example of ‘value-adding’, with oil swaps. Iran is an increasingly popular shipment option for Caspian basin producers. In a typical swap, seller deliveries oil to the port of Neka on Iran’s Caspian shore and takes delivery of the same amount in the Persian Gulf port. These swaps make a lot of sense for the Iranian side considering that most of Iran’s refineries and petrochemical complexes are located in the country’s northern and central regions, while the key oil fields are in the south, swap deals enable them to supply these facilities at a much lower expense, while generating income for handling swap operations.

On average Iran swap costs around $ 4/bbl, including the swap fee of around $ 3/bbl, tanker shipments to Neka and offloading fee. Among companies covered in this report, Dragon Oil, Burren Energy and Petrokazakhstan all utilize these swaps. Moreover, LUKOIL recently announced plans to build a 3 mln tons (60 mbpd) export terminal in Astrakhan, located in the north of the Caspian Sea, with an eye to also utilizing the Neka route.

Neka is already connected to Tehran’s oil refinery via an old pipeline with capacity of 40 mbpd and the new Neka – sari pipeline (built by a Chinese consortium last year) has capacity of 50 mbpd. Neka-Sari represented the first phase of the new three-phase Neka-Tehran pipeline (392 km). Following the recent further expansions, the current capacity on this route is 170 mbpd; according to NIOC, the total capacity of the Neka-Tehran pipeline will reach about 500 mbpd through the construction of additional pumping stations.  So Press reports that Azerbaijan might use Neka as an export route for their oil because the BTC and Baku-Supsa pipelines are not open, are probably just rubbing the USA’s nose in the situation.

An Azeri official says Baku may export its oil via Iran after explosions and conflict disrupted its routes through Turkey and Georgia. The official added the export through the country’s southern neighbour depended on the status of the Baku-Tbilisi-Ceyhan pipeline would. If the BTC is operating there’ll be no need to export via Iran, he said.  BTC pipeline, the world’s second largest, has been shut down since early August after Kurdish separatists bombed a section of it that stretches through Turkey. The military conflict between Russia and Georgia has also led to the closure of the Baku-Supsa oil pipeline that normally transports a daily 90,000 barrels of crude from the Azeri capital to the Georgian port in the Black Sea.  The Swiss Vitol company will load Iran’s light crude, as it has a long-term contract with Iran’s Nikoo Consulting Inc. under which it delivers Azeri oil to Iran at the Caspian Sea port of Neka and load an equal amount of Iranian oil at Khark Island, in the Persian Gulf.

The ongoing crisis in the Caucasus is intimately related to the strategic control over energy pipeline and transportation corridors and there is evidence that the Georgian attack on South Ossetia on August 7 was carefully planned. High level consultations were held with US and NATO officials in the months preceding the attacks; the attacks on South Ossetia were carried out one week after the completion of extensive US – Georgia war games (July 15-31st, 2008). They were also preceded by high level Summit meetings held under the auspices of GUAM, a US-NATO sponsored regional military alliance.

As Dave Kimble suggest, this is all about oil geopolitics; its puzzling how Russia can be thought to be at a disadvantage when these pipelines are either delivering Russian oil to the West, or are delivering someone else’s oil via Russia to the West, or don’t involve Russia at all. The West is clearly disadvantaged if Russia’s taps are closed and Russia is not disadvantaged if the BTC or Baku-Supsa is closed. If they all want to start bombing each other’s pipelines then there is nothing any of them can do to protect them.

Russia says oil output to stagnate by 2011 and oil output growth is unlikely to exceed 2.2 percent next year and will slow to under 1 percent by 2011, the government said on Thursday, confirming earlier forecasts of a slowdown in production growth. Falling oil production in Russia, the world’s second-largest crude exporter after Saudi Arabia, has become a major concern for the government, which relies heavily on export revenues.

The government quoted the Economy Ministry’s updated forecast for Russian economic development to 2011 as saying oil output could this year reach 492 million tonnes, or 9.85 million barrels per day, almost flat from 491.5 million tonnes, or 9.87 bpd, in 2007. This year, a leap year, has one extra day.

Proving economists continue to grapple with the concept that resources are finite, the Russian Economy Ministry’s optimistic scenario of oil production to rise to 503 million tonnes in 2009, growth will slow to just 0.8 percent year-on-year in 2011, reaching 518 million tonnes. Last month, the Finance Ministry announced similar forecasts of oil production growth in the period.  Russian oil production was down 1 percent year-on-year in the first seven months of 2008 after a 2.3 percent increase in 2007 and huge spikes in previous years, including a record 11 percent in 2003.  Analysts expect oil output growth to recover in the next decade after a number of new major deposits are launched in Eastern Siberia, which is rich in resources but lacks infrastructure. Eastern Siberia is expected to compensate for falling output from mature fields in the traditional oil-producing region of Western Siberia.

Meanwhile, Petroleos Mexicanos, the state-owned oil company, said April crude production fell the most in more than 12 years as output at its largest field declined faster than the company forecast. Crude oil production fell 13 percent to 2.767 million barrels a day in April, Mexico City-based Pemex, as the company is known, said today on its Web site. Output a year earlier was 3.182 million barrels a day. The decline was the largest since October 1995, when output fell 29 percent.  Although the company set a goal of producing 3.1 million barrels of crude a day in July of last year. The company has only met that goal once since it was set. Output has been on a decline since reaching a peak in December 2003. Since 1999, proved reserves have been more than halved to 14.7 billion barrels of crude oil equivalent.   Mexico’s Congress must pass a bill that would give Pemex more freedom to hire foreign and private companies to explore, produce, refine and transport oil, the changes would give Pemex more cash to explore and produce oil to staunch the decline.  Output at Cantarell, Pemex’s biggest field, fell 33 percent to 1.07 million barrels a day, according to the Energy Ministry. That was the lowest output since March 1996 at the field, which peaked at 2.192 million barrels a day in December 2003 and once accounted for about 60 percent of the company’s output.  The company forecast output at Cantarell would fall 15 percent annually until 2012.  Exports fell 14 percent to 1.439 million barrels a day and Pemex – as the third-largest supplier of crude to the U.S. – said it will cut exports as output falls so that it can refine more of its own oil.

And under the banner ‘it could only happen in America’

San Francisco can’t even install new bike racks when most other cities are encouraging biking as green transport, the 65-year-old local gadfly has stymied cycling-support efforts here by arguing that urban bicycle boosting could actually be bad for the environment. That’s put the brakes on everything from new bike lanes to bike racks while the city works on an environmental-impact report.  Cyclists say the irony is killing them — literally. At least four bikers have died and hundreds more have been injured in San Francisco since mid-2006, when Mr. Anderson helped convince a judge to halt implementation of a massive pro-bike plan.(It’s unclear whether the plan’s execution could have prevented the accidents.) In the past year, bike advocates have demonstrated outside City Hall, pushed the city to challenge the plan’s freeze in court and proposed putting the whole mess to local voters. Nothing worked.

’We’re the ones keeping emissions from the air, shouted Leah Shahum, executive director of the 10,000-strong San Francisco Bicycle Coalition, at a July 21 protest. Mr. Anderson disagrees. Cars always will vastly outnumber bikes, he reasons, so allotting more street space to cyclists could cause more traffic jams, more idling and more pollution. Mr. Anderson says the city has been blinded by political correctness. It’s an “attempt by the anti-car fanatics to screw up our traffic on behalf of the bicycle fantasy,” he wrote in his blog this month.

Meanwhile, sit back and proclaim you’ve achieved a monumental green victory (President Bush, anyone?) all while unleashing a dangerous spike in global food prices that’s causing a ripple effect of food shortages and rationing around the world.

Politicians need to spend less time bragging about their latest green-washing schemes and more time studying The Law of Unintended Consequences.

Because while growing fuel on cropland initially sounds like a great idea, any honest assessment of the total impact leads you to the inescapable conclusion that biofuels are largely a government-sponsored scam.

With a few exceptions, biofuels produce no net increase in energy output, and they cause food shortages while creating strong economic incentives for the destruction of the very rainforests we desperately need to stabilize the climate!

And now we’re just starting to see the early signs of the economic and social insanity that has been unleashed by this foolish pursuit of biofuels around the world: Food rationing in Sam’s Club stores in the U.S., rapidly-rising prices on bread, rice and corn, and price spikes at cafeterias and restaurants that depend on these staple ingredients. The price of rice has tripled globally, unleashing riots in Haiti and Bangladesh, and the United Nations has issued warnings that millions of people around the world now face starvation because they can’t afford to buy food. Americans are even starting to hoard food once again, after years of avoiding basic preparedness measures. (One benefit to all this, however, is that farmers are actually getting paid decent prices for their crops now, after years of operating on the verge of bankruptcy…)

One final thought: I am an advocate of the idea that Mother Nature needs to be granted legal standing. I believe that humans do not automatically “own” nature, and that we cannot simply cut down forests, bulldoze mountainsides, fish the oceans, build dams and engage in other highly disruptive activities without first getting permission and paying royalties to a global Mother Nature Authority that stands up for the rights of the planet. Nature is not ours to own or destroy. We, as the guests on this planet, have no right to simply assume ownership over other living systems on this planet and exploit them for our own financial gain. The “destroy and consume” model of free market enterprise is simply not sustainable, folks. It does not lead us to a happy future; it leads to our own destruction.

Or, put another way, over the last hundred years or so, mankind has committed countless acts of violence against nature. It has pursued a policy of committing atrocities against Mother Nature — a kind of genocide against anything non-human (animals, plants, fish, etc.). Humans have proven themselves to be, by far, the most violent and destructive life forms to ever exist on this planet. And yet paired with that violence, humans are an infant species, with little or no foresight, with virtually no ability to see the future implications of their own actions. We are, in a sense, the dumbest intelligent creatures ever to walk the face of this Earth.

We can land a man on the moon, but we can’t even prevent our own rainforests from being clear-cut by soybean farmers and cattle ranchers. We can develop high-tech medicines, but we can’t even openly recognize the more powerful medicines found in a simple dandelion plant. We can create amazing computers and televisions and internet technologies the beam information across the globe at the speed of light, but we pollute those information pathways with corporate ads for useless stuff and dangerous medicines that only make our fellow humans beings less enlightened. We are capable of so much, and yet we have accomplished so little. We are, by any honest assessment, a race of little children, running around the planet with far too much power and not nearly enough maturity. We’re like a band of infants with flamethrowers.

Frankly, we don’t deserve this planet, and Mother Nature is about to take it away from us. It’s time for us to either grow up, or perish. And all these people who say “we have to protect the economy, not the environment” should probably just be rounded up and shipped off to Mars where they can play with the Martian dust all they want until they finally get the picture.

http://www.naturalnews.com/023091.html

As a result, it’s suddenly becoming obvious to nearly everyone that the pursuit of biofuels, as currently structured, is a grand green-wash hoax. It doesn’t produce more fuel than it consumes, and it drives up food prices to boot!

Now, there are biofuels programs that really do work. The growing and harvesting of sugar cane in Brazil, for example, provides an 8-to-1 return on energy investment. But even that pursuit is tarnished by claims of unsafe work environments and massive environmental pollution (the sugar cane fields are burned before being harvested, a process that releases massive amounts of CO2 into the environment).

The only truly promising biofuels technology available today is based on micro-algae. Feed CO2 to a vat of algae, and you can produce biofuels cheaply and responsibly, without destroying the environment. But these programs are only in experimental phases. Nobody is producing biofuels on a large scale from algae farms (not yet, anyway). And that leaves the great American breadbasket: The corn and wheat fields.

It is here that food is now being displaced by crops grown for biofuel processing. So where a farmer used to grow corn as a food source, he’s now growing it to sell to a biofuel processing facility which turns the corn into ethanol. Obviously, the laws of economics come into play here, meaning that every bushel of corn used for biofuels production means one less bushel of corn available for food. Factor in the laws of supply and demand, and you can see that the more crops we use for biofuels, the higher the prices will rise for food.

Politicians, it seems, have no understanding of economics. They need to study the basics as they are presented in Henry Hazlitt’s Book, Economics in One Lesson, which is a Libertarian-oriented guide that explains basic economics to anyone willing to learn. Economics is focused on the study of human behaviour, or more precisely, consumer choice. Now, it seems, consumers are about to be faced with a choice they never wanted to have to make: Should I buy fuel, or food? In other words: Do I want to drive my car, or do I want to eat?

You can have fuel or food, but not both Under a biofuels-focused agricultural policy, the same limited resources (soil, sunlight and water, essentially) can be used for only one thing at a time. You can’t use the corn twice, obviously (you can’t eat the corn and process it for biofuels at the same time), so you’ve got to make a choice: Will you grow the corn for fuel, or for food? The more you grow for fuel, of course, the less food you have, and that drives up food prices. But if you swing back the other way and grow more corn for food to ease food prices, the fuel prices go up. Trying to solve both problems at once is a bit like trying to pick up a wet watermelon seed with your fingers: It keeps slipping to the side.

One thing that has become abundantly clear in all this is that the era of cheap food and cheap fuel is over. I’ve written about this on Natural News, where I use the term “food bubble” to describe the most recent era of cheap food. As it turns out, cheap food is only made possible by cheap oil, and with oil now approaching $120 a barrel (a price that virtually no one thought possible just two years ago), food prices are simultaneously skyrocketing. (Modern farming practices use a lot of fossil fuel. So does transporting food across the country or around the world. Eat local, folks!)

Add to this the fact that global climate change is already underway, altering weather patterns and creating floods, droughts and other agricultural calamities, and you start to get the picture of just how bad things might get. That’s not even to mention the very serious problem of collapsing honeybee populations due to a mysterious condition called colony collapse disorder that’s devastating honeybee populations across North America right this minute. Honeybees, in case you didn’t know, pollinate plants that represent about 30% of all the calories consumed by Americans. That’s about one out of every three bites of your dinner, and it all depends on the “free” work performed by honeybees — bees who are apparently going on strike by refusing to keep working for us.