The Invisible Hand Influencing Destructive Policies

Stanley Feld M.D.,FACP,MACE

My son, Brad, had an interesting item in his blog of December 23, 2007.

“And – if you need more for your inner cynic, how about the article in today’s Rocky Mountain News titled Clouds hover in ethanol sky. E85 (assuming you can find it) apparently costs 78% less than regular unleaded gas but gets 71% less per gallon. Since its 85% ethanol, it presumably is less polluting (assuming that the total ethanol lifecycle consumes less energy than gasoline) but doesn’t save the consumer any short term money.”

I believe there is an invisible but real hand manipulating the corn for fuel debate. Each of the powerful stakeholders is simply pursuing its vested interest. The government “sovereign” of Adam Smith should make appropriate rules for the common good. Then the sovereign should get out of the way and let the stakeholders pursue its vested interests.

Several things are clear. Americans are becoming more obese each year. As Americans become more obese they develop more chronic diseases such as heart disease and diabetes mellitus. The increase in these diseases result in an increase in these diseases complications. These complications consume 80 to 90 percent of our healthcare dollar. We do little to nothing to support the prevention of these diseases or complications. The infrastructure of healthcare is on the verge of collapse. It is threatening America’s economic viability.

A large contributor to obesity and diseases resulting from obesity is the ubiquitous processed food. Processed food depends heavily on corn, corn oil and corn syrup. America’s dependence on foreign fossil fuel (oil and gasoline) is also threatening the sustainability of our economy. If we could shed ourselves of this fuel dependence and use renewable fuel sources our economy could remain viable.

A few weeks ago I suggested that our government ban the use of corn products in our food stuff. America should restrict is use for renewable energy only. This rule could solve our obesity problem and energy problem at the same time.

The food industry was bothered by this suggestion because the profit margin on processed foods, though difficult to calculate because costs are so opaque, is tremendous compared to the profit margin for producing fuel from corn. The farm industry could even genetically engineer corn to be 6 feet tall and generate more fuel per seed without adverse public opinion.

If the food industry produces corn for fuel plus foodstuff, they have an excuse to mark up food even higher than they have in the past year.

The fuel industry claims that the amount of fossil fuel to produce corn fuel (ethanol) results in a net increase in the cost of ethanol. Has the fuel industry never heard of solar and wind power to produce electricity to power the production of ethanol? One hundred years ago America used water power mills to generate electricity to manufacture all sorts of products. Water power represents another free electricity generating power source.

The point of the Rocky Mountain News article is that ethanol contains less energy than fossil fuel. Therefore the cost of the fuel is a wash. The cost of producing ethanol would be less if we used renewable sources such as wind and solar power to produce the ethanol. The government would have to make the appropriate rules and provide subsides for renewable sources. However, we would not run out of it or be dependent on others for it.

Recently, the automobile industry fought the government’s requirement for auto fuel efficiency.

I suspect it would be very easy to make ethanol fuel efficient cars. Toyota will show us how to do it. I would bet that our automotive industry could produce engines that would increase the energy output of fuel ethanol by simply modifying the fuel injectors. (Popular Mechanics 2007)

The point is none of the powerful stakeholders want to do any of the above. The government and politicians dependent on backing from these powerful stakeholders will not step forward and make these innovative changes.

We have not heard one presidential candidate from either side make any of these points. Americans are very good at spinning a story to manipulate public opinion and marginalize the value of these innovations to protect its vested interest.

It will take counter spin by the public to force the politicians to make policies that are for the public good. Now is not the time to complain and be cynical. It is time to act. America has the infrastructure to act in the internet and blogosphere. If social networking gets serious the power will return to the people.

Citizens have to create an environment where we are no longer a sound bite society. We must understand the details, and create the paradigm shift through public opinion for the public good. We have seen this happen rapidly. It is time to stop being manipulated by the invisible hand that uses media spin to manipulate us.

America can and must solve its healthcare problem and fuel crisis. We can do it with innovative thinking and appropriate rules.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.
Stanley Feld M.D.,FACP,MACE