Saturday, September 24, 2011

Natural gas subsidies poisonous to economy

Subsidies make corn
cost more
Energy central-planning isn't limited to solar power. The New Alternative Transportation to Give Americans Solutions Act of 2011, smartly named NAT GAS Act, offers un-capped federal subsidies to companies that switch their fleet vehicles to those with natural gas-powered engines.

Since natural gas is plentiful in the United States, on the surface that seems like a sound idea. But as we learned with the shove into ethanol production, there are macroeconomic consequences with such maneuvers, removing corn from food-production results in higher food costs.

The primary use of natural gas is for heating. Less gas for heating means higher utility costs for consumers. Meanwhile, the Environmental Protection Agency continues its war on fossil fuels. The natural gas front involves curtailing hydraulic fracking.

Food is more expensive when natural gas costs increase. Eighty percent of the expense of nitrogen fertilizer comes from gas.

Let the market decide.

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