It’s not quite the same as the “recycling” scam, but it’s close...

This is just nuts and another example of (i) good intentions driving policy without examining the bad results and (ii) what happens when the market is influenced by subsidies rather than, well, the market.

From John Fund’s column at WSJ’s opinion website:

As for corn-based ethanol, Jerry Taylor of the Cato Institute calls the current mania to subsidize it "the closest thing to a state religion America has." Corn farmers have done a good job of disguising the fact that it still takes more than a gallon of fossil fuel — 29% more is the best estimate — to make a gallon of ethanol. [emph added] In addition, various mandates requiring the use of ethanol significantly increased gasoline prices last summer and led to spot shortages because ethanol can't be carried through pipelines and requires special blending plants. James Glassman, an economist with J.P. Morgan Chase, notes that expensive ethanol was a big factor in the sticker shock consumers encountered at the pump this summer. "We'd probably have retail gasoline prices between $2.30 and $2.40 a gallon if not for ethanol," he told The Wall Street Journal last June, when pump prices were topping $3 a gallon.

So, it takes a almost 1.3 gallons of gasoline or oil or the equivalent of natural gas or coal to create a gallon of ethanol. And not only that, I paid an extra $0.50 per gallon of gasoline this summer because of it.

Terrific policy. Right up there with recycling.