Tuesday, August 23, 2011

The cost of the Ethanol Mandate is not chicken feed....The Federal Government is bailing out chicken producers because the price of chicken feed is increasing---because of the Federal Ethanol Mandate. Does anyone else think this is kind of crazy???

How timely. Today in class I used the ethanol mandate as a way to illustrate Frederic Bastiat's "Seen and the Unseen" and the damaging effects of a policy gone awry, but not gone away.  While the article below is not about ethanol, there is a connection. See if you can find it...

""The United States is stepping in to help bail out another American industry -- chicken farmers and meat processors.

The nation's chicken industry is having a difficult year. Chicken producers are struggling with higher costs of running their business at the same time that consumers are buying less meat.
This has created a glut of chicken products in the market.

The Department of Agriculture, keenly aware of these issues, announced Monday that it will make a special purchase of up to $40 million of chicken products, which the government will then donate to federal food assistance programs such as soup kitchens and its national Feeding America programs.

"At a time when the industry is under great stress due to the high cost of feed ingredients and the general economic slowdown, we appreciate USDA's willingness to step forward," the group said in a statement...."

Keeping in mind the focus of my lecture today I have to ask: WHY is chicken feed increasing in price? Anyone? Anyone? Anyone?
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