Corn and Economics

There's an interesting conversation on the Becker-Posner blog (they are 2 economists from the U of C) about ethanol subsidies, the rise of food costs, its possible impact on developing countries, and the politics of agricultural subsidies in the US. It is a little long, but I thought it was informative. One interesting thing I hadn't realized: the fact that the state of Iowa plays such a large role in the primaries affects how politicians support subsidies. According to Posner, Iowa caucuses extract pledges from possible presidential candidates to preserve and expand the home-grown ethanol industry, making the issue of ethanol subsidies bi-partisan and unlikely to generate a lot of critique.