Obama, Starving Africans and the Israel Lobby

Written by Atheo – Aletho News – May 9, 2009

This past week, U.S. President Barak Obama announced a plan to displace 11 percent of U.S. oil consumption with biofuels by 2022, offering $786 million in subsidies to energy corporations for new refineries in an ethanol industry that is far from being economically viable.

Under the new Obama plan the Environmental Protection Agency (EPA) will require fuel refiners and importers to guarantee that a percentage of their fuel is from renewable sources. The percentage will increase each year until the country is using 36 billion gallons of renewable fuel by 2022.

“It’s another opportunity for producers to profit” Agriculture Secretary Tom Vilsack says, but the fact that the plan is being marketed as such might suggest cause for caution in an industry that exists almost wholly due to federal mandates.

“Our economy is at the mercy of foreign oil producers, and everybody feels that when it hits us at the pump,” EPA Administrator Lisa Jackson said in support of the new plan. In fact though, recent events in the oil markets reveal that it was market activity rather than suppliers that caused the oil price bubble. Just as with real estate, there never was a lag in supply and prices were boosted by speculative trading with some shipments exchanging hands dozens of times while en route to their destinations. Hedge funds gambled with highly leveraged portfolios of oil futures in a bubble market fed by alarmist fears of ever compounding rates of growth in oil demand balanced against projected future oil production data that didn’t recognize unconventional oil.

The reality is that energy producers, whose economies are reliant on exports for as much as 95% of their income, are much more at the mercy of the demand-side driven market. Entire national government budgets are funded by nothing else but oil receipts. Energy production and supply is an industry that is characterized by interdependence between importer and exporter, this is why Europe and China are engaging in long term supply contracts that offer stability for all involved.

Left unaddressed by the Obama team is the harsh reality of globalized commodity markets which will see basic food prices sustain price rises that result in starvation for hundreds of thousands or as many as tens of millions of the world’s poorest, often landless, populations. It takes 232 kilos of maize to fill a standard gas tank with fuel. In this case, supply and demand are actually at work affecting market prices and economic choices such as which type of use land is put to.

Hilaire Avril of Inter Press Service writes:

Responding to European hunger for biofuel, many African countries have expanded single-crop farming surfaces. But only large businesses have the resources and capital to reach the critical size that allows for economies of scale which make the venture profitable.

Smallholders, which in countries like Benin account for the majority of land use, and up to 80 percent of employment opportunities, do not benefit from the biofuel windfall. In addition, land, water and other limited resources are being diverted from scarce food-producing crops.

Several international institutions, including the International Monetary Fund and the Food and Agriculture Organisation, have acknowledged in recent years that the increasing demand for biofuel crops has catastrophic social, economic and nutritional impacts on developing countries and their already tense food resources.

In Senegal, which was affected by food riots a year ago, up to 200,000 hectares (10 percent of the country’s arable lands) might be set aside for jatropha crops for biofuels.

Second and third generation biofuels are supposed to limit environmental and social impacts because of either the use of non food-producing crops or biomass such as algae and fungus.

“That’s a sham,” insists Ambroise Mazal of the Catholic Committee against Hunger and for Development, “because second generation fuels made from non-edible crops still take up arable lands and the research is far from developing sustainable biomass in laboratories.”

Why did Obama choose to exceed both the Bush and E.U. mandates? Even the Congressional Budget Office has reported that ethanol mandates drive food prices higher. While Obama’s connections with corporate agriculture are well documented and widely reported, less discussed is the Israel lobby’s interest in “energy independence”. It seems that as in so many other crucial areas of U.S. policy, the Israel lobby has been influencing the energy agenda as well. Nancy Pelosi perceives a need (for America?) to “achieve independence from Middle East oil.” Even though imports from Middle East sources account for only a small percentage of U.S. oil imports. One wonders just what scenario of hers results in a cessation of oil exports from the Middle East, Israeli aggression on Iran perhaps?

House Speaker Nancy Pelosi at a 2007 AIPAC conference:

“With innovation, we broaden our horizons, and expand our vision, in order to create a better world. That is why House Democrats have introduced our Innovation Agenda: A Commitment to Competitiveness to Keep America Number One. I know this is an area where the United States and Israel can work together.

“At the end of February, the House passed legislation to foster joint projects between the United States and key allies such as Israel, which offer the promise of using the best new innovation to improve security for all of us.

“In energy policy, the United States and Israel have another opportunity to combine our best innovative ideas. The U.S.-Israel Energy Cooperation Act would help fund joint ventures between United States and Israeli businesses and academic institutions for the development and commercialization of alternative renewable energy sources.

“American and Israeli ingenuity can be put to work to achieve energy independence from Middle East oil. A sustained investment in research and development is crucial to creating cutting-edge technologies to develop these clean, sustainable alternatives and capitalize on vast renewable natural resources, including solar energy and wind power.

At the recent AIPAC conference the program featured Mr. Andy Karsner Former Assistant Secretary of Energy, Office of Energy Efficiency and Renewable Energy and Mr. Jonathan Baron Founder and Principal, Baron Communications LLC giving a report titled:

Middle East Spotlight – Energy Independence: How National Energy Policy Impacts Our Security

The majority of the world’s oil sits beneath the sands of unstable nations and under the control of hostile authoritarian leaders. Is there still an American appetite for energy independence? If so, what will it take to achieve, and can such a move secure our nation? [emphasis mine]

Are biofuels really a sensible way for the U.S. to address the “hostility” of Middle Eastern leaders or would it be more in America’s interests to remedy the cause of anger? The biofuels “energy independence” policy offers a grim view of a future so warlike that America’s trade relations with entire, economically significant, regions are shut off. Is this Obama’s “forward looking” vision?

Related article

• The Israel Lobby’s War on America’s Middle East Oil Dependence

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