Friday, June 15, 2007
THE REAL PRICE AT THE PUMP
According to the center for technology assessment, about $9-18 billion dollars worth of tax breaks are provided for gasoline production and use. The defense department allots $55-$96 billion per year to protect petroleum resources across the globe.
I’m not necessarily advocating increasing the price at the pump by increasing gas taxes to reflect these costs. However, if these costs were factored into the price of gasoline, it appears that the gap between the real cost of ethanol and the real cost of gasoline would narrow significantly even after the subsidies to ethanol were removed.
Sources: Ethanol Today, August 2005
‘The Real Cost of Gas’ International Center for Technology Assessment 1998
Friday, June 08, 2007
COLONY COLLAPSE DISORDER II
An entomologist at the University of West Virginia contends that the issue is mites. He has developed a product that consists of lemon grass and spearmint that seems to be protecting hives. Many studies suggest that a protozoan parasite called Nosema ceranae may be playing a role. Another team of scientists at Edgewood Chemical Biological Center and University of California San Francisco have identified a virus that may be responsible.
It is just too early to start pointing fingers at just one thing. If it turns our to be transgenic crops, then this will be the first negative impact ever cited! And of course, because transgenic crops are produced by making small precise changes in plants, they can likely be tweaked to alleviate the problem.
SOURCE: http://www.sciencedaily.com/releases/2007/05/070518144833.htm
Monday, June 04, 2007
MINIMUM WAGES- FOR WHO?
Are minimum wages really effective at alleviating poverty? A few weeks ago Walter Williams wrote a fact filled column regarding minimum wages. The facts reveal that minimum wage increases actually prove to be more beneficial to big business and the working middle class as opposed to the working poor.
http://jewishworldreview.com/cols/williams042606.asp
The following facts seem to shed light on many of the popular myths about why we should raise the minimum wage ( either at the state or federal level).
1) after 3 years 85% have found better paying jobs, or have recieved raises
2) only 5% of minumum wage earners are below the poverty line, while almost half have come from families earning $60,0000 or more per year.
3)80% of the people earning minimum wage have no dependents. They are either single, or a working couple with no kids. A vast number are aged 16-25.
Big business benefits because they are better able to manage the increased costs and disruptions to the labor market that result. Smaller businesses become less competitive. In the 90’s when we raised the minimum wage we saw an age of small towns becoming ghost towns while Wal-Mart dominated.
Friday, June 01, 2007
MEXICAN CORN PRICES AND ETHANOL
In a recent Christian Science Monitor article, many good points were made about the effects of ethanol on corn prices. I’m not sure every point was on the mark however.
"..in Mexico, where corn is a staple food, the price of tortillas has skyrocketed because US corn has been diverted to ethanol production. "
It is my understanding that another major issue with tortilla prices (food grade white corn) is the lack of biotech varieties. There have not been enough biotech white corn varieties approved for human consumption, making these crops much more difficult and expensive to grow for our producers, so few are willing to grow it anyway. As a result, white corn accounts for less than 1% of US corn production, and already trades at a premium.
Further, even with NAFTA, there are trade barriers that prevent US corn producers from exporting white corn to Mexico. Even in the case of drought and severe shortage over- quota tariffs are quite steep.
Now I also understand that increased corn prices may be leading producers to destroy agave crops- used for tequila. Would the price of corn in Mexico be so high if they could relieve market pressure by importing ?
If ethanol has anything to do with the current plight of Mexican food prices, it is only adding to the misery created by previously existing anti-free trade policies.
Tuesday, May 29, 2007
COLONY COLLAPSE DISORDER
“However, even though imidacloprid is systemic and moves through the plant, it is known to not get into the flowers of a number of plants. With bees primarily visiting flowers, there are questions as to how the bees would pick up the imidacloprid. Another question is when the honey bees pick up the imidacloprid. Many imidacloprid-treated crops finish flowering by midsummer, allowing time for seed or fruit to be produced and ripen before frost. Honey bees tend to feed in late summer and fall on late-season flowers such as goldenrod and native asters. These plants tend to be most numerous in noncrop areas where insecticides are unlikely to be applied. If the bees died earlier in the season from visiting flowering crops, beekeepers surely would have noticed this when they collected honey from the hives.”
If you recall the refuted study that came from Cornell Univeristy a few years ago you will remember Bt genetics have already been prematurely blamed for killing monarch butterfly. Now some are suspecting that Bt corn is the culprit in CDD. Let’s see what the experts from the University of Maryland have to say:
“The endotoxins currently expressed in Bt corn (Cry1 types against caterpillars; Cry3 types against beetles) are not biologically active against hymenopteran insects such as the honey bee, nor do the CCD symptoms resemble those expected in Bt intoxicated organisms. Exposure is also very low because the expression of endotoxins in pollen is barely detectable in most Bt corn hybrids and corn does not produce nectar. For these reasons, bees are not commonly found foraging in corn fields.’
Note, imidacloprid is one of the safest products introduced in decades. To restrict its use would either mean a switch to more lethal chemistries or organic methods that also may have questionable effects on the environment- recall organic producers broadcast the Bt toxin over their crops and kill all insects whether they are pests or not. The environmental benefits from Bt genetics are numerous as indicated in many of my previous entries. Restricting its use would be detrimental to the environment and public health as well. Let’s get to the bottom of CCD instead of trying to push an anti biotech or anti-agricultural agenda.
SOURCES:Illinois Pesticide Review, http://www.pesticidesafety.uiuc.edu/newsletter/newsletter.htmlGALEN P. DIVELY.Extension Pest Management Specialist, University of Maryland http://www.americanfarm.com/TopStory5.01.07f.html
Thursday, May 24, 2007
WHITE HOUSE MAKES THE CALL ON GAS PRICES
As the Washington Times reports, yesterday the house passed a bill to make price gouging a federal crime. This is an example of 'doing something and accomplishing nothing.' The enforcement mechanisms would only kick in if there was a national emergency such as hurricane Katrina. Of course, during times like this ,that is when price rationing is most crucial. As I mentioned last year ( November 9, 2005-Gas Prices II-Unspoken Miracle), it was a miracle that we got through that crisis and were still able to find gas at the local station.
Correctly reasoning, the White House claimed this would "bring back long gas lines reminiscent of the 1970s." If you know your history and economics you will recall that those lines were created by governement regulation. They were not the direct result of an energy crisis. The Federal Trade Commission has found little evidence of price gouging and also testified against the legislation. President Bush vowed to veto the legilsation if it passes in the Senate.
Tuesday, May 22, 2007
GAS/TRAVEL IS STILL CHEAPER?
The above link should take you to a related intersting blog link that I found at the Knowledge Problem blog. We've all observed the tremendous increase in 'nominal' gas prices recently, and nominally they have reached an all time high. Adjusting for inflation, however, gas still is not as expensive as it was in the early 80's. If you look at the percentage of household income spent on transportation- miles traveled- ( a factor that even inflation adjustment does not account for) you will find that even for the lowest income earners, travel is still cheaper today than it was in 1981.
It is amazing what advances in technological progress and economic growth can do to cushion the effects of major problems. Although travel costs have not reached a historical peak, they may be on their way if increasing 'nominal' prices are any indication, and as I have said before, the problem deals mainly with the failure to increase refining capacity in over 30 years.
Saturday, May 19, 2007
SHOULD SOMEBODY DO SOMETHING?
"Supplies are decreasing--both temporarily through unexpected refinery shut-downs and permanently through stock depletion. Demand is increasing--both in the U.S. and worldwide. Both of these will cause gas prices to rise and that's good. If gas prices don't rise, we will consume gas even faster and run out sooner. "
He describes the situation well. But what should be done about it. Windfall profit taxes as some of our presidential candidates are proposing would only discourage more refining ( and may actually even discourage investment in alterantive fuels). Setting price caps would counter the rationing effect of prices, and generate longer lines, violence, or closed gas stations like in the 70's. In the short run, the only relief for consumers that makes sense is repealing gas taxes. In the long run we have to focus on decreasing demand- via alternatives- and we should focus on increasing supply by buidling more refineries.
Thursday, May 17, 2007
WAL-MART- ORGANIC COTTON?
Apparently in some stores Wal-Mart is introducing lines of clothing produced from Organic Cotton. From the corporate web site:
“So, we expanded our organic practice to include select bath, bed and baby products. From just these few orders in a limited number of stores, the Organic Exchange has informed us we will have saved 50,000 – 60,000 lbs of pesticides, herbicides and synthetic fertilizers and other chemicals from being used, and have become the largest single purchaser of 100% organic cotton products in the world.”
Unfortunately, Wal-Mart does not have all the facts about agricultural sustainability. They may have saved 50,000-60,00 pounds of synthetic pesticides, but what about the toxic biological controls used in organic production such as pyrethrum, neem, sabadilla, and rotenone that government regulators don’t even track data for. In citing this data, is Wal-Mart comparing only conventional cotton to organic? What about the environmentally superior biotech varieties of Bt and Roundup Ready cotton?
All of the advantages that Wal-Mart is seeking to exploit from organic food are available via biotech cotton. As noted in previous biotech entries there are many advantages to these technologies in relation to environmental sustainability that organic production cannot provide. ( See 7 reasons why you should support GM food, May1, 2007, Bt Cotton & Environmental Health, or click on biotech label at the end of this entry). While organic product promotion is most likely just a marketing and PR ploy by Wal-Mart, and involves just a limited array of the products they have to offer, they are now the single largest purchaser of 100% organic cotton products.
As a result, because Wal-Mart deals in such large volume, Wal-Mart may be doing more harm than good when it comes to the environment in their decision to buy and sell organic.
Tuesday, May 15, 2007
Master of Science in Agriculture (Ref.#052)
The Master's Degree is a general degree in agriculture and can be thesis or non-thesis depending on student goals. The degree is general by design which allows for maximum flexibility for each student.
Emphasis in Biometry(Applied Statistics)
As defined by R.A. Fisher “Biometry, the active pursuit of biological knowledge by quantitative methods” is the application of statistical and quantitative methods to problems in agriculture and life sciences.
This is an interdisciplinary emphasis, combining formal course work with applied problem solving projects and cooperative education. Course work includes statistical inference and experimental design with applications to a variety of problems relevant to agriculture and life sciences.
Applied Statistics and Experimental Design
AGRI 590 EXPERIMENTAL DESIGN 3
AGRI 597 IND SPEC PROB/AGRIC: GAME THEORY/TRAIT RESISTANCE MGT 3
AGRI 475G SPECIALTY CROP PRODUCTION 3
AGRO 521 PASTURE MANAGEMENT 3
AGEC 468G WORLD FOOD DEVELOPMENT 3
Friday, May 11, 2007
ECONOMIES OF SCOPE IN BEEF AND ETHANOL PRODUCTION?
Currently in Meade Nebraska an ethanol plant has started production in conjunction with a cattle feedlot. In this operation 30,000 head of cattle will supply manure that will be used to create methane gas via an anaerobic digester.
Methane is 21 times more powerful than CO2 when it comes to heating the atmosphere. So instead of being released into the atmosphere this gas will be used to operate the ethanol plant instead of using natural gas. The residual of the grain used for ethanol would then be used as cattle feed and the residual from the manure digestion could be used as fertilizer for the supplying corn crop. All of this implies less petroleum use in ethanol production, swaying the energy balance to the positive, and perhaps indicating economies of scope in corn, beef and ethanol production.
SOURCES:
http://www.epa.gov/methane/scientific.html
www.iowafarmertoday.com
Wednesday, May 09, 2007
ETHANOL AND ENERGY BALANCE
So it seems the jury is still out on the energy balance of ethanol, with a slight advantage on the positive side.
SOURCES:
http://environment.newscientist.com/
Natural Resources Research, vol 14 p65
Science, vol 311 p 506
Tiffany Goode, MIT (Graduate Student)
PNAS July 25, 2006 vol. 103 no. 30
Thursday, May 03, 2007
BEEF PRODUCTION NOT ALL WET
Green-Zine is not the first to cite the 5200 gallon figure. Many groups have used it, making such claims as people consume enough beef to float a battleship in terms of the associated water input required to produce it. I did find a 1978 study on my own that corroborated the 5200 figure, but also found studies with numbers 2500, 840, and UC Davis research citing 441 gallons of water per pound of beef. The NCBA ‘National Cattleman’s Beef Association lists 435 gallons as the official estimate. (one group criticized this research because one of the researchers wore a cowboy hat-indicating industry connections). As indicated in my previous entries on beef, beef production is more environmentally friendly than ever before.( see 'beef ' label at end) If it is true in 1978 that it required 5200 gallons of water to produce 1 pound of beef, then in a worse case scenario where it would require 2500 gallons of water, beef production is about 200% more water-use-efficient than 28 years ago. If the NCBA figures are correct, then beef production is 12 times more water efficient than 28 years ago.
These numbers should only improve with the introduction biotech feed crops that are more drought tolerant and require less water. I doubt that the improvements in organic production will keep pace with the recent advancements we’ve seen. So, if there ever was a time to eat beef, now is it! The environmental foot print is smaller than ever.
Tuesday, May 01, 2007
7 reasons why you should support the production of genetically modified food:
2) Improved Soil Conservation
3) Improved Nutrient Profiles
4) Carbons Sequestration - Carbon Credits
5) Improved Biodiversity
6) Decreased Dependence on Fossil Fuel
7) Reduces Greenhouse Gas Emissions
Explanatory Notes:
Roundup Ready technology has allowed for glyphosate herbicide to substitute for 7.2 million pounds of other chemicals that are more toxic and persistent in the environment. Bt expressed in plants is much safer than organic broadcast Bt, sulfur, copper, or conventional synthetics. Bt and glyphosate resistant varieties make strip tillage, no- till, and reduced tillage practices, as well as crop rotation more viable and profitable. These practices improve soil conservation, require less fossil fuel use, reduce greenhouse gas production, and complement carbon sequestration efforts as opposed to tillage practices of organic and conventional agriculture. By using safer more precise chemicals combined with better genetics, crop yields are optimized disturbing less land and maintaining more diversity among both pest and non pest populations. The complementary relationship between reduced tillage, carbon sequestration, and the ability to produce carbon credits is certainly something to consider if we are to ever implement Kyoto style emissions standards.
--------------------------------------
Sources:
Agricultural Outlook ERS/USDA Aug 2000
Leonard, Roger, LSU Agricultural Center and Dr. Ronald Smith, Auburn University.
Nelson, Gerald C. “Genetically Modified Organisms in Agriculture: Economics and Politics.” San Diego Academic Press 2001. Preston, Christopher. “Peer Reviewed Publications on the Safety of GM Foods. Results of a search of the PubMed database for publications on feeding studies for GM crops.” Senior Lecturer in Weed Management,
Tuesday, April 24, 2007
Massachusetts v. EPA
Some are urging congress to pass legislation to reduce CO2 emissions by 80% by 2050. A first step could involve corporate average fuel economy (CAFE) standards. How many lives are worth how many tons of CO2 reduction? The National Academy of Sciences 2001 report on CAFE standards estimates that the lethal impact of CAFE related changes in automobile designs results in the loss of 1300-2600 lives per year. Ford's share of the blame for the Explorer/Firestone debacle can largely be linked to CAFE related factors. Amendments to the Clean Air Act brought us the poisonous oxygenate-groundwater pollutant MTBE. These are just some instances of what could result from an overzealous reaction.
Legislated CO2 reductions that slow economic growth would disproportionately affect low-income people. This legislation also has the potential to create ‘rent seeking’ opportunities for big business. Enron was a top corporate supporter for the adoption of the Kyoto Treaty because of the expected profits that would result. When California was developing regulations for reformulated gasoline, Unocal influenced the legislation to mirror some of its own refining patents.
Instead mandating the pollution of our groundwater with energy additives, increasing the fatality rate in automobile accidents, or creating profit opportunities for big business, perhaps a better approach for dealing with climate change or any environmental problem is to develop resilient market based economies that are able to invest in the technology necessary to adapt to ever changing resource constraints.
Monday, April 02, 2007
BIOTECH CROPS AND GREEN PRODUCTION
Bio-based enzymes and polymers derived from GM plants lower the amount of green house gasses emitted and release fewer toxic chemicals into the air and water. The resulting products are more durable and often biodegradable.
SOURCE: Farm Industry News Feb 1, 2007
Monday, March 19, 2007
TYPE II ERROR BIAS IN GOVERNMENT DECISION MAKING: THE CASE OF KATRINA*
Let’s say our government leader finds them self in the following predicament. After the destruction and the levees have broken someone has to make the decision to send in relief workers. However there are risks. Disease infested water, collapsing buildings and roads, roaming bandits, toxic chemical exposure etc. If our leader sends in workers and they meet a terrible fate, the consequences are on his shoulders. Later the media would hang him over sending our brave heroes in harms way.
Given limited information, here is the model in the context of hypothesis testing:
Ho: X= Xo ‘it is too harmful to send in relief ASAP’
Ha: X= Xa: ‘the harm is trivial, and justified to send in relief ASAP’
Type I Error: sending relief workers into unnecessary danger
If on the other hand, our government official decides to wait, until he has better information he could avoid this. The consequences may be the lives of hurricane victims, but the blame can be shared with nature.
Type II Error: Over cautiousness that prevents a quick response by relief authorities
In general this is one of the explanations given in the Public Choice article explaining the federal government’s response to Hurricane Katrina. It is also one of the reasons in general that many of our leaders at the federal, state, local, levels fail to make timely decisions or provide leadership when needed.
Thursday, March 15, 2007
TYPE II ERROR BIAS: THE FDA
Ho: X = Xo ‘drug is harmful’
Ha: X = Xa ‘drug is safe’
If the decision makers make the mistake of releasing a harmful drug, the consequences would be easily identifiable, and could be visibly traced to their decision. They would want to avoid this at all cost. In essence, they want to avoid making a type I error.
Type I Error: = releasing a harmful drug
From my previous discussion on hypothesis testing, we know that to decrease the probability of committing a type I error, we choose an alpha level that is lower. In a t-test, if we are really afraid of making a type I error, we might set alpha ( the significance level) at .05, .01, or to go overboard.001 etc.
As previously discussed, setting alpha lower and lower increases beta, or the probability of committing a type II error. Recall, a type II error is accepting a false Ho. In this case that would be equivalent to falsely concluding that the ‘drug is harmful’ when it could actually be released and improve the lives of millions.
Type II error bias = over precaution; setting alpha so low, or setting the standard of proof so high as to almost always reject Ho, and biasing the decision in such a way that the probability of a type two error (beta) is greatly increased.
As a result of type II error bias, many life improving drugs never make it to the market.
Wednesday, March 14, 2007
TRICKLEDOWN TAXES
http://bgdailynews.com/articles/2007/03/14/local_news/news/news3.txt
How much of the money in the county budget shortfall is related to illegal immigrants, or refugees that are brought into the county? If either of these are reasons contributing to our budget shortfall then we have a serious case of unfunded mandates.
First, is it not the job of the federal government to control immigration? Truly, illegal immigration is only a problem if it contributes to increased levels of crime strains both federal and local resources, in cases like we may have now with Warren County. If the federal government cannot resolve the illegal immigration problem, why should we have to pay for it locally?
Even with legal immigrants that are refugees, why should we have to pay for federal programs that are unconstitutional?
In 1794 Congress appropriated $15,000 for relief of French refugees. James Madison objected stating "I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents."
Have we amended the constitution since 1794 to allow for this? If this is something that the people of the United States would like to do, then I do not have as much of a problem with it. It is in fact a very charitable act. But, it must be done with our consent. In this case, expanding the role of government beyond the powers specifically enumerated in the constitution requires consent in the form of a constitutional amendment. That requires a vote of two-thirds of both the House of Representatives and the Senate, followed by a ratification of three-fourths of the state legislatures.
This may seem like a very drawn out process, but is was designed by our founders to ensure the ‘consent of the governed.’ According to economist Walter E. Williams of George Mason University, two-thirds of federal spending has by-passed these criteria for consent. It is what economist Thomas Sowell has coined ‘the quiet repeal of the American Revolution’ in his book ‘The Quest for Cosmic Justice.’
So now, we are paying higher taxes at the federal level without our consent. As a result of these federal programs and failure to secure our borders we are having resource problems at the local level. Is that why they are proposing a tax on insurance premiums? Is this a ‘trickle down’ effect? Are these ‘trickle down tax increases’?
Monday, March 12, 2007
TYPE I AND TYPE II ERRORS
The probability of rejecting the null hypothesis when it is true can be defined by:
Alpha = P (reject Ho X = Xo)
Rejecting the null hypothesis when it is actually true is referred to in statistics as a type I error. Therefore alpha is the probability of ‘committing’ a type 1 error. In a basic statistics, when you conduct a basic t- test ( i.e. reject Ho if t > t-critical) at the 5% level of significance, you are establishing a 5% chance of committing a type one error.
Of course, you may fail to reject Ho, or loosely speaking ‘accept’ Ho.
The probability of ‘accepting’ Ho when it is false can be defined by:
Beta = P (accept Ho X = Xa)
Speaking heuristically, accepting a false Ho is referred to as a type II error. Beta is therefore the probability of committing a type 2 error.
It turns out, that as you increase the significance level of a test ( by making alpha lower and decreasing the probability of a type I error), the probability of a type II error (beta) increases. This is the theoretical basis for ‘type II error bias.’