How would you fix the economy and budget issues?

[Schneed10]

Originally Posted by NC_Skins

Hell yes get rid of this shit..lol

But isn't there a return on investment case to be made on this?

You can mix ethanol at up to 10% levels into gasoline and cars will still run fine. I haven't done the math, but the financial analyst in me says:

- You have a cash outlay of $6 Billion
- You have savings on gasoline of 10% x Gallons of Gas Sold at Pump x (Price of Gasoline per Gallon - Price of Ethanol per Gallon)

So the question becomes, without the Ethanol subsidy could we still realize the savings on the 10% of gasoline that's displaced by Ethanol?

I'm sure this is overly simplified, but somebody somewhere needs to do an ROI on this before recommending cutting the subsidy.

[NC_Skins]

Originally Posted by Schneed10

But isn't there a return on investment case to be made on this?

You can mix ethanol at up to 10% levels into gasoline and cars will still run fine. I haven't done the math, but the financial analyst in me says:

- You have a cash outlay of $6 Billion
- You have savings on gasoline of 10% x Gallons of Gas Sold at Pump x (Price of Gasoline per Gallon - Price of Ethanol per Gallon)

So the question becomes, without the Ethanol subsidy could we still realize the savings on the 10% of gasoline that's displaced by Ethanol?

I'm sure this is overly simplified, but somebody somewhere needs to do an ROI on this before recommending cutting the subsidy.

Not sure how.

In 1986 the U.S. Department of Agriculture estimated the average cost of producing ethanol at $l.60 a gallon, more than double the then wholesale gasoline price of 60 cents a gallon (the current wholesale price is roughly 55 cents).


Ethanol has done poorly on its own largely because it is a relatively lousy fuel. An Agriculture Department report observed,

Each gallon of ethanol contains about two-thirds as much energy as does gasoline, resulting in reduced fuel economy. One would expect vehicles using gasohol to show about a 3.3 percent reduction in miles per gallon since ethanol constitutes 10 percent of the ethanol-gasoline blend. In a recent report on the performance of alcohol-gasoine blends, the DOE concluded that gasohol-fueled vehicles averaged 4.7 percent fewer miles per gallon than gasoline-fueled vehicles in automobile fleets.(35)

The comparatively feeble fuel value of ethanol is a large part of the reason why the fuel is so discounted from its cost of production. The USDA report further noted,

Fuel ethanol sold for about $0.90 per gallon in July 1986. This price does not reflect its free market value because gasoline blenders qualify for Federal and State ethanol subsidies. After deducting the value of the subsidies ($0.60 per gallon for the Federal subsidy and some $0.30- $0.40 average for State subsidies) the net cost of ethanol to blenders is about zero. This indicates that ethanol producers could not survive without the subsidies, and suggests that most will need even larger subsidies to stay in business unless petroleum prices increase sharply. Net of applicable subsidies, ethanol is selling for about $0.30 per gallon less than the wholesale price of gasoline.(36)

Yet, while ethanol was selling (net of subsidies) for half the price of gasoline, it cost more than twice as much to produce as gasoline. Obviously, government intervention is necessary.

[Schneed10]

Originally Posted by NC_Skins

Not sure how.

Compelling case. As you can tell, I did not read it!

[firstdown]

Originally Posted by Schneed10

But isn't there a return on investment case to be made on this?

You can mix ethanol at up to 10% levels into gasoline and cars will still run fine. I haven't done the math, but the financial analyst in me says:

- You have a cash outlay of $6 Billion
- You have savings on gasoline of 10% x Gallons of Gas Sold at Pump x (Price of Gasoline per Gallon - Price of Ethanol per Gallon)

So the question becomes, without the Ethanol subsidy could we still realize the savings on the 10% of gasoline that's displaced by Ethanol?

I'm sure this is overly simplified, but somebody somewhere needs to do an ROI on this before recommending cutting the subsidy.

First off the 10% enthanol level in gas does cause cars not run as effecient as they should. On the marine side its been a nightmare and caused millions of damage to boats. Enthanol is also more expensive to produce then gas so it does not save money it cost money. Those weed wackers and gas blowers you have that seem to not run as good its probably because of E10.

[dmek25]

isnt the SS taxes capped at 109000 per year? that could be one change to increase the total revenue

[Schneed10]

Originally Posted by dmek25

isnt the SS taxes capped at 109000 per year? that could be one change to increase the total revenue

Yes. Or thereabouts. That's another one that's on the table.

This of course would only affect individuals making more than $100K per year.

[firstdown]

Originally Posted by dmek25

isnt the SS taxes capped at 109000 per year? that could be one change to increase the total revenue

They are capped around that number and there is talk about removing the cap to help fix the SS problem. Its just another way to not fix the real problem. Its what they do in congress. God forbid we fix SS with real solutions. Its a spending problem not a money problem.

[12thMan]

Schneed, there are many symptoms and causes to this fragile economy. It's like a sickly patient who comes into your office sneezing like crazy. The first thing the doctor wants to know if they're allergic to anything. If the answer is yes, he/she will keep diagnosing beyond the obvious before they prescribe medication. My basic premise is that the weakness of the housing market is the most glaring undermining confidence and recovery, not the only thing.

I wholeheartedly agree that the the rate of unemployment is linked to housing prices. I've mentioned this in at least one other thread around here. However, my point of contention with the Obama administration, as it relates to the foreclosure crisis, is that they've nursed the banks back to health, the auto industry is back on it's feet, yet they've left the middle class to endure the most brutal housing recession to hit this nation, perhaps ever.

You seem to lay much of the blame at the feet of the American consumer. Government can't solve all the problems, people need to save more, homes are expensive, etc. While all of your statements are true, it's also true that real wages have stagnated over the past 20 years while the cost of living continues to go up. The average American is working longer, retiring later, and the exorbitant cost of health care have driven many into bankruptcy, all while being barraged with ads selling the American dream and easy credit.

It's not that government can -- or should be expected to solve everything, but they should at least uphold their end of the bargain.

[Schneed10]

Originally Posted by 12thMan

You seem to lay much of the blame at the feet of the American consumer. Government can't solve all the problems, people need to save more, homes are expensive, etc. While all of your statements are true, it's also true that real wages have stagnated over the past 20 years while the cost of living continues to go up. The average American is working longer, retiring later, and the exorbitant cost of health care have driven many into bankruptcy, all while being barraged with ads selling the American dream and easy credit.

But WHY have real wages stagnated? It's not enough to just say they have, you have to understand why they've stagnated if you expect anyone to do anything about it. You can't prescribe medicine for the disease if you don't understand how it's attacking the body.

Globalization. That's the cause.

Real wages have stagnated because the American dream as we used to know it has evaporated. It used to be enough to graduate from high school and get a job at a factory. That could support the American family just fine. But companies have found ways to make many products for cheaper overseas largely because of lower wage rates in foreign countries. Companies shut down factories here and moved them to China. And now as India has become stronger from an education perspective, companies are finding they can eliminate American call centers and do it cheaper in India.

So when you have so many jobs headed overseas, and a growing population here in the states, you get a greater supply of workers. Natural market forces will of course prevent wages from growing.

Understanding that, what praytell do you ask of Obama or congress or anybody? What the hell can you do about it? China and India have cheaper labor, are you going to tell your American companies they can't ship jobs overseas to those countries? If you do, those American companies won't last long against competition that is allowed to tap into the cheaper labor pool.

Obama hasn't done anything about it because there is no answer. It's up to the people. You want to live the American dream, be better than your Chinese or Indian counterpart, because if you don't then they'll live the American dream. Work and deserve it, earn it to own it.

[firstdown]

I saw this and thought about this thread. We really don't unstand the cost to run our gov. and the cost to just fight rust was amazing.

The Pentagon Confronts New Enemy: Rust | Danger Room | Wired.com

[Slingin Sammy 33]

I don't know the details of the latest due to lots of work/family stuff going on but.......one thing I know I wouldn't do to try to fix the economy/budget is walk out of negotiations to work on the budget/defecit/debt ceiling. Maybe I'm just naive, but no one said this was going to be easy, and you can't get anything done if you're not talking.

[12thMan]

Here's a study on the effect ethanol production has on food prices, particularly the price of corn.

Opponents argue that it's disrupting to the food supply, which is true, and there's a direct link to the higher food prices. Proponents argue the opposite.

[firstdown]

Originally Posted by 12thMan

Here's a study on the effect ethanol production has on food prices, particularly the price of corn.

Opponents argue that it's disrupting to the food supply, which is true, and there's a direct link to the higher food prices. Proponents argue the opposite.

I've looked and it seems to be one study saying it does not affect food prices then there is one that says it does drive up food prices. I don't have a problem with using E10 in my car but it really sucks for boats. It does three things. If its an older boat the hoses cannot handle E10 and the hoses break down causing even bigger motor problems. The other problem is that E10 holds and attracts moistuer and cause issues there. It does not store very well and seperates causing issues for people who store their boats for the winter.

[firstdown]

Funny now the Dems are trying to say the Rep are sabotaging the economy for political gain. Thats funny because it was the right that said that 1 trillion Obama spent would not help and it looks like we were right. So I guess the only thing the Dems can try to do is blame the Rep.

[GMScud]

Originally Posted by firstdown

Funny now the Dems are trying to say the Rep are sabotaging the economy for political gain. Thats funny because it was the right that said that 1 trillion Obama spent would not help and it looks like we were right. So I guess the only thing the Dems can try to do is blame the Rep.

Greenspan concurs.

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