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Ethanol roots

Almost Daily some news item or commentary confirms just how far ethanol has entered our consciousness. The price of ethanol futures contracts in Chicago or news of mergers between ethanol processors truly qualifies as “business news” — that is, information important enough to be known by an informed general public. Likewise, critics of corn-based ethanol appear more exercised than ever before in pointing out the fuel's limitations (and thereby confirming its current importance). Perhaps one way to treat this daily sensory overload is to study just how an ethanol industry developed over the course of the last few decades.

Fortunately, a new book authored by Wendy Fernstrum provides an important sense of context. The book, entitled High Octane: How Minnesota Led the Nation in Ethanol Development, traces how ethanol production developed in one state. This may appear to be a somewhat narrow angle for a huge topic. The author, however, does an excellent job in relating how Minnesota both reflected and diverged from larger trends.

This is not some dry, statistic-laden tome. It is an engaging, well-written survey, filled with interesting people and politics. It is often a story of dashed hopes and personal tenacity. Fernstrum's central point is to explain the rise of a “Minnesota model” in ethanol production, in which growers created a system of farmer-owned ethanol-processing plants. This system moreover was not created during the first gasohol boom of the late 1970s and early 1980s. Instead, the Minnesota model took root at a time of relatively low petroleum prices during the 1990s.

What makes Fernstrum's work so engaging is how she traces the persistent efforts of a handful of true believers and organizations, like Minnesota Corn Growers, to keep ethanol-based fuels alive as an energy alternative. Some of this resulted from recruiting unlikely allies in environmental or public health sectors. More important, Fernstrum explains how ethanol supporters created and nurtured a bipartisan political consensus in favor of farmer-owned ethanol production. These political successes did not guarantee any individual's or cooperative's success, but they allowed an industry to survive hard times and gradually expand during better times.

At the end of the book, Fernstrum recognizes how much the ethanol industry has changed in the last few years. She speculates carefully that the factors that produced the Minnesota model may no longer hold. A system created within one state may not adapt to new circumstances — a victim paradoxically of the ethanol industry's growth and success nationally.

What therefore can be gleaned from this study? Perhaps more than anything Fernstrum demonstrates that all energy markets are inherently political and that politics in turn can be shaped by motivated individuals working together. Energy, like food, is too important to be left to market forces. Indeed what often looks like the operation of markets, like the price of a gallon of gasoline, is full of political decisions — both visible and hidden. This reality needs to inform the ongoing debate on the costs and benefits of biofuels. Farmers therefore will be involved not only as producers but also as citizens engaged in critical political debates.

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