Former Iowa governor Tom Vilsack is the frontrunner for the post of Agriculture secretary in Barack Obama’s administration, Congressional Quarterly says in a report citing “people close to the presidential transition team.”
Vilsack is a powerful booster of “alternative energy,” which is not exactly surprising given that he comes from a powerful corn state. Obama himself voted for ethanol subsidies every chance he got during his couple of years in the Senate. Obama touted his support for biofuels in just about every debate with senator John McCain. When Republicans chanted “drill, drill, drill,” Obama and Vilsack were probably thinking “grow, grow, grow.”
But Vilsack may not be the corn, corn, corn politician he seems to be. In an interview with Larry Kudlow last year he signaled that he could be in favour of repealing sugar tariffs to allow Brazilian sugar-based ethanol into the US. So you may want to hold back on going ultra-long corn futures.
What seems certain, however, is that Vilsack will push hard for cap and trade carbon credit programs. These operate to redistribute wealth from more carbon fuel intensive businesses and areas to those with smaller carbon footprints. Under cap and trade, the government creates an artificial commodity—carbon credits—that businesses will have to pay for with real money. It’s more or less a zero sum wealth transfer since no actual wealth is created by capping carbon.
Here’s how Vilsack explained it in a recent newspaper column.
Iowa is leading the way in decarbonizing energy sources by diversifying farm fields into energy fields. Our investment in cellulosic ethanol, biofuel production plants and wind farms has resulted in economic, environmental and energy security.
Additionally, Iowa experienced a resurgence in the manufacturing base required to support this growing carbon-efficient economy. And the demand for research and development has propelled our universities to the epicentre of innovation. Iowa is becoming to agricultural technology what Silicon Valley is to computers.
This is a model that can and must work across the heartland.
Meanwhile, 1,000 miles away in New York, 10 states covering New England and the Mid-Atlantic came together on September 29 to form the Regional Greenhouse Gas Initiative. In short, RGGI creates a market similar to any other commodity exchange, except that it trades carbon credits, the same carbon credits that American farms can be producing.
In other words, by locking up carbon through clean technologies and generating less carbon through renewable energy sources, we create home-grown carbon credits direct from the family farm.
These credits then can be sold on the open market just as if they were soybeans or lean hogs. The result is the diversification of the average family farm portfolio, generating a new revenue stream and creating a new “cash crop” that just happens to help save the planet at the same time.
On a national level, job creation centered on a carbon-efficient economy and our quest for carbon productivity is estimated at upwards of 5 million new and better paying jobs. Under bold new leadership and with collaboration between state and federal governments, this transition can propel our economy, rather than hinder it.
Through innovation, we will preserve our heartland and ensure that our nation’s farmland is productive for generations to come. We must not fear a transition to a low-carbon future. We must embrace it.
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