The town of Columbus, Nebraska, bills itself as a "City of Power and

Progress." If Archer Daniels Midland gets its way, that power will be

partially generated by coal, one of the dirtiest forms of energy. When

burned, it emits carcinogenic pollutants and high levels of the

greenhouse gases linked to global warming.



Ironically this coal

will be used to generate ethanol, a plant-based petroleum substitute

that has been hyped by both environmentalists and President George Bush

as the green fuel of the future. The agribusiness giant Archer Daniels

Midland (ADM) is the largest U.S. producer of ethanol, which it makes

by distilling corn. ADM also operates coal-fired plants at its company

base in Decatur, Illinois, and Cedar Rapids, Iowa, and is currently

adding another coal-powered facility at its Clinton, Iowa ethanol plant.



That's

not all. "[Ethanol] plants themselves - not even the part producing the

energy - produce a lot of air pollution," says Mike Ewall, director of

the Energy Justice Network. "The EPA (U.S. Environmental Protection

Agency) has cracked down in recent years on a lot of Midwestern ethanol

plants for excessive levels of carbon monoxide, methanol, toluene, and

volatile organic compounds, some of which are known to cause cancer."



A

single ADM corn processing plant in Clinton, Iowa generated nearly

20,000 tons of pollutants including sulfur dioxide, nitrogen oxides,

and volatile organic compounds in 2004, according to federal records.

The EPA considers an ethanol plant as a "major source" of pollution if

it produces more than 100 tons of any one pollutant per year, although

it has recently proposed increasing that cap to 250 tons.



Sulfur

dioxide is classified by the EPA as a contributor to respiratory and

heart disease and the generation of acid rain. Nitrogen oxides produce

ozone and a wide variety of toxic chemicals as well as contributing to

global warming, according to the EPA, while many volatile organic

compounds are cancer-causing. Last year, Environmental Defense, a

national environmental group, ranked the Clinton plant as the 26th

largest emitter of carcinogenic compounds in the U.S.



For years,

ADM promoted itself as the "supermarket to the world" on major U.S.

radio and television networks like NPR, CBS, NBC, and PBS where it

underwrites influential programs such as the NewsHour with Jim Lehrer.

Now, as it actively promotes its ethanol business, ADM has rolled out

its new eco-friendly slogan, "Resourceful by Nature" which "reinforces

our role as an essential link between farmers and consumers."





Fueling Exploitation: ADM in Brazil and the Ivory Coast Greenpeace

International recently accused Archer Daniels Midland of funding, along

with two other agricultural commodities traders, much of the razing of

the Amazon rainforest for soy production. The group claims that that

ADM, along with Cargill and Bunge, are responsible for 60 percent of

the financing of soy production in the vital rainforest ecosystem. ADM

lends money to farmers who plant in areas of the rainforest that have

been illegally cleared, alleges Greenpeace, and then finances the

shipping of soy out of the region. ADM has set up four grain silos in

the Amazon, for the export of soy from Brazil. The primarily

destination of the soy is Europe where it ends up as high protein

cattle feed.



ADM is also currently being sued by the

International Labor Rights Fund for alleged involvement in the

trafficking, torture and forced labor of children who cultivate and

harvest cocoa beans in the Ivory Coast. The suit, which is being filed

on behalf of Malian children brought against their will to the Ivory

Coast, argues that the company, as well as Nestle and Cargill, has

knowingly turned a blind eye to the use of forced child labor in the

cocoa plantations where the agricultural processor's chocolate

originates.



"It is unconscionable that Nestle, ADM and Cargill

have ignored repeated and well-documented warnings over the past

several years that the farms they were using to grow cocoa employed

child slave labor," says International Labor Rights Fund attorney

Natacha Thys. "They could have put a stop to it years ago, but chose to

look the other way. We had to go to court as a last resort."



For more information:



Greenpeace's report "Eating Up the Amazon"



Human Rights Watchdog Sues Nestle, ADM, Cargill For Using Forced Child Labor





Despite

the company's attempts at green packaging, ADM is ranked as the tenth

worst corporate air polluter, on the "Toxic 100" list of the Political

Economy Research Institute at the University of Massachusetts. The

Department of Justice and the Environmental Protection Agency has

charged the company with violations of the Clean Air Act in hundreds of

processing units, covering 52 plants in 16 states. In 2003 the two

agencies reached a $351 million settlement with the company. Three

years earlier, ADM was fined $1.5 million by the Department of Justice

and $1.1 million by the State of Illinois for pollution related to

ethanol production and distribution. Currently, the corporation is

involved in approximately 25 administrative and judicial proceedings

connected to federal and state Superfund laws regarding the

environmental clean-up of sites contaminated by ADM operations.



Friends in High Places



Environmentalists

have cried foul, but they are up against the 56th largest company in

the United States, as ranked by revenue in Fortune Magazine. ADM has

more than 25,000 employees, net sales last year of $35.9 billion, with

$1 billion in profits, as well as a recent 29 percent profit increase

in the last quarter. The comany is a global force: ADM is one of the

world's biggest processors of soybeans, corn, wheat, and cocoa, which

it buys from growers in the U.S. and around the world. The company

recently hired Patricia A. Woertz, an executive vice president of

Chevron Corporation, as its chief executive officer.



ADM has

another resource at its disposal, the considerable clout it has built

up over decades of courting and lobbying Washington's power brokers.

Days after the company's February expansion announcement of the

coal-fired Nebraska plant, U.S. Energy Secretary Samuel W. Bodman

visited ADM's Decatur headquarters to tout its part in President Bush's

Biofuels Initiative. The secretary posed for photos with then ADM Chair

G. Allen Andreas and announced that the Department of Energy would

offer up to $160 million for the construction of three biorefineries to

expand U.S. ethanol production.



"Partnerships with industry like

these will lead to new innovation and discovery that will usher in an

era of reduced dependence on foreign sources of oil, while

strengthening our economy at home," Secretary Bodman said from ADM's

trade floor. Like the ADM ethanol plant in Columbus, the three

biorefineries could well be partially coal-powered, given the absence

of conditions imposed by the Department of Energy.



"It's been

some 30 years since we got a call from the White House asking for the

agricultural industry, ADM in particular, to take a serious look at the

possibilities of building facilities to produce alternative sources of

energy for our fuel supply in the United States," said Allen Andreas,

who was chair, chief executive and president of ADM at the time of

Secretary Bodman's visit. "We are delighted to participate in any way

that we can in the president's programs."



ADM and its signature

project have never lacked friends in high places, despite a history of

price fixing scandals and monopolistic misdeeds. The Andreas family,

which has headed up the publicly-traded company for decades, has

cultivated bipartisan support through generous donations to both

Republicans and Democrats. Since the 2000 election cycle, ADM has given

more than $3 million in political contributions, according to the

Center for Responsive Politics: $1.2 million to Democrats and $1.85

million to Republicans. These donations may have helped sustain a

multitude of government subsidies to ADM, including ethanol tax

credits, tariffs against foreign ethanol competitors, and federally

mandated ethanol additive standards.



Politicians from the

Midwestern Corn Belt are some of the company's staunchest allies.

Senators Richard Durbin, Charles Grassley, and Tom Harkin,

and Representative Dick Gephardt have consistently supported lavish

federal tax subsidies to ethanol producers, for which ADM is the

prime beneficiary. All are recipients of political action committee

donations from the agribusiness behemoth. The Wall Street Journal has

referred to the former South Dakota senator and Senate minority

leader as "Archer Daschle Midland," because of his unswerving support for

the interests of the company.



ADM's political heft was behind

the 54 cent per gallon tariff that the US government has imposed on

imports of sugar-cane based ethanol from Brazil, which is cheaper than

ADM's corn-based fuel. The tariff dates back to 1980 when the CEO of

ADM convinced President Carter to adopt it, according to former ADM

lobbyist Joseph Karth. Iowa's Senator Grassley recently stated his

intention to block any attempt to remove the tariff on lower-cost

Brazilian fuel in the face of rising gas prices, stating that "lifting

this tariff would be counter-productive to the widely supported goal of

promoting home-grown renewable sources of energy."



Over many

decades, the company has been the recipient of government largesse in

the form of federal and state corn and ethanol subsidies that have

totaled billions of dollars, prompting the libertarian Cato Institute to

declare ADM the biggest recipient of corporate welfare in the U.S. in

1995. ADM has been a prime beneficiary of the federal tax credit on

ethanol, which the refiner can apply to the tax it pays on corporate

income. First implemented in 1978, the tax credit currently stands at

51 cents per gallon of ethanol sold. The Government Accounting Office

estimates the subsidies to the ethanol industry from 1980-2000 at $11

billion. As the biggest ethanol producer in the US, ADM has received

the largest portion of the government's generosity.



Recent

legislation has further greased the tracks of the ethanol gravy train.

The Energy Policy Act of 2005's Renewable Fuel Standard stipulates that

gasoline sold in the US must include a certain percentage of ethanol or

biodiesel, starting at 4 billion gallons this year and rising to 7.5

billion gallons by 2012. ADM got another boost when the federal

government mandated that oil companies replace MTBE, a

cancer-causing gasoline additive, with ethanol. 45 states have

adopted policies to encourage the production and use of the fuel. ADM

has responded with plans to increase its output of ethanol by 42

percent over the next three years.



When Corn is King



Subsidies

and tax incentives might make public policy sense - even when they flow

into the coffers of a Fortune 500 company with mega-profits - but only if

corn ethanol delivers on the promise that its boosters claim: to

significantly cut greenhouse emissions, protect the environment, and slow

global warming.



Debate has raged for years over whether

ethanol made from corn generates more energy than the amount of fossil

fuel that is used to produce it. UC Berkeley's Alexander Farrell

recently co-authored a comprehensive study, published in Science, on

the energy and greenhouse gas output of various sources of ethanol. His

group found that corn ethanol reduces greenhouse gases by only 13

percent, which compares unfavorably with ethanol made from vegetable

cellulose such as switchgrass. "Our best guess," says Farrell, "is that

using corn ethanol today results in a modest decline of greenhouse gas

emissions."



Yet the enormous amounts of corn that ADM and other

ethanol processors buy from Midwestern farmers wreak damage on the

environment in a multiplicity of ways. Modern corn hybrids require more

nitrogen fertilizer, herbicides, and insecticides than any other crop,

while causing the most extensive erosion of top soil. Pesticide and

fertilizer runoff from the vast expanses of corn in the U.S. prairies

bleed into groundwater and rivers as far as the Gulf of Mexico. The

nitrogen runoff flowing into the Mississippi River has fostered a vast bloom

of dead algae in the Gulf that starves fish and other aquatic life of

oxygen.



To understand the hidden costs of corn-based ethanol

requires factoring in "the huge, monstrous costs of cleaning up

polluted water in the Mississippi River drainage basin and also trying

to remedy the negative effects of poisoning the Gulf of Mexico," says

Tad Patzek of the University of California's Civil and Environmental

Engineering department.



"These are not abstract environmental

effects," Patzek asserts, "these are effects that impact the drinking

water all over the Corn Belt, that impact also the poison that people

ingest when they eat their food, from the various pesticides and

herbicides." Corn farming substantially tops all crops in total

application of pesticides, according to the US Department of

Agriculture, and is the crop most likely to leach pesticides into

drinking water.



While banned by the European Union, atrazine is

the most heavily used herbicide in the United States - primarily applied

to cornfields - and the EPA rates it as the second most common pesticide

in drinking wells. The EPA has set maximum safe levels of atrazine in

drinking water at 3 parts per billion, but scientists with the U.S.

Geological Survey have found up to 224 parts per billion in Midwestern

streams and 2,300 parts per billion in Corn Belt irrigation reservoirs.



Then there is the question of how practical it is to replace petroleum

with corn-based ethanol. "There are conflicting figures on how much

land would be needed to meet all of our petroleum demand from ethanol,"

says Energy Justice Network's Ewall, "and those range from some portion

of what we currently have as available crop land to as much as five

times as the amount of crop land in the US." The Department of

Agriculture estimates that the Corn Belt has lost 90 percent of its

original wetlands, two thirds of which has taken place since draining for agriculture began mid-century.



"No one who's looked at this issue

[from an environmental perspective] talks about using corn kernels as

the only, or even major component, of the long term solution," counters

Nathanael Greene, senior policy analyst with the Natural Resources

Defense Council. "Everyone assumes we'll evolve the industry from its

current technology to the advanced technologies."



If that

happens, it will be a marked reversal of many decades of government

policy in support of Archer Daniels Midland - and the company may well

wonder what it's getting for its unceasingly ample gifts to both

political parties. But with the "full-throated support of the Bush

Administration," in the words of the Renewable Fuels Association, a

corn ethanol-dominated, ADM-led trade group, that day doesn't seem to be approaching any

time soon.



Sasha Lilley is a writer for CorpWatch and producer of the program Against the Grain on Pacifica Radio.





Listen to an interview with Sasha Lilley on CorpWatch Radio.

AMP Section Name: Energy