"Local" is Greek for "Delicious"

I ran my first 5K race on Saturday in 28 minutes and 16 seconds. As a rookie, I felt great about my run. Saturday was also about the half-way point to a 10K I’m running in November and was a nice confirmation that I’m at least on some kind of decent track with my training.

My sister-in-law, Kristin, ran the race with me. She called a few hours after it was over, wondering if I wanted to go out and get the greasy lunch we had so painfully earned over the last 5 weeks. We hit the Waveland Café – vote Best Breakfast in the Des Moines CityView survey 5 years in a row. Previous breakfasting attempts had all ended with sad assessments of a line extending nearly to Omaha. But today we had seats at the counter within a few minutes. We read the menu for entertainment as we waited for our classic breakfast and turkey reuben.

It turns out the Waveland uses a local butcher for its meats, buys all its stuff locally. And why not? This is Iowa – there are animals fattening themselves incessantly and grain spewing forth all around us.

There is no reason to eat anything that’s traveled more than a few dozen miles. The menu also informed us that every dollar spent locally triggers $7.00 in additional local revenue. Our already delirious eating pleasure (it was good, people) was heightened even more by our $140 contribution to the local economy. Mmm – satisfying!

After our lunch, Kristin and I geeked out on the internet at my house for awhile, looking up information about charitable giving and the estate tax, discussing a future award-winning screenplay that she’s going to write, ruminating on the 2008 Presidential elections. It’s weird how life works like that, but my good friend Scott Bents (who also happens to be Masters student at Iowa State University AND a Biodiesel Coop partner) had emailed me an article about a study recently conducted at Iowa State University on the regional economic impacts of local ethanol plant ownership – there it was in my inbox!

The money we had just spent at the Waveland Café would likely be hitting the streets in a few hours as the waitress spent our tip on a six-pack of beer and some parmesan cheese. She would return home and pay her water bill, partially financing the NetFlix habit of a reclusive City employee. Does the money invested in ethanol plants multiply in the same way? That’s what the ISU researchers wanted to find out.

(Full disclosure: I have season tickets to ISU football. I am not an alumnus, but am married to one and I love the Cyclones. I try to be impartial when reviewing the work of their researchers. It’s easier when I connect them directly with running back Stevie Hicks. Go for the HOLE Stevie! Damn it!)

Right now, 27 ethanol plants are operating in Iowa, with 2 dozen more at some stage of the planning or implementation process. Completion of all these projects would increase ethanol production capacity from 1.3 billion gallons to 3.8 billion gallons per year. Each ethanol plant creates jobs directly, like any other manufacturing operation. The plant pays out wages to its workers and dividends to its investors. Farmers in the immediate area experience some increase in the price they get for corn or sorghum; transportation costs cause the premium to decrease as the corn plants get further from the ethanol plants. Eagerly approved subsidies at every level of government comprise the final piece of the cash infusion; current Federal subsidy is $0.51 per gallon of pure ethanol.

Economic benefits? Yes! But how, and to whom, does the bling accumulate? The answer is complicated; every time you change one variable the whole system shifts. I strained my eyes slowly over this dense work and was impressed with the questions they thought to ask: are the investors owner/operators or are they hands-off types? What are the chances that new income will stay in the area? Where in the world IS Carmen Sandiego? Assuming investors break down 50/50 between owners and lazy-butts and that Carmen Sandiego is probably at the Waveland Café, the results broke down like this:







(The graph looks funky because I am terrible at html. Get over it.)

So moving from 25% to 50% local ownership increases the regional economic impact by $7.5 million - 97.4%! Moving from 50% to 75% local ownership has a $7.8 million impact, 51.3%. I bet you can do the math for the one I have left out. It’s a lot. So, I guess, local ownership proves its mammoth awesomeness once again.

Before you start sending me hate mail about ethanol’s energy balance, farm subsidies and the food issue, just know that I’m not here to promote corn-based ethanol. Mostly, I just wanted to highlight one piece of what I think is the future of energy production: local ownership and control. From wind farms to solar power to, in farm country at least, grainy gas and diesel, there are clear possibilities for individuals to wrap at least one fist around the opaque energy industry – and to make solid, rural-living money doing it. And that gets me all excited. More local ownership discussions to come!