Due to alternative fuel initiatives Indiana's Economy is heading towards growth

Indiana has always been a corn and soy bean state, with more and more environmental conciousness alternative fuels like ethanol are on the rise. Since Indiana is one of the leading producers of corn and soy bean it makes since to see economic growth due the recent gas prices.

While it is undisputed that recently the large increase in focus on ethanol has benefited the economy of Indiana. However this economic growth is both temporary and artificial and will, in the long run, hurt Indiana's economy.

The enormous increase in corn and soy beans being grown has been the result of the unique particularities in American politics. The President, congress, and state legislatures have been pouring billions of dollars into ethanol. This is because it is politically advantageous to do so. The ability to pander to farmers (an important constituency in any state) and appear "green" is an opportunity no politician can pass up. This is particularly powerful in presidential politics because any presidential race starts off with several months of pandering to Iowa. The best and easier way to do that is promise increased ethanol subsidies.

This is problematic because absent these subsidies, the bottom would completely fall out of the corn and soybean ethanol market. Ethanol is not a sustainable industry that can survive on its own. There are several reasons for this. First is that it takes more energy to make ethanol then you get from burning it. There is the gas it takes to run the machines that plant, maintain, and harvest the crops. There is the gas that is burned transporting all the corn from the ethanol refining plant and then all the energy that is taken up processing the corn or soybeans into ethanol. That means you actually burn more fossil fuels creating ethanol then you save by using it.

These two articles explain it better than I can.
http://www.nytimes.com...
http://www.cbsnews.com...

At the point where ethanol is not only not economically viable, but emits more pollution than it prevents, corn and soy ethanol are not viable industries. That means that as soon as political support for ethanol disappears, ethanol market will collapse, collapsing the economy of Indiana.

ill admit that indianas economy will become dependent on ethanol for about twenty years, but the short surplus of money will help indiana develope its basic industries. its obvious that indiana has an untapped supplie of natural resources, limestone hasn't been adequateky mined due to a lack of funds to get new mining instruments. corn its self is set to cost more to buy... good for indiana, sweet corn has become the delicacy of japan, making corn a international export. Indiana needs a small advance, ethanol, to set off other "dominoes" of indianas economic boom!

The dependence on corn and soy as the primary crop in Indiana will not lead to a development of other basic industries but only an increase in dependence on corn and soy. The increased revenue from the increase in corn subsidies goes into the pockets of family farmers or into the profit margins of large corporate farms. They money in no way goes to develop other industries.

In fact, as corn prices go up and subsidies go up, more and more land gets converted from other crops or other uses into ethanol corn farms. This means that Indiana is decreasing the diversity of the crops that are being farmed and only making itself more and more dependent on corn. As such, all this corn planting actually prevents Indiana from developing other industries or other crops (like sweet corn for eating) because all the land is being taken up by corn farming.

Moreover, the increased reliance on a single type of crop increases Indiana's vulnerability to disease, pests, changing weather, or natural disasters. A single disease or single unkind weather season or a single type of best could rip through Indiana, killing all the corn crops. A diversity of crops creates safety because all the different crops are vulnerable to different things, meaning if one crop fails because of not enough rain, crops which like dry conditions and would die if it rained too much survive. If there is only one main type of crop being planted, that makes Indiana's economy much more vulnerable because if that one crop fails for some reason, the whole economy of the state would fail.