What you all don't realize is that with the much higher octane of ethanol vs. gasoline, engines can be designed with much higher compression, creating not only more power, but more efficiency. So yes, the ethanol contains less btus than gasoline, but if an engine is built for the fuel, you are only losing slight amounts of mileage. In the neighborhood of 5% for comparable displacement and flow efficiency.
I definitely agree that there are better sources of ethanol than corn, but it's our abundant resource right now, and if you can't spur interest in the product, it's hard for large corporations to fund the improvement into better technologies, such as manure, algae, etc.
I say use it and embrace it. The technology may not be where we want it to be, but computers weren't either once. Now look at where we have come with them. Fossil fuel is dying as a resource for the US, and our options are electric cars, or gaining freedom from our attachments to foreign oil with other fuels. I personally don't really like the idea of never being able to take a road trip again without stopping overnight to recharge every hundred miles.
That and the fun part is that Ethanol is race gas on the cheap. I'll be running 30psi+ of boost into my car this year on it, and only about half that would be possible on gasoline without blowing a large portion of the power out the tail pipe and heating my entire exhaust up to almost melting temperature.
they're researching many different ways including this http://www.technologyreview.com/biztech/20056 /?a=f
