Do you think its right for food crops to be made into fuel for inefficient cars?

The US government has subsidised the building of ethanol plants to convert basic foods into fuel for cars. This has quickly resulted in huge increases in the price of basic foods; 40% for wheat and 90% for soya, as crops are diverted. Meanwhile Europe imports palm oil for bio-fuels, resulting in deforestation in Asia to meet demand. So far we haven't even achieved 3% of transport fuel consumption, yet already we have seen food protests around the world and expert reports of increasing hardship in poor countries. At the same time, when we could choose efficient cars with low fuel consumption, we use inefficient cars which burn valuable fuel. Do you think this is morally defensible? What should be done right now?