Originally, biofuel was about turning agricultural waste, stuff that wasn't going to be food for anything, into fuel. How did we go from that to making fuel out of corn? My best guess, and this is pure conjecture with no facts backing it, is that as soon as subsidies for making biofuel came into play, people went for the easiest and cheapest biofuel to make: taking food and processing it into fuel. For biofuel to be useful, it has to be made out of waste material, not out of food.
I was a bright-eyed optimist about the possibilities of biofuel, but it seems like people can manage to screw up even the best ideas.