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MAY 2004 |
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President
Supports Universal Broadband Access
In a recent letter to President Bush,
the National Grange expressed appreciation to the President for his efforts supporting
the deployment of universal, broadband technology access to all Americans by 2008.
Just like rural mail delivery and telephone access in the last century, broadband
access will play a critical role in allowing rural citizens to fully contribute
to and participate in American society. To meet this objective, the Grange urged
both the Bush Administration and the Federal Communications Commission (FCC) not
to appeal the March 2, 2004 federal court decision striking down part of the FCC
Triennial Review Order. Instead, they urged the president and Chairman Powell
to create new regulations under this order.
Since
passage of the Telecommunications Act of 1996, the FCC has struggled to adopt
regulatory programs that fully implement the facility-based competitive environment
that Congress carefully crafted into law. Unfortunately, special interests within
the telecommunications industry have fought to preserve the status quo by allowing
telecommunication companies to limit their services to the urban and suburban
markets considered to be the most lucrative. These actions have resulted in further
isolating already underserved areas by maintaining failing business and regulatory
models that interfere not only with deployment, but also technological innovation.
Because
the appeal would halt technological progress in already underserved communities,
the Grange believes that the FCC must cooperate with full implementation of the
1996 Telecommunications Act. The FCC's decision to exempt builders of new broadband
networks from having to share facilities with competitors was a step in the right
direction. By not appealing the court's decision, rural Americans can experience
the power of broadband in a way that stimulates economic growth, creates jobs,
and the goal of affordable broadband technology for all Americans by the year
2008 will be achieved.
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National Grange Joins New Coalition
The National Grange has joined
forces with leading senior, disability, minority, and consumer organizations to
form a new coalition, the Keep Universal Service Fair Coalition supporting the
nondiscriminatory Universal Service Fund (USF). Established by the federal government
to subsidize telephone service in low-income communities, the USF is a system
of collecting service fees that is based on the rate of consumer usage. The benefits
of USF were expanded to include rural communities in 1996. Despite
the benefit USF has provided to many communities, it is being threatened with
replacement by a connections-based system or a flat monthly connection charge.
This system would not only be detrimental to fixed and lower-income communities,
it would penalize low-volume users by forcing them to pay the same amount as high-volume
users. The
Keep Universal Service Fair Coalition is an alliance of national organizations
that support the current unbiased, competitively neutral revenue-based system.
For more information, please visit www.keepusffair.org.
top National
Grange Urges CMS to Implement New Medicare Law Fairly
A coalition of organizations
representing rural Americans, senior citizens, and disabled individuals with chronic
health conditions, recently sent a letter to Dr. Mark McClellan, Director of the
Centers for Medicare and Medicaid Services, requesting that the CMS implement
the new prescription drug benefit program fairly, to ensure that all Medicare
beneficiaries have access to prescription medications that produce optimal health
outcomes. "We recognize that the Centers for Medicare and Medicaid Services (CMS)
officials are confronting complex regulatory decisions to implement the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (PL 108-173)," the
letter stated. In particular the coalition letter raised concerns regarding the
implementation of the law, especially the development of drug formularies. Drug
formularies are government approved lists of prescription drugs that may be prescribed
for specific health conditions to individuals who will participate on the new
Medicare Prescription drug benefit that will take effect in 2006. Drug
formularies raise a number of critical issues to the 41 million Medicare beneficiaries
who will enroll in the Part D plans. Seniors and individuals with disabilities
need some assurance that the drug plans in which they have enrolled, will provide
them with access to prescription medications as intended by this important law. "We believe that beneficiaries should have some confidence that the drug plan
will cover the medication on which they depend," the letter stated. In addition,
the letter noted the importance of expedited review process to address plan decisions
regarding the drug formulary approved under Medicare Plan D programs.
"Your
agency faces complex decisions that will impact the success of the Medicare Prescription
Drug program," the letter stated. " We know of your commitment to devising a Medicare
prescription drug program that is consistent with the clinical practice guidelines,
developed by specialty organizations and experts in geriatric medicine, and support
the most appropriate drug therapies to meet the needs of this diverse population," the letter concluded.
top Millions
Travel At Least 50 Miles One-Way to Work
About 3.3 million Americans are "stretch commuters," traveling 50 miles or more one way to get to work each day,
according to National Household Travel Survey (NHTS) findings released by the
Bureau of Transportation Statistics (BTS) on May 12. These trips are made 329
million times per year. Among the 61.6 billion commutes to and/or from work each
year, nearly one out of 200 trips are stretch commutes. The
findings, America on the Go . Stretch Commuting, found that almost three out of
five stretch commuters are from a household with an annual income of at least
$50,000. Slightly more than two out of five households earn that much. Five out
of six stretch commuters are workers in manufacturing, construction, professional,
managerial or technical jobs. Most stretch commutes are rural and 81 percent are
50-99 miles in length one-way. Stretch commuters make 19 out of every 20 trips
in a personal vehicle like a car, truck or SUV, but when the distance is more
than 200 miles, one out of four such commutes changes to air travel. The
National Grange is working on passage of comprehensive Federal Highway Transportation
legislation as soon as possible. The existing federal highway program, known as
TEA 21, expires on June 30, 2004. Many Washington-insiders speculate that Congress
must complete work on new federal highway and transportation legislation by June
30, 2004 or Presidential election politics will force the term of any further
extension of the old TEA 21 program, beyond the November elections.
top Fertilizer
Costs and Imports Increase Substantially
One of the most important components
of modern agriculture is fertilizer. Natural gas price spikes have caused the
shutdown of 11 U.S. fertilizer plants in the past few years, according to industry
sources and federal studies, a dozen more plants could soon close if prices remain
high. Meanwhile, U.S. farmers are using more imported fertilizers, as foreign
producers gain a competitive edge from lower natural gas prices in foreign countries.
Fertilizer plants require large volumes of natural gas. To create anhydrous ammonia,
fertilizer manufacturers combine nitrogen from the air with hydrogen, which is
obtained from natural gas. One ton of anhydrous ammonia requires 33.5 million
British thermal units (MMBtu) of natural gas, according to the Fertilizer Institute.
So natural gas prices and fertilizer production costs are closely linked. Typically,
natural gas prices account for between 70 and 90 percent of fertilizer production
costs. With gas prices at $2.19 per MMBtu, the cost of making fertilizer runs
about $100 per ton. So when gas prices spiked to more than $10 per MMBtu in 2001,
many manufacturers shut down their factories rather than absorb those costs. Since
1998, U.S. ammonia production capacity has dropped 20 percent, from 20 million
tons to 16.3 million tons. Eleven fertilizer plants have been permanently closed,
resulting in the loss of several thousand jobs. At
the same time, foreign competitors with access to low-priced natural gas have
flooded the U.S. market and held down retail prices for fertilizer. According
to the General Accounting Office, which has studied energy costs within the fertilizer
industry, when gas prices hit $5 per MMBtu in the United States last year, Russia's
gas prices sat at a comparatively low 70 cents per MMBtu, while North African
prices were even lower at 40 cents per MMBtu.
Meanwhile,
farm groups, such as the National Grange, continue lobbying lawmakers to pass
comprehensive energy legislation. High natural gas prices are also affecting other
agricultural sectors. Many irrigation wells are powered by natural gas, therefore
farmers are being forced to cut costs elsewhere to make up for losses on irrigation.
In addition, natural gas is the second-highest cost outlay for making ethanol,
behind the cost of corn. Many ethanol plants are forecasting sharply declining
profits due to the rise in natural gas prices. In total, the US Department of
Agriculture estimates that natural gas cost farmers and ranchers $2.6 billion
more in 2003 than it did in 2002 to produce the same amount of food and fiber,
partially due to higher energy costs.
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Consumers Request Study on Future Natural Gas prices of
EPA Proposed Rule
In a recent letter to EPA Administrator Leavitt, a diverse
group of natural gas consumers, including the National Grange, urged the EPA to
implement the proposed Interstate Air Quality Rule and Mercury MACT regulations
in a manner that is "natural-gas-neutral". "We request a study be completed on
the impact of the proposed rules on the demand and price of natural gas under
Executive Order 13211, Actions Concerning Regulations That Significantly Affect
Energy Supply, Distribution ,or Use before the proposed regulations are put into
effect," the letter stated. "Consumers
have paid dearly as a result of the significant increased consumption of natural
gas for power generation by electric utilities, which have largely been driven
by government air quality regulations," the letter explains. According to the
Energy Information Administration, from 1992 to 2002, electric utility power generation
demand accounted for 93.6 percent of the nations' increase in natural gas demand. The letter further explained, "The 46 month natural gas crisis has cost homeowners,
farmers, and manufacturing more than $130 billion and there is no relief in sight.
This cost does not include the impact of higher electricity prices, lost economic
growth, and the loss of hundreds of thousands of manufacturing jobs. " "Natural
gas prices are high because of flat natural gas production and significant increased
use for power generation by electric utilities" the letter stated. Air regulations
had an important role in driving electric utilities to consume more and more natural
gas. "The electric utility industry has alternative energy sources to produce
power while homeowners, farmers, and manufacturing do not," The letter concluded. Joining
the National Grange in signing this letter were: 60Plus Association, Aluminum
Association, American Public Gas Association, Carpet and Rug Institute, the Fertilizer
Institute, National Lime Association, Louisiana Chemical Association, National
Corn Growers Association, Industrial Energy Consumers of America, American Farm
Bureau Federation, Arkansas Environmental Federation, Chlorine Chemistry Council,
Institute of Shortening and Edible Oils, American Iron and Steel Institute, Illinois
Industrial Energy Consumers, and American Soybean Association.
top Grange
Membership in Alaska on the Rise
The National Grange and the Alaska Grange
Council recently announced the official formation of the Alaska State Grange.
After a 70-year effort to recruit members, Alaska Granges are now present in Palmer,
Fairbanks, North Pole, Two Rivers, and Delta Junction. Granges in Alaska date
back to 1934 when the Northland Pioneer Grange No. 1 was organized in Palmer,
Alaska by colonists from the Midwest who relocated to the Matanuska Valley. Alaska
will be the 38th state to form a State Grange. The
newly founded Alaska State Grange adopted its state bylaws and voted on its state
officers at its annual state convention on May 17, 2004. The persistence of Alaskan
Grange members will afford their state the opportunity to vote at the National
Grange's 138th annual convention in Rochester, New York this November 2004. The
Alaska State Grange is expected to become actively involved in national legislative
issues as well as state issues facing rural Alaska. The Alaska State Grange will
advocate for the reorganization of the Ninth Circuit Court of Appeals, in favor
of organizing a Twelfth Circuit Court. The Alaskan State Grange argues that the
Ninth Circuit Court of Appeals is dominated by California and does not adequately
represent the beliefs of Alaskan citizens. The Alaska State Grange will also advocate
for reform legislation addressing problems with the No Child Left Behind Act,
the Patriot Act, and the Western Land Use Act. "For
more than 135 years, Grange communities across the nation have banded together
to speak with one, strong voice at local city halls and in state capitols, and
Washington, DC," National Grange President William Steel said. "Alaskan Grangers
will now make our voice stronger and louder as we continue to fight for legislation
in this country that will improve and enrich rural America."
top Prices
at the Pump Getting out of Hand
According to sources at the American Petroleum
Institute, gasoline prices have gone up because crude oil prices are higher, and
because gasoline markets are tight. Refiners are paying more for crude oil, the
principal cost component of a gallon of gasoline. A barrel of crude oil is selling
at more than $41 per barrel, $16 higher than this time last year. Crude
oil is traded on the international market place and is subject to the forces of
supply and demand worldwide. Supplies of crude oil are restricted while rapid
global economic expansion is fueling a surge in demand, especially in Asia due
to an increase in China's crude oil imports, up 36 percent from last year.
In a tight market even small changes have been known to have a dramatic impact
on prices. In addition political instability in oil-rich nations, such as Saudi
Arabia, Venezuela, and Iraq has added uncertainty in the marketplace, enhancing
the volatility of prices. The
US imports more than 62 percent of the crude and products consumed domestically,
requiring American oil companies to pay the world price. Because European inventories
are also low, European refiners are filling their own tanks first. Sales
of SUV's were up 18 percent last year, while car sales were down four percent.
According to the Department of Energy, gasoline demand is up four percent compared
to last year, despite the hike in gas prices.
In
addition to political factors affecting consumer confidence, it basically comes
down to the economic principle of supply and demand. When
demand is up- for gasoline as the US economy continues to grow, and supply is
down- as high freight rates, low European inventories, and new fuel specifications
have slowed imports - the result is high gasoline prices. As
a result of Grange policy the National Grange supports the following practices
to guard against supply uncertainty and unreasonable high prices:
- Retain
one billion barrels of US oil reserve while supplies are adequate
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Encourage greater use of natural resources, especially those that are renewable
and non-polluting. The National Grange opposes any further releases from the US
Strategic Oil Reserves for any purpose other than war or interruption of delivery
of foreign supplies of petroleum into the US.
The
Grange has supported and will continue to support comprehensive energy legislation
that is now held up in filibuster. The Grange supports a national energy policy
that will encourage the development of all forms domestic energy, both traditional
and alternative. The
National Grange has been working for the past two years to pass comprehensive
national energy legislation that would increase production of traditional energy
sources, increase funding for conservation, and increase production of alternative
energy sources.
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