Natural Gas Price Shock

By James L. Martin

This Article Appeared In The Washington Times On Sunday, November 14, 2004

“Although America’s economy is revving up, the price of a little blue flame imperils our resurgence. As Federal Reserve Chairman Alan Greenspan has said, America is threatened by high natural gas prices. This menace not only endangers our economy, it is especially threatening to America’s seniors who are struggling to make ends meet. The time has come for our national leaders to take the necessary steps to moderate soaring natural gas prices.

We seniors employ a simple, straight-forward analysis of the things that touch our lives. Over our kitchen tables, we discuss the issues affecting our families, friends and the great nation we so dearly love. Most times, mere talk of the weather ‘trumps’ discussion of natural gas bills. Now however, that’s not true. Seniors’ are genuinely worried about high natural gas bills. We still invoke the weather — but nowadays it’s likely to be included in a prayer in the hope that we can delay touching the thermostat.

Many folks think that high natural gas prices are a concern during the winter. They are. High prices bite hard into fixed incomes — sometimes severely. But high natural gas prices are more than seasonal harbingers. They are a year-round concern. Seniors must make increasingly tough choices to apportion precious resources. “Kitchen table” talk now centers on balancing the costs of fuel, food, and pharmaceuticals. All are up. Sometimes, something has to give — sadly, with even occasionally fatal consequences.

The fact is that fuel, food, pharmaceuticals and natural gas are intrinsically linked — even if we’re not firing up our furnaces. Natural gas is essential to produce foods, medicines and a host of necessities. Natural gas powers much of our electric grid, warms our homes, and is likely even embedded in many of the utensils and TV trays that rest upon our kitchen tables.

The price of natural gas is up. The government’s Energy Information Administration’s forecasts a typical residence’s heating bill will hit $993 this winter. That’s 15% over last year’s average and up 65% from only three years ago. Seniors on fixed incomes must somehow stretch finite dollars to cover their increasingly costly basic needs. High natural gas prices are fueling price increases in electricity, propane, and many of the commodities Americans require.

Our leaders must address this problem now, for our nation and for the 46.5 million Americans who receive Social Security checks. The causes are clear. Increasing demand for natural gas and unreasonably constrained supplies have predictable effects on prices. They go up! Although Congress has tried to pass sweeping energy legislation, it appears unlikely to be enacted into law this year. Our leaders must not shy from a frank and honest discussion about natural gas. Ultimately, they must address both supply and demand, and the infrastructure that ensures natural gas can efficiently reach the consumers who need it.

To get a handle on high natural gas prices, all sides must come to America’s kitchen table and talk straight about moderating them. We can do more to conserve energy and diversify fuels. We can improve our infrastructure. We can also better access domestic gas reserves. The U.S. Secretary of Interior is working to do just that, and I applaud Gale Norton for her leadership. She is taking an important step in the right direction, but Congress can, and must, do much more — and Congress must do so quickly.

In the interim, Congress can take the necessary steps to protect America’s most vulnerable citizens from the crushing effects of high natural gas prices. The federal government can and must better-fund its Low Income Home Energy Assistance Program. Inflation has hobbled this program which helps qualified Americans shoulder their home energy costs. LIHEAP’s buying power has been eroded by nearly 60%. As a result, eight out of ten Americans who are eligible for this help are not reached. That error must also be rectified.

Even if Congress were to enact an energy bill this year, it must also specifically address the problems driving natural gas prices up when it reconvenes in early 2005. The Federal Reserve Chairman and America’s seniors are legitimately concerned about the effects of these escalating prices. Our nation’s use and movements of natural gas can be made more efficient, our access to natural gas can be improved, and our economy can recover further — if our leaders can promptly take steps that will rationalize these market prices and rekindle this little blue flame in the New Year.

Jim Martin is President of the 60 Plus Association, a national non-partisan senior citizen organization based in Arlington, VA. The author can be reached at 1600 Wilson Blvd, Suite 960, Arlington, VA 22209. The email address is JMartin@60plus.org60plus.orgfb5.b39.myftpupload.comfb5.b39.myftpupload.com