The rural side of trade and energy
Trade. Energy. Higher education. Legislation. They're not just big-city topics.
We were recently encouraged by the large part rural people and places play in the "big picture" after hearing panelists discuss these topics at the Greater North Dakota Chamber Policy Summit.
All are important, but two of the four — trade and energy — particularly relate to rural economies.
It's easy to think of trade as high-level, multimillion dollar deals between hot-shot executives. Sure, that's part of it. But not all.
Trade goes rural in export deals for agricultural and specialty products and products made by small manufacturers, and the option for small manufacturers to import cost-effective quality materials.
Export benefits are apparent — more viable markets make a huge difference to rural areas that depend on the success of local agriculture and small manufacturing. Dollars earned by those enterprises continue to benefit local communities through wages, purchases, taxation and donations to local schools, emergency services and charities.
What may not be immediately clear are the benefits of importing materials, especially with concerns about American jobs being lost to overseas workers.
Thomas Shorma of WCCO Belting Inc. in Wahpeton, N.D., population 7,830, made a solid case for his company's switch to imported textiles. Upon learning his company's textile vendor was near bankruptcy, Shorma began researching new sources for fabric used in the production process. He discovered there was none to be found in the U.S. — the industry had dried up.
What he did find was an overseas source that offered better quality at a lower price.
The viability of importing was brought home when Shorma's chief financial officer voiced concern about jobs moving out of the country. Shorma's response?
"You don't understand — if we don't, our jobs will be moving out of the U.S."
Without the imported fabric, WCCO would not have been able to continue producing its products, which would have led to downsizing — lost jobs, and a huge economic loss to the rural economy.
Rural plays a huge part in the energy industry. Coal mining and coal-fired power generation, hydroelectric power, oil and gas production and wind energy are essentially rural industries that bolster rural economies with jobs, tax revenue and dollars spent within local communities and areas.
The polarization of Congress and its inability to build bipartisan support of energy legislation is a huge concern. Legislators on both sides need to be willing to weigh both environmental and economic effects, as well as ensure that consumers have a reliable, affordable source of energy.
Brad Tollerson of Otter Tail Power, noted the tremendous volatility in the industry, which relies on a combination of fossil fuel and renewable generation to feed the power grid.
"The boundaries of North Dakota don't mean much when it comes to power production and sales," Tollerson said, explaining that power is not a local commodity, but is sold across state lines and over large regions.
A mix of resources are essential, with reliable generation from coal helping to balance sources that rely on variable factors, such as wind, solar and hydroelectric. Even so, use of fossil fuels is still being targeted by the Environmental Protection Agency and is a bone of contention in Congress.
Research is underway to develop new technologies for cleaner power production and cost-effective, reliable storage. John Di Donato of NextEra Energy Resources effectively captured the hopes and fears for the industry's future:
"We are looking at every stone to keep costs down," Di Donato said. "We're either going to be ready or we won't be in business anymore."