Ted Nordhaus and Michael Shellenberger spent most of their careers working for environmental groups as political strategists. Frustrated by the movement’s focus on pollution regulations rather than public investment in technology, they broke from the pack by writing a manifesto in 2004 called “The Death of Environmentalism: Global Warming Politics in a Post-Environmental World.” The piece argued that “issue group liberalism” was declining and that “the environmental community's narrow definition of its self-interest leads to a kind of policy literalism that undermines its power.”

A year later, after Robert F. Kennedy Jr. published an opinion piece in the New York Times arguing that wind power developers should not be allowed to install offshore wind turbines near the Kennedy family’s famous luxury compound at Hyannisport, on Cape Cod, Nordhaus and Shellenberger responded with a broadside published in the San Francisco Chronicle, which called Kennedy’s opposition to the wind farm an example of a “a worldview born among the privileged patricians of a generation for whom building mansions by the sea was indistinguishable from advocating for the preservation of national parks.”

In 2007 Houghton Mifflin published Break Through: From the Death of Environmentalism to the Politics of Possibility, which Time magazine called “prescient” and Wired said “could be the most important thing to happen to environmentalism since ‘Silent Spring.’”

In 2008, the two men published an article in the Harvard Law and Policy Review called “Fast, Clean, & Cheap.” The gist of their argument is this: making hydrocarbons more expensive is wrongheaded because it will inevitably spawn a backlash from consumers. The only way to create a long-term change in our energy infrastructure is to make alternative energy sources cheaper “through major investments in technology innovation and infrastructure.” Their solution: the governments of the world must “make large, long-term investments in technology innovation.” Later that year Time named the duo “Heroes of the Environment,” for their writings.

Nordhaus and Shellenberger now head the Breakthrough Institute, an Oakland-based non-profit which says that it is aimed at “creating a new progressive politics, one that is large, aspirational, and asset-based.”

Their break with conventional thinking has led to some vicious personal attacks from one of the Democrats’ leading operatives, Joe Romm, a blogger on climate issues. In May he said the two were on a “disinformation rampage.” In June, Romm claimed that they were “lying about Obama,” that they are publishing “deeply flawed analyses” of climate legislation, and that “they are no longer credible sources.”

In early November, Nordhaus and Shellenberger struck back with a series of blog posts on “Climate McCarthyism.” They also wrote a long analysis, “Apocalypse Fatigue,” of declining public belief in global warming for Yale Environment 360. And earlier this week they released a 200-page analysis of Asian dominance of clean tech, “Rising Tigers, Sleeping Giants.”

I interviewed the two via email with Nordhaus and Shellenberger divvying up the responses.

Michael Shellenberger and Ted Nordhaus of the Breakthrough Institute

RB: What motivated you guys to write the Climate McCarthyism series?

Ted: In the past we had only responded to Romm when he attacked us directly. The truth is that for months we kept trying to avoid the guy. We’d put out an analysis of climate legislation and instead of actually taking issue with the content Romm would attack us personally. We’d respond by saying things like, “No, we’re not global warming deniers or delayers,” duh. After he started going after reporters and others we started saying to ourselves, “Somebody really ought to stand up to that guy,” but nobody ever did. So when he went after Keith Kloor -- a guy we’ve never met but who was the editor of Audubon Magazine for eight years – and called him a “trash journalist,” we knew somebody had to say something. Romm was engaging in character assassination to intimidate the press corps, and it was starting to work.

RB: Your critics say that you guys like getting into these high-profile fights.

Michael: Funny, those critics, almost all of them prominent liberal green bloggers have had nothing to say over the last two years as Joe Romm made his name blatantly slandering our reputations and those of many others. Now that we are fighting back and calling out Romm’s tactics for what they are, McCarthyite, they claim we’re opportunists. The truth is they’ve been complicit in Romm’s McCarthyism and they know it.

RB: The series started by describing Romm’s use of McCarthyite like guilt-by-association and misrepresentation – you quote Romm calling Roger Pielke, Jr., one of your senior fellows, to the fictional murderer, the “talented Mr. Ripley.” But the third and fourth posts, “The Hyper-Partisan Mind,” and “The Headquarters,” put Romm in a wider context.

Ted: Romm is a particularly vitriolic manifestation of the hyper-partisanship of American political life. We pointed to evidence that America is more divided along partisan lines than it has been since the Civil War Reconstruction. Romm tries to pass himself off as an independent, nonpartisan expert. In fact, he is an employee of a highly partisan war room, the Center for American Progress, and he routinely compares liberals, greens and Democrats he disagrees with to Republicans.

Michael: On climate, most Democratic, green and liberal partisans have taken an apocalyptic view of global warming ever since the Gore movie in 2006, and they’ve insisted that the solution be just efficiency and renewables through emissions regulations. In response, most Republicans and conservatives dug in their heels even further, resisting any action whatsoever as harmful to the economy.

RB: In Part 4, “The Headquarters,” you say that the Center for American Progress, which was founded in 2003, is unlike other think tanks. You write, “While it maintains all the trappings of a think tank, its communications are done in service of the established Democratic agenda, and its research is done in service of its communications.” Is this part of the hyper-partisanship?

Ted: It is. CAP was founded by John Podesta, who was Clinton’s chief of staff during the culture wars of the late nineties. He saw up-close how effective the right-wing noise machine can be. His model for a new organization was based on Heritage Foundation, not Brookings, and the various right-wing publications and talk radio stations that serve to shape the public debate.

RB: So blogs are for the left what talk radio is to the right?

Michael: It’s not an exact comparison but they do play similar roles. Maybe liberals prefer blogs because they burnish the hyper-partisanship with a sheen of literacy. But at the end of the day they are doing the same thing – whipping up the base and demonizing the opposition. Anyone who challenges Democratic obeisance to cap and trade gets attacked by Romm. It’s unpleasant and scary. Most people would rather be quiet.

RB: Like kids scared of a bully.

Ted: Partisan politics can be very eighth grade in that way.

RB: The other factor you point to in Romm’s rise to prominence is the fragmentation of the media. How so?

Michael: We’re all faced with a huge amount of information every day. Few people have time to read it all, including reporters and policymakers. So we seek out people to filter the news for us. Liberals and Democrats over the last three years have been turning to Joe Romm. Every day he tells you what matters and what to think about in the world of climate politics. The New York Times Kristof brilliantly called this the “reassuring womb of an echo chamber.”

RB: In the past, I’ve voted almost exclusively for Democratic candidates. Now I consider myself a member of the Disgusted Party. How do you describe your own political leanings? Do you consider yourselves Democrats? Libertarians?

Ted: We’re both Democrats and liberals. Some highly partisan liberals and environmentalists have attacked us as libertarians or neo-liberals and it is laughable. We’re advocating massive and direct state intervention in the energy economy. Whatever you think about that idea, it is indicative of how simultaneously hyper-partisan, ideological, and incoherent the climate debate has become that liberals who disagree with us can only understand our view point as some combination of conservative, libertarian, or neo-liberal even as our views and proposed solutions are diametrically opposed to those ideologies. It’s just one more example of the ways in which the climate debate has been completely narrowed down to just two positions by both sides.

RB: You have clashed with the mainstream environmental groups on many issues. What do you see as the biggest problem facing big groups like the Sierra Club, Natural Resources Defense Council, and the Environmental Defense Fund?

Michael: The pollution paradigm and the politics of limits. They had success using pollution regulations like cap and trade to deal with far easier pollution problems like acid rain. Now they’re trying to solve a much bigger problem, global warming, with the same tools. It can’t work.

RB: Why? It can’t work because they can’t pass it through Congress or because it won’t work if it passes?

Ted: What they can pass through Congress can’t work. This is the problem of the “Gordian knot” that we describe in Fast, Clean, and Cheap. No political economy in the world has been willing to seriously raise energy prices sufficient to drive substantial emissions reductions and the U.S. Congress is not different. Until climate change advocates stop trying to implement solutions that are predicated on high carbon prices in a political economy that, if it does anything, is only going to establish low carbon prices, we will be stuck with the same basic problem.

RB: I was in Denver a few weeks ago. I met with an economist there who posed an interesting question: What’s your one big idea? His response to his own question was “full employment for everyone.” My response would probably be “cheap abundant energy – and in particular, electricity -- for everyone.” What’s your one big idea?

Michael: Make clean energy cheap.

RB: What is your position on nuclear power?

Ted: Our position has changed from radical opposition to qualified support. We need appropriate safeguards. But we are impressed by the technological improvements over the last 50 years, and think nuclear needs to both be a key power source for developing nations, and a way to displace coal in the developed world. We support the fuel bank mechanism and other key safeguards to prevent proliferation.

RB: What about peak oil?

Michael: We tend to think we’re probably peaking but that the decline will be slow and not catastrophic as the peak oilers imagine. Technological innovation has benefitted oil drilling, so they keep finding new reserves in harder-to-reach places.

RB: Cap-and-trade or carbon tax?

Michael: We are agnostic in theory. If we are going to price carbon through cap and trade, then we need to auctioning pollution allowances to polluting firms instead of giving them away and we need to accept that there are going to be strict cost caps on the auction price, $5 or $10 per ton, increasingly gradually every year. But more importantly, whatever the pricing mechanism, we need to spend all of the money on R&D, demonstration and deployment. No offsets and no free allocations of allowances. That way you can raise the $30 to $60 billion a year we need to invest in clean energy RD&D with a low carbon price and you can spent the money directly on deploying low-carbon energy. This will drive much faster and more dramatic decline in emissions than we will if we pass Waxman Markey or similar proposals.

RB: What about the Pickens Plan?

Ted: What was exciting about the Pickens plan is that it was a plan. It was an actual industrial policy, an idea that still strikes terror in the hearts of most politicians because it would mean that the government is picking winners and losers. Pickens wanted the government to pick his technologies – natural gas and wind – and those are good energy sources as far as they go. So Pickens should be commended for his initiative but we would need a broader strategy than that.

RB: Recent estimates from a number of sources show that US gas resources, as well as global gas resources, are enormous. Do you favor increased use of natural gas as a lower-carbon alternative to coal? Regardless of your position, why can’t natural gas gain any traction in the current policy debate?

Ted: The concern with natural gas is that you invest in a huge expansion of natural gas infrastructure, and you do get emissions from that, but if you are going to virtually eliminate carbon emissions from our energy economy over the next couple of decades you have a problem in that you are making huge investments in a natural gas infrastructure that you are going to have to dismantle in short order. But that is really irrelevant to the current climate debate because what we have proposed in the name of doing something about climate change is a bill that will actually lock in coal for the next several decades because coal companies, most notably Duke energy, were quicker to take control of the cap and trade framework through the U.S. Climate Action Partnership than natural gas companies were.

RB: Most environmental groups believe energy should be made more expensive, through taxation or other mechanisms. My take is that such plans are unfair because they will have a disproportionate impact on the poor and the working class. Furthermore, those policy stances appear to legitimate the claims about “limousine liberals” who don’t understand why their politics may be seen as elitist. Do you see a conflict here? If so, how can it be addressed in an equitable way?

Ted: We think it’s important that it not be free to pollute. We require people to buy all sorts of permits and licenses to do things that have a social or environmental cost. The fact that they are heavier burdens on the poor isn’t necessarily a reason to oppose those things, but it is a reason to explicitly contain the cost of the permits. Our view is that, at least for the first few decades, the carbon price will never rise high enough to really drive innovation. That’s why the most important thing is spending the revenue generated from selling pollution permits on low-carbon power technologies.

RB: In March, I did an interview with Roger Pielke Jr. One of the points that he makes is that adaptation is largely being overlooked in the discussion of global warming. What’s your take on adaptation? Why isn’t that theme a larger component of the current discussion in Washington?

Michael: We have been advocates of preparedness and adaptation since 2004. We wrote about it “Death of Environmentalism.” The problem with the United Nations discussions of adaptation is that they are framed entirely around wealthy countries sending billions every year to poorer countries to adapt. Not likely to happen.

RB: You advocate bigger government-sponsored investments in renewable energy. Why should those investments be made by the government? The potential payoffs for a company that develops a high-density battery technology or other energy storage technique are enormous. Why can’t the private sector be trusted to do this work?

Ted: The energy sector is massively under-investing in R&D compared to the national average for several reasons. First, few have any economic reason at this point to move away from fossil fuels, which are incredibly cheap and profitable sources of power. Second, energy technology innovations are fairly easy to reverse-engineer, and unlike pharmaceutical drugs and media, patent protection is weak. This makes firms unwilling to spend much on R&D. Third, energy technologies are expensive. You can start Google in your garage for a few million, but new power plants cost on the order of $5 billion. It’s not an industry that lends itself to start-ups.

Michael: And even Google got money from the federal government. Indeed, if Americans had held the libertarian resistance to state funding of new infrastructure and technology, we would not have built the railroads, the highways, or the Internet, nor would we have cheap and abundant food, radios, many pharamaceutical drugs, jet airplanes, computers – the list goes on and on.

RB: In “Rising Tigers, Sleeping Giant,” you argue that China, Japan, and South Korea are about to eat our lunch on all the major low-carbon technologies, including nuclear, because their governments are poised to spend three times more on infrastructure and technology than we are. What do you say to those who argue that you’re looking at the wrong metric? America is still the global leader in R&D and home to most of the venture capital.

Ted: Yes, but look at where things are headed. For the first time in 2008, China attracted more private sector investment money than the U.S. Contrary to the neoclassical mythology, government investment in infrastructure and technology for new firms doesn’t “crowd out” the private sector, rather it crowds them in. What you’re seeing in all three Asia countries is a deliberate effort by governments to establish a first mover advantage over the U.S. through regional clusters of manufacturing, suppliers, universities, R&D labs – just like Silicon Valley.

RB: In “Apocalypse Fatigue” you attribute the decline in public belief in global warming to climate alarmism. But isn’t it really a result of the public rejecting the Democratic cap and trade proposal?

Ted: Yes, that’s probably part of it. There’s a lot of things happening at once so it’s definitely multi-factoral. I think you put together the fact that global warming remains a very low priority for people with the apocalyptic Gore rhetoric that “we have to change the way we live our lives” and you get voters rejecting mainstream climate science. In other words, greens have convinced many Americans that if global warming is happening, then we have to change the way we live our lives. In that formulation, they’ve decided global warming isn’t happening.

RB: Many people on the Green/Left have embraced Amory Lovins as their guru. What is your take on his work? What about the claim that energy efficiency alone is the cure to our energy needs?

Michael: We were both raised on the milk of Lovins but have become increasingly skeptical of the claims he and his former employee Joe Romm made about efficiency. If efficiency is so cheap, quick, and easy, then how come we aren’t doing more of it? I don’t think the answer is mass irrationality on the part of firms and homeowners. There’s something else going on.

RB: What is Breakthrough’s budget and who are your biggest funders?

Michael: We hope to have a budget of $1 million in 2010. Our funders are the Nathan Cummings Foundation, the Lotus Foundation, and the Open Society Institute. All are liberal and environmentalist foundations.

RB: How and why is the Breakthrough Institute different? And how do you avoid the same traps that you say are afflicting the larger environmental groups?

Ted: We’re different in that we’re trying to change the whole paradigm around climate and energy and other issues. This year we’re taking on national security, wanting to bring the same kind of close quantitative analysis of the terrorist threat and effective responses to it that we brought to climate and energy. I’m not sure how to avoid the same traps that affect the big green groups. If we succeed in shifting the paradigm from a politics of limits to a politics of possibility, then 30 or 40 years from now maybe some young bucks will have to overthrow our paradigm.