A special three-part series in last week's San Jose Mercury News, entitled "The Cleantech Revolution," highlighted the enormous economic opportunity in the clean-tech sector and warned that the U.S. is quickly falling behind while Asia seeks to gain global market dominance.

In its analysis of the clean technology market, the Mercury's rhetoric is grand and its data convincing. The first part of the series begins:

"Cleantech is poised to be the valley's third great wave of innovation -- not just the next big thing, but perhaps the biggest thing ever. Confronting the peril of greenhouse gases and climate change happens to be a multi-trillion-dollar business opportunity."

"When it comes to cleantech, we have the largest market opportunity in the history of the planet driven by global climate change, resource constraints and energy independence," said Dallas Kachan, managing director of Cleantech Group. "Silicon Valley is critical to this revolution, but it does not occupy the throne it once did."

"Energy is the biggest opportunity Silicon Valley has ever seen," declared T.J. Rodgers, the founder of Cypress Semiconductor and chairman of SunPower, a leading maker of photovoltaic panels to produce solar energy.

So with all this venture-capital flowing in, the American cleantech industry must be in good position, right? Wrong. The Mercury makes a strong appeal for the alarm bells to start going off in Washington about the state of American competitiveness.The report declares:

"In other tech revolutions of recent decades, Silicon Valley became the uncontested global leader. The region's ability to innovate its way to the top in cleantech, though, is far from guaranteed. Competition is fierce and global, with trillions of dollars at stake."

For one thing, the American education system isn't doing the clean energy revolution any favors, as noted venture capitalist Vinod Khosla observes:

"We (in Silicon Valley) don't have a natural advantage in talent -- like chemical engineers, fermentation experts, engine designers and physicists."

Like several other sources -- including "Rising Tigers, Sleeping Giant," the first comprehensive comparison of Asian vs. U.S. clean-tech competitiveness -- this report outlines the extensive foreign investment in clean-energy, particularly in China. Pointing to annual investment in excess of $100 billion, renewable energy requirements, and tax incentives, the Mercury shows how China has already overtaken the lead in key markets such as solar. Once again, testimony backs the evidence, starting with a prominently supported letter to Energy Secretary Steven Chu.

A group of valley tech executives, including former Intel CEO Andy Grove, recently sent a letter to Chu urging the energy secretary to "sound the alarm bell to make America aware -- clearly and unequivocally -- of how rapidly other nations, particularly China, are moving on clean energy.

"Unless we move quickly and commit substantial resources on a sustained basis, we risk becoming an energy also-ran, and risk developing a new dependency," said the letter

"Unless there's a dramatic shift in national policy in the United States, the road to success in cleantech most likely goes through Beijing," said Matthew Lewis, spokesman for the San Francisco office of ClimateWorks Foundation, an international philanthropic network that promotes clean energy. "From a policy perspective, they are doing everything right."

Every aspect of cleantech "needs new science," said Kevin Surace, CEO of Serious Materials.

This prospect need not be seen entirely as a threat as Peggy Liu, founder of the Joint US-China Collaboration on Clean Energy, sees it: "I'm afraid people are setting up China as the enemy," she said. "You need to treat China like a partner."

Liu is probably right: clean-energy development is not a zero-sum game and US-China cooperation could benefit from the competitive advantages in both countries.

But the way it stands right now, the United States is standing still while other countries take advantage of "not just the next big thing, but perhaps the biggest thing ever."

Yale just released the latest iteration of their "Climate Change and the American Mind" tracking polls. Once again (this has been a consistent finding), the poll shows funding for more research on renewable energy is the most popular policy response to climate change across all respondents, netting 85% support.

• Funding more research on renewable energy, such as solar and wind power (85 percent)
• Tax rebates for people buying fuel-efficient vehicles or solar panels (82 percent)
• Establishing programs to teach Americans how to save energy (72 percent)
• Regulating carbon dioxide as a pollutant (71 percent)
• School curricula to teach children about the causes, consequences, and potential solutions to global warming (70 percent)
• Signing an international treaty that requires the U.S. to cut emissions of carbon dioxide 90% by the year 2050 (61 percent)
• Establishing programs to teach Americans about global warming (60 percent).
• Cap and trade (58 percent)

Click image to enlarge

Guess we'll keep on fighting the good fight. Have a great weekend!

If you guessed, "a drinking game," you'd certainly be correct, but if you also guessed, "more twists and turns than your small intestine" you'd be right on the mark.

Obama's address was not the stuff of Clinton-era small ball that we, and others, expected. That left Nancy Pelosi's exuberant clapping to be one of the most reliably predictable aspects of the evening (and happily, gave everyone playing at home a reason to drink).

In fact, Obama came out swinging, re-emphasizing critical priorities - health care reform, financial reform, climate/energy, and competitiveness - while detailing his added focus for the coming year, which will in large part involve curbing the growing deficit, or at least symbolic efforts on that front.

The Administration dropped the President's 2011 budget this week, announcing the expected three-year spending freeze on, well, all the spending that doesn't actually contribute much to the deficit. With two wars and entitlement programs in need of reform, even a spending ice age wouldn't hack it if we neglect to address these two factors.

In reality, there's really only one three-pronged route out of the deficit trap: real entitlement reform, responsible disengagement from Iraq and Afghanistan, and the re-ignition of America's engines of economic growth.

Luckily, Obama's 2011 budget doesn't freeze investment in innovation and funding for basic science, clean energy R&D, and energy education are all upped in the 2011 request, raising some hope for a happy clean tech ending.

Of course, it'll take more than an incremental bump in DOE research budgets to win the clean energy race. Thanks to the deluge of stories on Red China's green dominance - including one by ITIF President Rob Atkinson - there's no need for tea leaves and sorcery to understand what America needs if the President really has his eye on first prize. Jesse Jenkins may have said it best as he Skyped (yes, it's a verb) with Diane Sawyer (yes, she knows how to use Skype): "We need a national strategy for clean energy competitiveness."

If all the SOTU surprises weren't spicy enough, Obama left more jaws hanging last week by joining the GOP for a House luncheon that was more reminiscent of a school-yard game of dodgeball than a political gathering. If it were a game of dodgeball, however, Obama would have been the last guy standing who, with a surge of adrenaline, catches everything that's thrown at him, disqualifying all his opponents. Or as John Stewart aptly put it, "It was awesome." (emphasis assumed)

See for yourself here or see John Stewart's condensed version below.

Obama's willingness to publicly take on the barrage of Republican/Fox News talking points that stymied most legislative progress in 2009 proved to be a wild plot twist in a Democratic narrative that was starting to evoke panic.

But in case you were starting to feel a bit of catharsis and maybe just a flicker of confidence, the Obama administration began sending mixed signals about the future of climate and energy legislation in the Senate. With some news outlets reporting that Obama has lost all hope in cap and trade, Greens cringed as eyes turned to the possibility of an energy-only bill.

Meanwhile others reported that Obama had been misinterpreted and he was actually calling for Senate Dems to buck up and fight for a cap and trade policy that is still no closer to 60 votes than it was yesterday, or ever?

Perhaps the cap and trade conundrum is an attempt at a cliff-hanger ending that'll make sure we stay tuned for the next "Lost" Rose Garden Speech.

The writers of "Lost" couldn't make this stuff up.

Bruno Latour

Bruno Latour is a founder of science and technology studies (STS) and was listed as the 10th most-cited intellectual in the humanities and social sciences by The Times Higher Education Guide. His 1979 "Laboratory Life" was a watershed ethnography of how science works in the real world. Latour studied scientists and found that subjective judgments that look unscientific to outsiders are central to the scientific enterprise. In his most famous work, "We Have Never Been Modern," Latour's argues that modernity is a kind of faith characterized by efforts to purify concepts like nature and science even as they become invariably mixed up in politics, society, religion, and tradition.

Daniel Sarewitz

The question of science's potential, or lack thereof, to guide human decision-making and politics is also the focus of the work of 2010 Breakthrough Senior Fellow Dan Sarewitz, a columnist for Nature and a professor at Arizona State University. Sarewitz argues that people want science to play a policymaking role it cannot play because of high levels of uncertainty but, paradoxically, uncertainty should be the basis for action. For example, he writes, uncertainty was the best thing ever to happen for earthquake science, which "has moved away from prediction and towards the assessment, communication and reduction of vulnerabilities" -- a strategy very different from the dominant climate policy agenda, which imagines science can determine emissions limits and motivate the political action to enforce them.

Ulrich Beck

How wealthy nations manage risks like climate change has been the life-long work of one of Germany's leading sociologists, Ulrich Beck, author of the landmark "Risk Society." Beck has argued that as societies like Europe and the U.S. get richer and more developed they change their relationship to modern institutions like the nation. Beck calls these "second modern" societies because they are becoming more modern, not leaving modernity behind. On the one hand this can be positive and Beck writes of the need for a new global cosmopolitanism, but it can also create contradictions, with second modern individuals feeling little desire to make the kinds of investments nation states have traditionally made in infrastructure and technology to create prosperity and development.

If societies and governments are to make good choices about moving to non-fossil technologies to power civilization, they will need to hear from experts with not only technical knowledge but also knowledge of social systems, the economy, and politics. Breakthrough's current team of energy and climate experts -- David Douglas (Sun) Marty Hoffert (NYU), Roger Pielke, Jr. (CU), Frank Laird (DU) -- will be joined by 2010 Breakthrough Senior Fellows Bill Weihl, Greg Nemet, and Chris Green, all leading clean energy thinkers.

Bill Weihl

Weihl oversees Google's "Renewable Energy Cheaper Than Coal" (RE<C for short) program, which has identified the large technology gap, and thus price gap, between renewables and coal as the central obstacle in the way of reducing emissions globally. Weihl, who won Time magazine 2009 Hero of the Environment, oversees
Google's more than $45 million in direct investments in clean energy companies and is outspoken on the need for the federal government to invest orders of magnitude more in everything from solar to nuclear technologies, telling the New York Times:

"Putting a price on carbon can help level the playing field, but to actually deploy renewables to the extent that we stop burning coal, I believe that's only going to happen if they can compete economically without any substantial price on carbon or substantial subsidies, because I don't think that people will tolerate that. I hope they will; I would be willing to pay that extra cost, but I can afford it. There are lots of people in the developing world who probably would say, I'm not going to pay that."

Christopher Green

Overcoming the energy technology gap between energy-dense, abundant and cheap fossil fuels and inefficient, high-tech, and expensive clean power sources has been the focus of the work of economist Chris Green of McGill University for nearly twenty years. The leading British science journal Nature chose research by Green and his colleague Isabel Galiana on how to accelerate low-carbon technological development to feature the week before Copenhagen climate talks last December.

The Copenhagen Consensus on Climate, a panel of leading economists, recently ranked investments in technology funded by a low, slowly rising carbon price one of the top policy solutions to climate change in the world. Green's work has also shown that while energy efficiency improvement measures are important in slowing the growth of energy consumption, globally, overall energy consumption will continue to grow along with carbon emissions unless there is an energy technology revolution in low-carbon energies.

Greg Nemet

The question of what specifically has reduced the price of low-carbon energy in the past has been a focus of the work done by Greg Nemet, Assistant Professor at the University of Wisconsin in the La Follette School of Public Affairs and the Nelson Institute for Environmental Studies. Nemet has identified the key factors driving performance improvements and cost reductions in clean energy technologies: R&D, knowledge spillovers, and learning-by-doing through market experience. The lesson is that some deployment policies are more effective than others. Research and development must be integrated into deployment and procurement, not separate from it, and consistent with the overarching goal of tech improvement to make clean energy cheap, not simply more and more deployment. Therefore, we should not only increased state funding for renewables, we should also be using it in smarter ways.

]]> http://thebreakthrough.org/blog/2010/02/2010_breakthrough_senior_fello.shtml http://thebreakthrough.org/blog/2010/02/2010_breakthrough_senior_fello.shtml Senior Fellows Wed, 03 Feb 2010 10:16:48 -0800 Originally published by The Stanford Daily

One of the most powerful moments during last week's State of the Union came when President Obama warned that while Washington stalls, other nations are moving quickly to dominate the global clean-energy industry.

"China is not waiting to revamp its economy," Obama declared. "These nations aren't playing for second place... They're making serious investments in clean energy because they want those jobs. Well, I do not accept second place for the United States of America... The nation that leads the clean-energy economy will be the nation that leads the global economy. And America must be that nation."

Obama is right, and as always, his words were eloquent. Now his administration must get to work and advance a real strategy for global energy leadership.

The current proposals under consideration in Congress are far too weak. China, Japan and South Korea are launching massive, comprehensive clean-energy projects, investing a combined total of around $500 billion over the next five years. In contrast, the House-passed American Clean Energy & Security Act (ACESA), combined with the 2009 economic recovery package, poises the U.S. government to invest only $172 billion in this industry over the next five years, according to a recent report I co-authored with the Breakthrough Institute and Information Technology & Innovation Foundation.

That is hardly an effective strategy for energy leadership, and advocates should be careful about labeling the House and Senate climate bills as comprehensive solutions for U.S. clean-tech competitiveness.

A large and growing body of technology experts agree. In recent congressional testimony, Secretary of Energy Steven Chu stated, "I am concerned that we have not adequately focused on the importance of research and development of new energy technologies."

Senator Jeff Bingaman (D-N.M.), Chairman of the Senate Energy & Commerce Committee, recently said, "It is troubling that current legislative proposals before Congress to address climate change give relatively low emphasis to providing funding for the needed science and technology."

And in a recent public broadcast on energy and climate policy, Bill Gates wrote, "I looked at Waxman Markey [cap and trade climate legislation] and the research thing was miniscule."

Indeed, these proposals contain dangerously low levels of support for technology development. ACESA would only invest $1 to $1.5 billion per year in clean energy R&D, on top of the current federal energy R&D budget of around $4 billion per year (only a portion is for renewable energy). Meanwhile, the National Institutes of Health receives $30 billion in federal R&D, while the Department of Defense receives a whopping $85 billion.

Now is a critical moment. Copenhagen came and went with few results. The national climate agenda is on the verge of collapse. The tide is rapidly rising against greater federal investment. And Asia is moving at break-neck speeds to dominate this industry and seize the mantle of global economic leadership.

Fifty years ago, in the wake of the launch of Sputnik, the United States rose to the moment and launched a massive national effort to lead the space race and win the Cold War. Today, the clean energy race represents one of the greatest opportunities and challenges for American leadership in a generation, and it demands a similar national mobilization.

If the administration and Congress do not take swift action to invest $15 to 30 billion annually in federal clean energy R&D - along with a broader set of investments in clean energy deployment, infrastructure and education - the United States will miss a historic opportunity to strengthen our economy, create new jobs, improve our energy security and lead the world in confronting climate change. A decade from now, we may still find the prosperous clean-energy economy promised by our national leadership. It will simply be headquartered in China.

Teryn Norris is a weekly columnist for The Stanford Daily and recently launched a student initiative called Americans for Energy Leadership. Feedback is welcome at terynnorris@stanford.edu.

By Leigh Ewbank, Breakthrough Fellow

Recently, the Australian Greens challenged the Rudd Government to "break the Carbon Pollution Reduction Scheme (CPRS) deadlock" by implementing an interim price on carbon. The move no doubt stunned many with its pragmatism and has since won the backing of the government's former chief climate change adviser Ross Garnaut. While the move may give the Greens a PR boost, the proposal will work to strengthen the Coalition's recent framing of carbon pricing as a "great big tax". This of course has implications for Labor's climate policy agenda in an election year.

The Greens proposal would impose a $20 per tonne "price" on carbon emissions for two years, starting from July this year. According to the Greens, the interim measure would allow the nation to start addressing its ballooning carbon emissions and provide the Parliament with enough time to resolve differences over the government's emissions trading legislation. While this sounds like a sensible proposition, it plays into Abbott's strategy of framing Labor's emissions trading scheme and other carbon pricing measures as a "great big tax." Without the presence of carbon trading, Coalition MPs will have an easier time convincing the public that "carbon pricing" is in fact a form of taxation.

The Essential Report (PDF 116KB) also suggests that Labor is loosing the CPRS messaging war. Even after several years of public debate establishing emissions trading as central to tackling climate change, only 30 per cent of those polled considered a price on carbon as "crucial to addressing climate change". This figure is woefully low considering the groundwork put in by the government and supporters of emissions trading. In contrast, the Coalition, which has been branding emissions trading a tax for several months, would be happy to learn that 45 per cent of respondents agreed with them - that the CPRS is a tax.

So what options are there for the Rudd Government? How can they navigate the new political terrain and avoid a damaging election year defeat on climate policy?

Rudd's options are limited. Tony Abbott has claimed "direct policy measures" to reduce Australia's carbon emissions, so the government risks giving the new Opposition Leader a policy victory if it reorients its climate policy away from emissions trading and towards alternative measures. Adopting the Greens interim pricing measure will serve the Coalition's attempt to brand "ETS as tax". Alternatively, Labor can submit CPRS to the Senate for the third time, but it is certain to be rejected unless they adopt Greens amendments, which they won't.

The best way forward for the government is to implement direct measures but reframe them as part of a nation building agenda, denying Abbott the policy victory he is searching for. The government can explain its decision to put the emissions trading agenda on hold by pointing the Coalition's obstructionism, the failure of the Copenhagen summit to produce a meaningful agreement, and recent political developments in the United States that will almost certainly delay cap and trade passing the Congress.

By framing the new climate agenda as a nation building enterprise comparable to the Snowy Mountains Scheme is good politics and good policy for the Rudd Government. Drawing on its political legacy as the party of nation building, Labor can tap into the high priorities of the electorate and put Australia on track to reducing its contribution to climate change. The government can demonstrate the benefits of sustainable development by building a renewable electricity grid, funding adaptation projects and investing in clean technology R&D and deployment.

This approach to climate policy will support Australian jobs and industries, including the burgeoning clean energy sector, and build the foundation of a clean energy economy. Additionally, the approach will allow Labor to capitalise on its lead in the Essential Research poll as the best major party for jobs, industry, environment, and climate.

So what are the chances of a nation building initiative that requires billions of dollars of investment winning public support? Recent polling on Tony Abbott's "green army" proposal estimated to cost $750 million a year provides some idea. Abbott's promise to fund a large-scale project to improve the health of the Murray-Darling Basin was supported by 59 per cent of respondents and opposed by a mere 15 per cent (26 per cent were undecided). The result shows that the public is willing to support investments in projects that deal with environmental challenges of national significance. The popularity of economic stimulus measures that helped Australia stave of recession last year and the fact that $43 billion the government will invest over eight years in the national broadband rollout has escaped widespread public criticism, further support this assessment.

Ultimately, the government taking an investment-centred approach to climate policy will lead to debate about how to fund the initiatives in the long run. And such a debate can be used to legitimise carbon-pricing legislation in the future. Central to this, is the question of whose responsibility it is to pay for such measures. Is it the responsibility of all Australian citizens and businesses to invest our common wealth in climate change mitigation and adaptation, or is it just the responsibility of polluters through carbon-pricing mechanisms?

The Labor Government now faces a choice. It can adapt its climate policy to take advantage of the political realities of 2010, or face a third rejection of its CPRS in an election year.

In a promising development for aspiring clean energy scientists, engineers, and technicians, the Obama administration's 2011 budget request includes a proposal for the nation's first comprehensive federal education initiative focused on the clean energy sector, called RE-ENERGYSE (Regaining our Energy Science and Engineering Edge).

The initiative was originally proposed by President Obama in his April 2009 speech to the National Academy of Sciences, which he said would inspire and train young Americans to "tackle the single most important challenge of their generation -- the need to develop cheap, abundant, clean energy and accelerate the transition to a low carbon economy."

If appropriated by Congress, RE-ENERGYSE will be coordinated by the Department of Energy (DOE) and National Science Foundation (NSF), beginning with an initial investment of $74 million in clean energy-related education at universities, community and technical colleges, and K-12 schools. This will include a new $50 million program within DOE's Office of Energy Efficiency & Renewable Energy (see full proposal), a $5 million program in DOE's Office of Nuclear Energy (see full proposal), and a $19 million program within NSF (see overview and fact sheet). A summary of each program is included below. DOE's well-known Solar Decathlon is also proposed to become part of RE-ENERGYSE in FY2011.

"In order to make the leap in global energy technology leadership, the U.S. must also make the leap in energy education... This effort will help universities and community colleges develop cutting edge programs, with redesigned and new curricula to produce tens of thousands of other highly skilled U.S. workers who can sustain American excellence in clean energy in industry, trades, academia, the Federal government, and National Laboratories."

College students have a unique opportunity and an essential role to play in advancing this initiative. RE-ENERGYSE needs a much stronger base of support to pass Congress this year, especially in the current budgetary environment, and as the primary stakeholders in the program, students can be particularly influential in organizing a coalition of supporters and directly voicing their concerns to members of Congress. That's why Americans for Energy Leadership, Energy Crossroads, Associated Students of Stanford University, Scientists & Engineers for America, Breakthrough Generation, and a growing number of youth-led groups around the country are leading a student mobilization behind RE-ENERGYSE and working to advance larger federal energy education policy to build on this important program. See more at www.leadenergy.org and stay tuned!

Summary of RE-ENERGYSE FY2011 Programs:

DOE's Office of Energy Efficiency & Renewable Energy summarizes its program as follows: "RE-ENERGYSE will develop leading edge undergraduate and graduate programs; help between 3,000 and 6,000 highly educated scientists, engineers, and other professionals enter the clean energy field by 2016; and approximately 7,000 to 13,000 professionals by 2021. By 2016, efforts will result in the development of approximately 75 community college and other training programs to equip thousands of technically skilled workers for clean energy jobs. By 2016, thousands of U.S. residents and students will be educated about clean energy technologies leading and cost saving benefits [from energy efficiency]."

DOE's Office of Nuclear Energy summarizes its program as follows: "This program will provide important educational support to bolster nuclear engineering and science programs at U.S. universities, which supports continued use of nuclear power... RE-ENERGYSE supports university nuclear engineering programs through scholarships and fellowships. These fellowships will complement existing Federal efforts and will help ensure that the next generation of scientists and engineers are available to support existing and future nuclear energy generation capacity and provide necessary innovation... In FY 2011, the RE-ENERGYSE program plans to fund approximately 88 one-year scholarships and 30 three-year fellowships to students enrolled in nuclear energy-related fields of study of disciplines at U.S. universities and two-year colleges."

National Science Foundation summarizes its program as follows: "In FY 2011, NSF will invest roughly $19.0 million in RE-ENERGYSE through five existing research and education programs that help develop the future STEM workforce. These programs provide fellowships, traineeships, and research opportunities for undergraduate and graduate students, as well as build collaboration between academia and industry. NSF will contribute at least 5 percent of its support for the following programs towards specific, energy-related awards: Graduate Research Fellowship (GRF); Graduate STEM Fellows in K-12 Education (GK-12); Integrative Graduate Education and Research Traineeship (IGERT); Support for community colleges through Advanced Technological Education (ATE); and Research Experiences for Undergraduates (REU) sites."

View the entire video below or click here:

By Leigh Ewbank

Australia's new Opposition Leader Tony Abbott has declared war on the Rudd Government. He has kicked-off his leadership by implementing a polarisation strategy, with the emissions-trading policy forming a central part of the political battlefield. The Opposition's new strategy provides some insight into the way in which the cap and trade politics might unfold in the United States.

The new Opposition Leader has identified the proposed emissions-trading scheme as a weak point for the Rudd Government. Labor exposed its vulnerability with efforts to keep the public debate centred on climate change 'skeptics' and 'deniers', the best example of which being Rudd's high-profile speech at the Lowy Institute late last year.

The Rudd Government has created the perception that emissions trading is the only available climate policy option. They have framed opponents of the so-called Carbon Pollution Reduction Scheme as 'climate skeptics' and opposition to the policy as preventing action on climate change. Former Opposition Leader Malcolm Turnbull bought into this logic--or played along with it--throughout the emissions trading debate and diminished the need for the Government to explain the details of the CPRS to the general public. The result is that while the Government's emissions trading policy is well known to the electorate, how it functions remains largely unknown--excluding of course the climate campaigners, policy wonks, and politicos closely following the passage of the legislation.

The Opposition Leader hopes to benefit from the electorate's ability to understand what a new tax means, and inability to comprehend Labor's emissions trading scheme. Abbott expects to harness anti-tax sentiment he believes exists in the electorate, but as a safeguard he's betting that on the off chance Labor can explain the ETS, they won't be able to do as well as the Coalition's catchy 'ETS = tax' sound bite.

Abbott is also tempting Rudd to defend the financial impact of the ETS by pointing to compensation for low to medium income households. The Coalition will brand this 'a transfer of wealth' to rev up its base.

Whether or not Abbott's strategy will work is yet to be seen, and it's possible that he is overestimating Australia's opposition to taxation. He of all people should remember that it was former Prime Minister John Howard who was re-elected in 1998 with a commitment to implement a goods and services tax--'a great big tax'.

The bottom line is that if Abbott can shift the debate to away from the Labor's preferred terrain of the 'climate skeptic/denier' debate, he'll cause some concern for Labor who may not be adequately prepared for the attack. If everything goes according to Abbott's plan, the Coalition might just be able to land a significant political blow in an election year.

In the US context, one can expect the Republicans to follow their conservative cousins in Australia in branding carbon pricing measures 'taxes.' They will also follow the Australian Opposition Leader in branding compensation for households as a 'transfer of wealth.' While the effectiveness of the 'transfer of wealth' argument is limited in Australian politics, the GOP will use it against their political rivals as yet another example of Democrats pursuing 'big government' policies. This messaging will be deployed to thwart the Democrats' cap-and-trade agenda and damage the party in the lead up to the mid-term elections.

Last year, Obama used his congressional address to take on every major challenge facing the nation, all at once, but it appears Obama will revert back to Clinton era small ball in his first State of the Union address tonight. Press reports suggest that the President intends to offer the nation a range of small and symbolic actions - a $100 million or so in middle class tax breaks and a freeze on non-military discretionary spending, most prominently.

For those keeping score at home, $100 million is approximately equivalent to 1/20th of what George Soros made last year betting against the Bush economy and non-military discretionary spending covers pretty much everything except all the stuff that is actually driving up the budget deficit.

Dear Obama, David Axelrod, or whomever decided this was a good idea: That whole school uniform triangulation strategy made some political sense back in the Clinton years because the economy was already in the midst of the largest economic expansion in American history. With Gingrich and Co. attempting to lay waste to the entire federal government, symbolic proposals were a useful way to take some credit for the economic boom while reminding everyone that the President was still relevant.

But last we checked, the President still had 59 Democrats and fellow travelers in the Senate, a commanding majority in the House, and a stalled economy with 10% unemployment that the American public expects him to fix.

As Nate Silver points out, it doesn't matter that "the spending "freeze" will only apply to certain types of spending," what does matter is the "cognitive dissonance that is going to be created in the mind of the average voter when the White House is promising to freeze spending on the one hand... and on the other, trying to defend its stimulus and its health care reform package, trying to excuse the bailout package as a necessary evil, and perhaps trying to champion new programs."

So what's it going to be Mr. President? School uniforms and deficit reduction or a massive jobs bill in hopes of saving everybody's political hide? This is still Obama's economy and Obama's Congress. Generally you wait until after the other guys have taken control of the nation's checkbook to propose the discretionary spending freeze. The administration's current peregrinations look more like a frantic casting about for every post-1994 Clinton era fix they can think of than a coherent plan to revive the Democrats' flagging political prospects.

If panic, as readers will recall from our last Daily Breakthrough, results in the inappropriate application of familiar tactics to new and unsettling circumstances, then it's clear that Democrats have hit the big red "press only in emergency" button. In the current political and economic context, ceding the majority before you've lost it, and calling for a spending freeze while hanging your political fortunes on more spending to turn around the economy is more likely to get you attacked with a pitchfork than offered a life vest.

At least POTUS has company. Beau Biden, another Democratic definite for the Senate, announced he won't be running for the seat his dad had already decorated with a name-tag and balloons. And other Democratic incumbents are following suit, concluding that they have no chance to win come November.

John Kerry, meanwhile, has announced that he is going down with his "cap"sized ship, declaring that the forthcoming Senate economic rescue package would have no impact on his plans for climate legislation this spring. Some green groups are apparently planning to back that effort with $60 million in cold hard cash. Looks like a suckers bet to us and Lindsey Graham, Senator Kerry's erstwhile Republican partner in this effort apparently agrees.

Other greens say they've had enough and are looking to strike out in a bold new direction. Could it be that they are joining Breakthrough, Adam Werbach, Mark Kimbrell, and, yes, Bill Gates in calling for public investment in clean energy innovation as the next and best option?

Nah, the Climate Task Force Alliance has come up with something truly novel: a carbon tax!

Scott Brown literally won his MA Senate seat by yelling "cap and TAX!" from the top of his lungs and that's their advice? A tax?

Meanwhile, Frank Luntz's new EDF funded poll shows - surprise, surprise - that energy security and economic competitiveness are the strongest arguments for addressing climate change and building a clean energy economy. The boys over at ClimateProgress can't seem to decide what to make of him. Dan Weiss thinks he's just dandy now that EDF has paid him to say nice things about climate legislation but Joe Romm continues to believe that Bill Gates, like anyone else who tells the truth about the energy technology gap, has fallen under his evil spell.

Regardless, we're pretty sure Frank knows that a "carbon tax" doesn't stand a chance in hell. We're also pretty sure that once Frank gets paid for the latest green group vanity poll he'll get back to telling his regular clients what he really thinks the public thinks about cap and trade.

Joe Klein, on the other hand, thinks the public is just plain dumb - too ignorant to understand that the stimulus money hasn't been wasted because it mostly hasn't been spent yet. And no doubt, it's true that you can't really expect stimulus money to improve the economy when it hasn't actually been spent. But when you pass a stimulus bill with the promise that it will stimulate the economy RIGHT NOW and then can't figure out how to spend most of it for the better part of a year, it's hard to blame the public for concluding that you wasted the money.

Martha Coakley's pollster and long-time Friend of Breakthrough Celinda Lake properly gives the public more credit:

"Somebody is going to get the blame for what's happening right now to the American public. They're incredibly angry and incredibly frustrated. And somebody's going to get credit for trying to turn it around. And right now, we're getting the blame and we're not getting the credit,....Voters are still voting for the change they voted for in 2008, but they want to see it. And right now they think they've got economic policies for Washington that are delivering more for banks than Main Street."

And that brings us back to the "C" word we started with - choke that is - and we're not talking about the pretzel that nearly did in Obama's predecessor.

Choking is different than panicking. In the same piece from which we borrowed his definition of panic, Gladwell also offers a useful definition of choking. Choking, he says, occurs when "[u]nder conditions of stress... the explicit [knowledge] system...takes over." In other words, you over-think what you already know how to do by rote.

"If panicking is conventional failure, choking is paradoxical failure," Gladwell observes.

On the 2008 campaign trail, it seemed like Obama had an inherent, or say, "implicit," knack for appealing to the middle, for upending the old way of doing things and persuading many long-since jaded and cynical Americans that Washington could change -- for the better.

But under the initial duress of the Presidency, he reverted to his explicit learning system (read: vintage Clinton era Democratic conventional wisdom). Instead of capitalizing on his hard-earned popularity and widespread public demand for change, he embraced the Bush Administration's Wall Street bailouts and made them his own, handed his legislative agenda over to a vastly less popular Democratic Congress and his energy agenda over to green groups - whose disconnection from public opinion reality is awe inspiring in its stubborn persistence.

One year later, a disheartened public is still waiting for the big changes that Candidate Obama promised. Reflecting on the meaning of the Coakley defeat, her pollster said it best:

"We're either going to get buried by the wave or we're going to ride it. And we're running out of time to ride it."

World Resources Institute conducts ostensibly independent and objective analyses of environmental legislation for Congress, media including the New York Times, and advocates. But in its analysis of competing climate legislation, WRI used a double standard for measuring emissions reductions in a way that resulted in a more favorable intepretation of Waxman Markey legislation -- legislation WRI helped create.

1. Role of Carbon Offsets Central to Understanding Whether Legislation Will Reduce Emissions

Carbon offsets represent perhaps the most contentious single element of climate legislation currently proposed in Congress. Many environmental groups and energy industry interests support the broad use of carbon offsets because they promise to limit the cost associated with reducing carbon emissions while offering firms greater flexibility in complying with carbon caps.

Unfortunately, there is strong and growing evidence that carbon offset programs deliver little by way of actual emissions reductions. Numerous experts warn that offsets may not represent real emissions reductions (logging, for example, may just move to non-offsetted properties) and are in many cases fraudulent (e.g. businesses being paid to do what they would have done anyway, like capturing methane, planting trees, building dams, not tilling, and not logging).

Offsets play a central role in the Waxman-Markey and Kerry-Boxer bills and their availability, price and legitimacy will likely be the principle factor determining the ultimate impact of the legislation.

Both Waxman Markey and Kerry Boxer permit such a large quantity of offsets -- up to 2 billion tons per year or virtually all of the required emissions reduction between 2012 and 2020 -- that U.S. firms could be entirely exempt from reducing their own emissions, adopting new power technologies, or transforming the U.S. energy system for much if not all of the next two decades. If offsets do not in fact deliver real emissions reductions, then total emissions could rise at business-as-usual levels through 2020 or beyond if firms turn to offsets at even a fraction of the level permitted by the legislation.

With securing a competitive and job-creating U.S. clean energy economy increasingly central to the objectives of climate legislation, a responsible analysis of pending climate bills would clearly account for the huge variance offsets introduce to the ultimate impact these bills will have on both U.S. carbon emissions and the U.S. energy system.

Instead, WRI's analyses and graphics of Waxman-Markey and Kerry-Boxer assume all offsets are "real, verifiable and additional." They present offsets purchased by U.S. polluters from domestic or international businesses outside of the capped sectors of the U.S. economy as real emissions reductions. They represent ostensible emissions reductions from sources outside of the United States as if they constituted reductions of emissions from U.S. sources. And they ignore the vastly different impact on the pace and scale of clean energy transition if U.S. firms turn to offsets instead of transforming their own energy technologies and business practices.

2. WRI Hides Use of Offsets in Graphs of Waxman Markey

While WRI maintains a reputation for independent analysis, WRI is in fact a policy advocacy organization. It cofounded the lobbying group known as the United States Climate Action Partnership (USCAP) with Duke Energy, other green groups, and other energy companies. The policy framework authored by USCAP became the foundation of the Waxman-Markey and Kerry-Boxer bills.

In Foreign Policy magazine, we criticized World Resources Institute (WRI) for creating a widely-used graph showing that Waxman Markey climate legislation would reduce U.S. greenhouse gas emissions 17 percent by 2020, even though the legislation would allow most if not all of those emissions to be reduced through the purchase of carbon offsets.

WRI analysis author John Larsen responded by pointing to a caveat he made in his analyses starting on June 25:

If the environmental integrity of offsets were not completely real, permanent, and additional then the emission reduction estimates included in this analysis would be diminished proportionately.

But this caveat did not appear in WRI's analyses of April 22 and May 19, when the legislation was being debated. In fact, in its April 22 analysis WRI wrote:

[W]e assume: Offsets will be real, permanent and additional. As a result, we depict offsets as a real reduction in total global GHG emissions.

WRI said nothing about the problem of counting offsets as emissions reductions, nor of the highly nuanced caveat Larsen cites above.

Moreover, WRI's widely used graph, reprinted in the New York Times and other media, counted and showed carbon offsets as legitimate emissions reductions under Waxman Markey. There was no way for readers to know that the legislation required few if any emissions reductions by polluting firms for the first one or two decades of the program since they could just purchase offsets. The New York Times reprint of the WRI graph acknowledged "critics" who were skeptical that the emissions reduction targets would be met, but did not show on the graph what percentage of Waxman Markey's proposed emissions reductions could be met through offsets. The Times graph is not visible in the on-line story, so we have reprinted it here.

Graphs, like pictures, speak a thousand words, and an accurate and unbiased visual representation of what legislation does and does not do is the expectation of independent analysts.

Today WRI continues to promote a graph showing Waxman Markey reducing emissions 17 percent (the above graph was from December 22, 2009) with no mention of offsets as comprising most and perhaps all of the emissions reductions required by the bill.

3. WRI Uses Double Standard When Evaluating Competing Climate Legislation

Further evidence that WRI's analyses are biased in favor of legislation WRI helped to create comes in its analysis of Senator Cantwell's CLEAR legislation, a competing proposal introduced late last month in the Senate.

Breakthrough has done its own analysis of the strengths and weaknesses of the CLEAR approach and has taken no position either in favor or in opposition to the legislation. In so doing, we have made sure to treat emissions mitigation activities in non-capped sectors of the economy consistently in our analysis and representation of CLEAR, Waxman-Markey, and Kerry-Boxer. By contrast, WRI's analysis of the Cantwell bill, and the graphics that accompanied it, treats such activities differently than it does in its earlier analyses of Waxman-Markey and Kerry-Boxer, choosing not to count reductions resulting from policies targeting emissions outside the capped sector of the economy and thus using a different standard than it used when analyzing the Waxman-Markey and Kerry-Boxer proposals WRI supports.

CLEAR does not permit any offsets but does pursue additional emissions reductions outside the cap, setting aside 25% of the bill's cap and trade revenue for a trust fund that prioritizes funding for programs that pursue emissions reductions in non-CO2 emissions and carbon sequestration in forestry and agriculture (both domestic and overseas).

These policies target exactly the same kinds of supposed emissions reductions, such as tree planting and methane capture, as would be accomplished through offsets allowed under Waxman Markey. Only CLEAR funds such activities directly, rather than leaving it to private firms to finance them in lieu of reducing emissions.

Given the well documented failures of the offsets markets to date, it would be reasonable to assume that funding non-energy related emissions reduction efforts directly through the mechanisms proposed in CLEAR would be at least as effective, if not more effective, than the offsetting allowed in Waxman Markey. Yet WRI attributes zero emissions reductions to these programs in its analysis of CLEAR while attributing up to 2 billion tons of emission reduction, virtually all of the emissions reduction required through 2020, to these same actions in its analysis of Waxman Markey.

For example, in the "net emissions reductions" graphic above, WRI counts any emissions reductions pursued outside of the capped sectors through offsets as real reductions and includes them in the emissions reductions trajectories depicted for Waxman-Markey, while at the same time portraying none of the emissions reductions pursued outside of the cap in CLEAR.

In contrast to Waxman Markey/Kerry Boxer, CLEAR deals with the questionable nature of offsets transparently. CLEAR distinguishes between carbon emission and other greenhouse gas emissions. It distinguishes between actual reductions of carbon emissions and programs intended to create or preserve carbon sinks like reforestation. It distinguishes between reductions in capped sectors of the U.S economy and non-capped sectors. And it distinguishes between U.S. emissions reductions and those that occur elsewhere. In so doing CLEAR does not allow efforts to drive additional emissions reductions outside the cap to undermine the pressure on firms under the cap to turn to new energy technologies and practices. WRI ironically uses this transparency against CLEAR to claim Waxman Markey will reduce emissions faster than CLEAR.

WRI's bias is further revealed in a second way. WRI did not update its business-as-usual emissions assumptions for 2012 to take into account the impacts of the recession, which reduced emissions 6 percent in 2009 alone. Thus, WRI overestimates 2012 emissions levels, which biases their analysis against CLEAR.

While Waxman-Markey and Kerry-Boxer's caps are set based on 2005 levels, and are thus unresponsive to real emissions levels in 2012, CLEAR sets its emissions based on 2012 levels, so WRI's higher projections for 2012 BAU emissions substantially understates the emissions reductions mandated by CLEAR. Using current (and more accurate) projections of post-recession emissions trajectories results in CLEAR emissions targets potentially achieving similar (or greater) levels of real emissions reduction in U.S. capped sectors as Waxman-Markey and Kerry-Boxer (see BTI analysis comparing the bills here).

This could be remedied by updating their baseline with new Energy Information Administration data, which give a fair, apples-to-apples comparison of climate legislation. The new EIA BAU estimates were available last August. Breakthrough Institute developed preliminary estimates of post-recession BAU emissions back in September, which revealed that Waxman-Markey and Kerry-Boxer are both likely to over-allocate permits in 2012 and 2013 (since their cap levels in 2012 are pegged based on pre-recession 2005 levels). Yet WRI's December analysis of CLEAR continued to rely upon outdated baseline estimates that overstated reductions in Waxman Markey and understated reductions in CLEAR.

4. WRI Misrepresents Funding in Climate Bills for Energy R&D

At the end of his response World Resources Institute analyst John Larsen claims that we understated how much Waxman Markey would invest in R&D. In fact, the legislation would invest just $1.2-1.6 billion in R&D (at EPA and CBO-projected allowances prices, respectively), roughly one-tenth of what President Obama has promised to invest, with a small amount of money going to deploying technologies such as $2 billion a year for clean coal technologies, which would not be enough to build a single new clean coal plant.

The argument in the Foreign Policy piece was clear. Much larger sums of money need to go into R&D to solve a set of technical problems with solar, nuclear, biofuels, and batteries - problems that Secretary Chu and other experts have identified. The portions of Waxman Markey tied to specific projects, from clean coal to electric cars, may be worthy but are simply not the same as R&D. That Larsen includes money for adaptation in his list of "investments and new requirements for clean energy technology" speaks loudly of WRI's understanding of what it will take to overcome the wide technological gap between fossil fuels and low-carbon energy sources.

A new Clean Energy Deployment Administration (CEDA) is critical to "position the U.S. as the global leader in the development and deployment of clean energy technologies for years to come," according to a letter written by the country's leading clean tech entrepreneurs, investors, and stakeholders.

Thirteen leading clean tech companies, including Google, GE, and Kleiner Perkins, wrote to President Obama last week urging him to expedite the creation of a Clean Energy Deployment Administration along the parameters outlined by the Senate's American Clean Energy Leadership Act of 2009 (ACELA).

Perhaps the most important and unique feature of CEDA is that it would be the first example of a deployment-oriented agency specifically designed to further accelerate clean energy innovation. To date, most clean energy deployment policies - renewable electricity standards, production tax credits, even the House version of CEDA - are far more focused on driving megawatts into the ground (and thus supporting more mature technologies, like wind). In contrast to the House version, which is more likely to act as (and compete with) a typical bank, the Senate's formulation of CEDA breaks new ground for deployment policy in its understanding that innovation doesn't end at the lab. Under ACELA, CEDA would have the ability to take on riskier projects thanks to explicit technology improvement goals, with objectives to drive lower prices and higher performance in an array of nascent clean technologies that advance some of the nation's most pressing interests.

In the letter, the advocates expand:

"We believe the availability of CEDA financing will help America's emerging clean energy technology companies cross the so-called "valley of death" between the invention of a technology and its commercial deployment, and thus substantially accelerate and increase private sector investment necessary to position the U.S. as the global clean energy leader. In short, CEDA will help finance the scale-up of precisely the kinds of innovative technologies that will create new, 21st Century American jobs and position the U.S. to capture the economic benefits of the global transition to low-carbon energy infrastructure."

CEDA is a critical component of the kind of clean energy competitiveness strategy that the United States must have to compete with other nations moving aggressively to capture global clean tech market share. In fact, clean tech companies in many other nations receive this sort of financial support, making it all the more necessary that this measure is fully capitalized with at least the $10 billion contained in ACELA - and probably much more over time.

Coming from a diverse group of clean tech innovators, this letter shows that private sector leaders are firmly behind the creation of CEDA and Senator Bingaman, who has been a leading champion of this critical and innovative program. With the potential to create thousands of clean energy jobs and provide a boost to long-term U.S. economic competitiveness, CEDA must be a part of any jobs or energy legislation that comes out of Congress.

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President Obama is preparing his first State of the Union address, where he will no doubt point to accomplishments from his first year. His supporters in the environmental arena say there are many: historic new standards for auto fuel efficiency, EPA action to control carbon dioxide emissions, and a new focus on chemical safety. And the President has made cleaner energy a high priority:

OBAMA: From China to India, from Japan to Germany, nations everywhere are racing to develop new ways to produce and use energy. The nation that wins this competition will be the nation that leads the global economy. I'm convinced of that, and I want America to be that nation.

YOUNG: But not all the green reviews of Obama's first year are positive: a provocative piece in the journal Foreign Policy says Obama promised to launch a green energy revolution but failed. Co-author Michael Shellenberger leads the policy think tank, the Breakthrough Institute.

He says the president erred by expending political capital chasing a cap on carbon emissions, and not spending enough to develop clean energy technology. Shellenberger titled the Foreign Policy article, "The End of Magical Climate Thinking."

SHELLENBERGER: The core of magical thinking about climate change is that we have all the technologies we need and we just need to implement them. Really we have to focus on solving particular technology problems in order to be in a place where it's not going to cost a lot of money to deal with climate change.

Solar panels have to more efficiently covert sunlight into electricity; nuclear power plants have to become smaller, cheap and safer; biofuels right now, such as ethanol, are really not any better environmentally, some say they are worse, so we need to have much cheaper, much cleaner biofuels; and we need to have batteries that are inexpensive and that requires some basic advances at the level of chemistry so we can store a lot more energy a lot more cheaply in a lot smaller amount of space.

YOUNG: I thought the argument was though that by putting a price on carbon, or by setting a hard cap on emissions reductions, that's what's going the drive the investment in those kinds of technologies?

SHELLENBERGER: Yeah, and so the idea has been: well, we have to put a price on pollution because then the private sector will make the investments in the technologies. But what we've seen is that even in places like Europe where the price on carbon dioxide pollution reached 40 dollars a ton, Europe continued to build coal plants - and not the new kind that supposedly will capture the carbon pollution and store it underground, but just the same old kind.

In other words, it would require a cost on pollution, it would require raising the price of fossil fuels so high that no government in the world is willing to pay that price. The amount that the public is willing to pay in terms of an increase in energy prices has been exaggerated. Really, these are challenges that governments traditionally deal with.

In the space race with the Soviet Union, NASA needed computers, the federal government essentially invented the entire field of computer sciences, funding scholarships; we bought down the price of microchips from a thousand dollars a chip to 20 dollars a chip. You know, we point out that we didn't get the personal computer through a cap and trade system on typewriters, we didn't get the Internet by putting a telegraph tax or a fax tax; we create these new technologies and we make them cost competitive directly.

YOUNG: To be fair though, I mean, I think we have to look at the significant investment that has been made here. The Recovery Act alone put tens of billions of dollars toward clean energy R and D, right?

SHELLENBERGER: It did. The Stimulus Act by President Obama was an outstanding first step. But the most important lesson from that is that it really countered the conventional wisdom that the federal government just isn't going to invest in technologies.

Well I think the stimulus disproved that. It showed that in fact, it's much more popular for the federal government to invest directly in these technologies. In fact, I think the latest polls show that it's the most popular of all energy policies. Direct energy R and D spending especially for things like renewables, solar and wind is extremely popular - far more popular than cap and trade or putting a price on carbon dioxide.

YOUNG: Isn't it possible that this kind of single-minded focus on new technology as the answer is itself a bit of magical thinking?

SHELLENBERGER: The funny thing about climate change is that in contrast to so many other challenges in our society that we haven't seen it as a technology problem. It's funny when you think of a problem like Polio, we didn't say, well we really just have to shut down all the pools permanently, we're not going to be able to live the way we've been living - there was a big effort to find a vaccine, a technological fix. And in fact, even in the environmental community today if you want to criticize somebody you say, well they believe in technological fixes, as though it's sort of illegitimate or as though it is magical thinking.

In truth, we solve a huge number of the challenges we face as human beings with new technologies, that's how we're going to dramatically reduce our emissions to deal with climate change. And so, I think that instead of viewing it magically we need to understand that technological progress is hard, it doesn't happen automatically with a few new regulations or a price on pollution, that there's a set of pretty clearly identified problems that energy scientists believe we need to solve. It's not going to be easy to solve them, where it's not a single Apollo project; we need several Apollo projects on these big technological challenges.

YOUNG: But with the budgets tight, as they are, is that still a viable option?

SHELLENBERGER: Absolutely. We're not going to cut our way out of our current fiscal crisis; we've got to grow our way out. That's what we did in the 90's: we saw the Internet boom, we saw a huge growth in information technologies. That was a result of investments that we were making in the 50's and 60's.

We need to be making a much more serious investment today in these new clean energy technologies. There's definitely going to be a market for them. The world is going to double how much energy it consumes by the middle of the century. Energy is the master resource of the economy. It's the one thing that you know there's going to be more demand for.

We can either meet that demand by rising to that challenge and doing the same thing that we know works, or we can kind of continue to engage in this magical thinking, which has led to no action over the last 20 years and really now at the point of being past by China, Japan, and South Korea when it comes to creating these new industries.

YOUNG: Michael Shellenberger is president of Breakthrough Institute and author of a piece that's in Foreign Policy called "The End of Magical Climate Thinking". Thanks for your time.

SHELLENBERGER: Hey, thanks for having me.

Link to the original piece here.

That was the question posed last week to Energy Secretary Steven Chu as he testified before the Senate Energy and Natural Resources Committee. Chu was speaking on the central role that energy research and development holds in any successful effort to mitigate climate change.

During questioning, Senator Ron Wyden (D-OR) quotes an earlier statement by Secretary Chu, calling it "the challenge of our time":

"The only question is which countries will invent, manufacture, and export clean technologies, and which countries will become dependent on foreign products?"

Unfortunately, the United States is headed in the wrong direction. According to Senator Wyden, who chairs the Senate Subcommittee on International Trade, Customs, and Global Competitiveness, "80% of clean energy investments are going to take place outside the United States, even though global trade in environmental goods has doubled just in the last few years."

A recently published report by Senator Wyden's office shows that global exports of environmental goods (the majority of which are associated with clean energy technologies) more than doubled to $215 billion from 2004 to 2008. While U.S. exports have certainly benefited from the major expansion in worldwide demand for clean tech products, it has steadily lost international market share as other nations move more aggressively to capture competitive advantages in the burgeoning clean energy sector.

In the United States, clean tech imports have grown faster than exports, and U.S. exports have not kept up with global demand or international competitors, leading to an erosion of market share for U.S. products. By contrast, other nations, particularly China, have dramatically boosted their exports over the five-year period with China experiencing the greatest value growth in clean tech exports of any nation in the world.

Key figures from the report include:

• The United States is the largest import market of environmental goods (EG) as well as the fastest growing import market from 2004-2008 in terms of product value.
• In the last five years, the U.S trade deficit in renewable energy products increased by 1,400% to nearly $5.7 billion. 
• The United States faces declining export market shares in virtually every regional market, while China has substantially increased its market share in every regional market, over the last five years.

The conclusions of the Wyden study are consistent with the findings in "Rising Tigers, Sleeping Giant," a recent Breakthrough Insitute/ITIF report on international clean tech competitiveness.

That report finds that China, Japan, and South Korea have already surpassed the United States in the production of virtually all clean energy technologies and will out-invest the United States by 3-1 in clean tech over the next five years. Should this investment gap persist, notes the report, "the United States will import the overwhelming majority of clean energy technologies it deploys."

The report outlines a comprehensive strategy to regain economic competitiveness in clean energy built on three pillars: research and innovation, manufacturing, and domestic market demand. Chu alluded to the latter in a response to Senator Wyden:

"You need local demand to encourage the manufacturing of these products here...if there is no local demand and it's all abroad, they will build the factory abroad."

Spurred by massive government investment, the major demand for clean tech products in countries like China compels firms in the United States to construct facilities overseas. Chinese government investment in manufacturing and deployment led Applied Materials, the world's largest producer of solar manufacturing equipment, to build its new state-of-the-art solar R&D facility in Xian, China.

However, as "Rising Tigers" makes clear, the most successful national clean energy competitiveness strategy will include strong support not just for market demand - after all, America could simply meet demand by importing more foreign-produced products. Investments in research and development and manufacturing capacity are also critical to ensure continued American technological and manufacturing leadership.

Ultimately, the back and forth between Senator Wyden and Secretary Chu left as many questions as it did answers about the U.S. government's plans to remain competitive in clean tech markets. It is revealing, though, that with the Senate considering "comprehensive climate and energy legislation," such questions about a clean energy competitiveness strategy need to be asked at all. Clearly, Senator Wyden does not see the current climate bills, which are essentially pollution reduction plans proposed by DC-based environmental groups and negotiated with incumbent energy interests, as a replacement for a real national clean tech competitiveness strategy. Under the leadership of public officials like Senator Wyden, this critical issue may soon receive the kind of public attention it deserves.

In admitting paternity of a child he fathered in the midst of his campaign, Edwards has finally accepted that his political career is over. What will it take for greens and sympathetic fellow travelers to accept that cap and trade and the UN climate process is dying and move on?

A look around the blogosphere finds various key players working their way through Elisabeth Kubler-Ross's Five Stages of Grief (Denial, Anger, Bargaining, Depression, Acceptance).

The Guardian quoted U.S. official Jonathan Pershing attributing the results of Copenhagen to sleep-deprivation and late night cramming (who ever said college students weren't prepared for the real world?)

A week later, Broder seems to have finally accepted that the "climate deal is at risk" (ya think?). Broder would have learned more reading Newsweek reporter Sharon Begley's obituary for the UN climate process two weeks earlier.

Malcolm Gladwell once defined panic as the "reversion to instinct." Sometimes, like when fleeing danger, the panic instinct can save your life. But in others instances it results in inappropriate action in the face of changed circumstances.

In this way green denial has morphed into full-blown panic. The usual sources are claiming that now - with one less Democratic Senator and a looming November bloodbath for Congressional Democrats - is the perfect time for the Senate to take action.

"We're not licked," cried EDF's Sam Perry (what, is Fred Krupp in the Caymans?) in a cap and trade fundraising email. "Call me sentimental, but my favorite political movie is Mr. Smith Goes to Washington - one idealistic senator up against the mighty Taylor political machine."

From the sound of it you'd think greens were up against the entire U.S. energy industry.

Alas, no. EDF wrote much of the bill with major fossil fuel energy players like Duke Energy.

And most of the energy industry is backing the bill.

So not quite like Mr. Smith.

EDF's reaction isn't exactly denial. It's more like yearning -- yearning for the days when greens were the little guys winning, as opposed to the big guys losing.

Turns out that yearning is one of the longest lasting stages of grief according to a major study, published in the Journal of American Medicine, in which researchers found that the yearning stage starts about one month after the loss, which would set the time of death at roughly December 22, 2009 -- the end of the Copenhagen talks. (Yes, eerie.)

So it's one part denial that cap and trade could really be dead and two parts yearning for a simpler past when everyone thought we'd solve global warming just like we did acid rain. Yearning is, in this way, nostalgia projected forward.

Happily, some greens are moving on to Acceptance -- and even asking what comes next.

Bill McKibben, co-founder of 350.org, who Breakthrough has alternatively praised and criticized over the years, wrote in Mother Jones about a push for R&D as a potential alternative to cap and trade, and quoted Breakthrough co-founder Ted Nordhaus.

Breakthrough is often accused of being "techno-optimists." In fact, we are techno-pessimists: we don't think fossil fuels will be driven out with a carbon price or pollution regulations. We might succeed in making them a little more expensive, but certainly not enough to close the price gap with clean energy.

What Bill got right in the piece is that it really is the cap and traders who are the techno-optimists. They believe we have "all the technology we need," in Al Gore's immortal words, and a price on carbon and a few pollution regulations will usher in a low-carbon energy economy with little need for investing in R&D and other kinds of innovation to make clean energy cheap.

What Bill missed is that we support investment throughout the innovation process, not just R&D or basic science -- Bill has graciously agreed to make a correction.

In grieving the end of the U.N. process in Copenhagen, McKibben wrote, "I went to church. I cried. Then I got back to work."

Amen to that.