Q & A: E.T., Phone Home

An Interview with Tom Friedman

Will things be different under the next administration? Will the United States at last become a world leader on climate policy, instead of being an also-ran? Huge questions like these are Tom Friedman's bread and butter. Friedman has reported for the New York Times since 1981, winning three Pulitzer Prizes along the way. His latest best-selling book, Hot, Flat, and Crowded, looks at how we got into our current dangerous mess and lays out some far-reaching suggestions for what the country needs to do to lead the way out of it. Friedman talked with Sandy Johnson, former Washington bureau chief of the Associated Press, on the eve of Barack Obama's election.

How do you rate the prospects for getting a serious energy policy through Congress in 2009?

Everything depends on the economy, frankly. To me the only really big strategic change would be if we got a price signal on carbon-cap and trade or a carbon tax. If we're still in the grip of an economic crisis, that's just not going to happen. And therefore we're going to have to look on the subsidies side. Congress renewed the production and investment tax credits for wind and solar in October, which was a big deal. But a lot of start-up companies in clean power are going to have a hard time raising capital.

Could those items, in the aggregate, make a difference?

The smaller items are really important to keep innovation going, but unless you have the big price signal, it's hard to get the speed, scope, and scale we need for a green revolution. This crisis could not have come at a worse time. The green revolution will still happen, but much more slowly, and we need just the opposite.

Do we need a Manhattan-type project to get the nation's attention?

I don't believe in Manhattan projects. I believe we need to shape the market with a price signal. So instead of having 12 people go to Los Alamos and try to solve this thing, you get 100,000 innovators in 100,000 garages trying 100,000 things, a thousand of which might be promising, and a hundred of which might be way cool, and two of which might be the next green Microsoft or green Google. What I call an ecosystem of innovation is not going to be created by saying, "Okay, we're going to solve this by having the Apollo program for green." It doesn't work that way. I want the market to try all this experimentation. I want it to be much like the IT revolution.

So what's the role of government?

To shape the market so it will go out and do the innovation. It's a limited role, but it's an essential one because environmental technology -- ET -- is different from information technology. When the IT revolution emerged, there weren't three cheaper, dirtier versions out there. When Marc Andreessen invented the first browser, there weren't three Internets out there to compete with. ET is different. When you invent a solar-powered light, you're competing against a cheap, dirty light that already exists. Technologies have a much harder time emerging when they're competing against existing technologies that give you the same function, and that's why you need the government to come in and make those cheap, dirty technologies more expensive. So the clean, efficient, renewable technologies can achieve scale and eventually move down the cost/volume curve.

Where is the incentive for the innovators?

The incentive is a price signal on carbon. Once carbon is fully priced into that dirty light, then if I can come up with a solar light that's both clean and the same price, I have a huge opportunity. In fact, the sky's the limit.

Do you see any lawmakers who might really move climate legislation through the next Congress?

I'm a firm believer that there is nothing like the bully pulpit of the presidency. You get a president who is really committed to this and you'll have many, many lawmakers. But if you don't have a president who is ready to see this not just as a spoke in a wheel but as central, you're going to have a big problem.

There aren't any committee chairs who can play that role?

No, I don't believe so. We need a CEO, a chief energy officer, and the only one who can be a true CEO is the president of the United States. And if the next president gets sworn in and takes his hand off the Bible and gets on a Schwinn bicycle, and his wife is on a Schwinn bicycle, and his two girls get on tricycles, and they ride from the Capitol steps to the White House -- the next day, do you know how many bicycles will be sold? Do you know how many people bought Sarah Palin glasses after she first emerged? Well, now translate that into bicycles.

The fossil fuel industry is such a powerful lobby. Does the renewables industry have anything comparable?

You know, solar is getting bigger. And I would say that the energy efficiency lobby is getting bigger, and that's where you intersect with companies like Wal-Mart or GE, which become allies on energy efficiency, regulation, and innovation. We're in the middle of a big transition, and the business community is splitting. Wal-Mart is telling its own truckers that they've got to basically double their mileage on a certain time, and they want innovation that will enable them to do that. That's going to cut their costs. Companies are beginning to understand that green is better. It's not a hobby, it's not something you do to be cool, it's not branding. It's just better.

With Washington so slow to act, what about the state level? For instance, the governor of Oregon wants to set up electric stations on major highways to promote electric vehicle use.

No one has done more than California, with a succession of governors, but you really have to give Arnold his chops on this. I'm a big believer that one good example is worth a thousand theories. The great thing about our federal system is that people say, "Oh, California did that, and it worked. Let's try it in Idaho." The federal system really empowers and enables experimentation. But at the end of the day you need federal laws, because right now we have 35 states with renewable portfolio standards, and six of those are only voluntary. Fifteen don't have them at all. If you look at the European Union, they have a single portfolio standard for 300 million people. And if you're a company, you want to work where there is a common standard across a big market. That's what we need here.

So there are limitations to what any one state can accomplish?

Exactly. When you have a federal government that isn't leading, I'll take California. I'd rather have that than nothing, but ultimately it can't just be about 50 different experiments.

What about other countries? Who's taking the lead?

Well, you know, pound for pound Denmark has really done the most. One out of every three wind turbines in the world is made in Denmark. Two leading cellulosic enzymatic companies, Novozymes and Danisco, are Danish. Denmark exported somewhere between 8 billion and 10 billion dollars in clean tech last year. It's a major ticket item for them. Gasoline in Denmark is $10 per gallon, and they have a CO2 tax. So there's a real connection between standards, price signals, and innovation. Necessity is the mother of invention. They created the necessity, and their people responded with innovation.

And if the United States doesn't take a leading role, where does that leave us?

ET is going to be the next great global industry. I know that as sure as I'm talking to you here. I know we have all the stuff, the secret sauce, but I don't know if we're going to do it. I just don't know. Jeff Immelt [of GE] likes to say that if you want to be big, you have to be big in the big things. Well, there will be nothing bigger than ET. And if we miss out on leading the next great industrial revolution, then I believe our chances of having the same standard of living our parents gave us, the chances of our kids having the same standard of living we've had, are zero.