Abundance

by Ezra Klein

The election of Ronald Reagan in 1980, however, decimated the solar revolution in America. Driven by a conservative ideology that favored free markets and limited government intervention, Reagan dismantled much of the solar infrastructure built up over the previous decade. For secretary of energy, he appointed James Edwards, a dentist with no expertise or interest in developing nascent energy technology.26 Solar R&D spending under Reagan fell by over 60 percent his first year in office.27 Some of the dismantling was painfully literal: in 1986, Reagan removed the solar hot-water panels installed on the White House roof by Jimmy Carter.

Reagan’s election was the most important factor in the slowdown of US solar development, according to Nemet.28 His conservative revolution coincided with a huge drop in gasoline prices, as Saudi Arabia flooded the market with cheap oil in the 1980s. Consumers embraced gas-guzzling SUVs, and alternative energy fell out of favor. The spirit of imagining life after oil seemed to shrivel up and die. As late as the early 2000s, federal energy R&D spending was still 80 percent below its level in the 1970s.29 The US solar industry gradually withered. Many companies couldn’t survive without government support. By 2001, renewable energy accounted for 5 percent to 6 percent of total energy consumption—the lowest share since at least 1989.30 As American firms pulled back from solar power, other countries picked up the slack.

If the US invented solar energy in the 1950s, and Germany made it a market in the 1990s, China made solar energy cheap in the 2000s.33 Without sufficient oil and gas resources to power a billion-person economy, China has had existential motivation to develop its own domestic energy technology. In the 2010s, Beijing got serious about building out a solar energy business, lavishing subsidies, loans, and free land to upstart solar-panel makers. Recognizing this lasting commitment, Chinese solar companies invested for the long run. Whereas America whiplashed between “boom and bust cycles” in solar policy that have “surely slowed down its progress,” Nemet wrote that China’s consistent policy has allowed its firms to build more, faster, and cheaper.

innovation is not a two-stage process, where a loner genius conceives of a brilliant idea and then a bunch of thoughtless brutes manufacture it. Innovation is enmeshed in the act of making. Wright’s law is the story of penicillin, whose costs declined as the government learned to cook larger batches of the medicine. It is the story of the Model T automobile, which became more affordable as Ford built larger and larger factories. It is also the story of the computer chip. In the 1960s, Gordon Moore, the founder of Intel, wrote that the number of transistors on a chip might double every two years.37 His prediction became prophecy. Fifty years later, transistor costs declined by a factor of one billion.38 Wright’s law echoes loudly in the history of China’s solar energy revolution.

Chinese firms gradually learned how to make solar panels more efficiently. In one case, a Chinese company bought a saw from a Swiss company that could cut thinner and thinner silicon wafers, which meant more panels from the same crystal ingot.39 They built machines to automate production lines. As they figured out what worked, they scaled up their lessons to build more production lines and larger factories. In 2000, China had barely enough solar energy to power a small town. By 2020, the nation was making 70 percent of the world’s photovoltaic panels.40 As China ramped up manufacturing, the cost of solar panels in the last fifteen years has declined by about 90 percent.

Seventy years ago, the New York Times had anticipated that America’s solar energy revolution would lead to “limitless energy.” But rather than treat limitless clean energy as a project of national urgency, the US treated solar panels as a trifling inessential, with no long-term plan to make or deploy them at scale. And we lost decades of progress because of it. In Germany, between 1990 and 2015, the share of electricity production that came from renewable energy like solar rose from about 3.5 percent to 30 percent.42 But in the US over the same period, solar’s share of electricity stagnated. These were wasted decades, which we are paying for in the form of more modern pollution, more dependency on fossil fuels, less total energy, and more expensive electricity bills.

John Arnold, the cochair of Arnold Ventures philanthropy, put it pithily: “America has the ability to invent. China has the ability to build. The first country that can figure out how to do both will be the superpower.”

For the past few decades, the eureka myth has walked hand in hand with another attractive fable: that the US government is helpless as an investor in new technologies. One useful summary of this view came from a 2012 Economist essay, which claimed “governments have always been lousy at picking winners, and they are likely to become more so, as legions of entrepreneurs and tinkerers swap designs online [and] turn them into products.” This dual image—the state, as a lazy slowpoke, versus the market, as the self-sufficient45 dynamo of innovation—bears little resemblance to history.

it is strange that we still debate whether the government ought to pick winners when it is obvious that we live in a world that has amply “picked” for us.46 When you use an iPhone, you are playing with a technology that bundles silicon chips, the internet, GPS, voice-recognition software, and multi-touch technology, which were in part funded by the Defense Department, NIH, the National Science Foundation, and other government entities.47

Nearly one hundred years ago, the economist John Maynard Keynes offered an elegant answer in his 1926 book The End of Laissez-Faire. “The important thing for government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things which at present are not done at all,” he wrote. If technological progress requires money or resources that are beyond the scope of any one company, and government does nothing, progress slows down. This is exactly what we saw after 1980 in the solar industry. As the private sector lacked the resources to scale solar production, Washington slashed its support, and the industry went cold. The highest purpose of a pro-invention government is to make possible what would otherwise be impossible. No private company could orchestrate the national production of penicillin in World War II, so OSRD did it. No private companies were close to putting a man on the moon in the 1960s, so NASA did it.48

Government should have a vision of the future, and within that vision it can create space for companies to do what they otherwise cannot, to make possible what is otherwise impossible. The COVID pandemic was a crisis that required a first-of-its-kind invention that no company could solve on its own. It was inconceivable that a single firm might invent, test, approve, and manufacture a therapy in record-breaking time. In the case of mRNA technology, an ingenious invention wasn’t enough. We needed an equally ingenious plan to bring that invention to life. And, just as the US government did for penicillin in World War II, the US succeeded by providing a model for how to turn invention into implementation.

This may be the moment for a politics of abundance. But the arc of history does not always bend toward our beliefs. There is no guarantee that the next political order will align with our values. Its opposite is just as likely. The politics of scarcity can be seductive. When there is not enough to go around, we look with suspicion on anyone who might take what we have. In the 2024 election, JD Vance spoke often of the inadequacy of housing supply, which he wielded as a cudgel against immigrants. “Illegal aliens competing with Americans for scarce homes is one of the most significant drivers of home prices in the country,” he said in the vice presidential debate.8 Donald Trump sounded the same themes. Voters “cannot ignore the impact that the flood of 21 million illegal aliens has had on driving up housing costs,” he warned.9

Right-wing populism seeks power by closing doors, halting change, and venerating the businesses and dominance hierarchies of the past. Scarcity is its handmaiden. So too is the sense that governments today are weak and corrupt and, therefore, that strongmen are needed to see the world clearly and deliver on democracy’s failed promises.

As the chronic housing shortage and affordability crisis destabilized the reigning political order internally, America’s greatest external threat has been the rise of China, a superpower that many now fear and even envy. How could they build so much as we struggled to complete even simple projects? As sluggishness and process came to feel like the defining features of American governance, it became common, even at the heights of American power, to hear China’s speed and capacity spoken of wistfully. “Sit and watch us for seven days—just watch the [Senate] floor,” Senator Michael Bennet said in 2010. “You know what you’ll see happening? Nothing. When I’m in the chair, I sit there thinking, I wonder what they’re doing in China right now?”11

Trump slapped tariffs on China and called Covid the “Kung Flu,”13 but he did little to solve the problems he ran on. He promised one “infrastructure week” after another without ever passing an infrastructure bill. Trump understood the dark side of competition, but he never understood the possibilities of cooperation.

“Somewhere along the way, we stopped investing in ourselves,” Biden said in 2021. “We stopped investing in our people. And we’ve risked losing our edge as a nation. I don’t even think it was conscious, but that’s just what’s happened. And China and the rest of the world are moving to catch up and, in some cases, in certain areas, move ahead.”17 Under Trump, “infrastructure week” was a meme. Under Biden, it became an ethos. In his four years in office, Biden put his name to several laws that broke with the anti-build trend of modern politics. With the bipartisan infrastructure bill, he signed the largest authorization of infrastructure spending since the Interstate Highway program of the 1950s.18 With the CHIPS and Science Act, he announced America’s intention to invest billions of dollars in scientific discovery and invention—and tens of billions more to build advanced computer chips within our borders.19 With the Inflation Reduction Act, the US passed the largest clean energy bill in its history, with record investments in electric vehicles, batteries, solar and wind manufacturing, and next-generation climate technology, such as carbon-removal plants.20 The core of this agenda—subsidies for computer chips and clean energy, historic investments in infrastructure—used the spur of China to get America building and manufacturing at home again. As in the 1930s, and again in the 1970s, external threats and internal crises are converging and making possible a new kind of politics.

The infrastructure bill, for instance, included $7.5 billion to build a national network of 500,000 electric vehicle charging stations; by March 2024—more than two years after the bill passed—only seven new chargers were up and running.22 The bitter irony is that Trump and the Republicans might benefit from legislation Biden and the Democrats passed simply because the government spends and builds so slowly, so the changes Biden promised will now happen on Trump’s watch.

“This is what democracy looks like” is a common chant at protests, but what democracy should look like is a devilishly hard question to answer.

What we are proposing is less a set of policy solutions than a new set of questions around which our politics should revolve. What is scarce that should be abundant? What is difficult to build that should be easy? What inventions do we need that we do not yet have?

Political movements succeed when they build a vision of the future that is imbued with the virtues of the past. In the 1930s, Franklin D. Roosevelt pitched his expansive view of government as a sentinel for American freedoms—of speech, of worship, from want, from fear. Five decades later, Reagan hailed the same virtues, this time by casting government as freedom’s nemesis rather than its protector.