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A dynamic duo's new cause

Susan Freinkel | May 16, 2012 | Lifestyle Story City Life Profiles

They’re cofounders of the Breakthrough Institute, a think tank in Oakland devoted to environmental issues, and their challenges to conventional wisdom on climate change (in short: carbon taxes, bad; doomsday scenarios, unhelpful) once earned them the inglorious nickname “the bad boys of environmentalism.” Now, at their second annual Breakthrough Dialogue, beginning June 28, they’ll be training their contrarian eyes on some other hot topics, including the Warren Buffett–fueled issue of the moment: social inequality. Here’s a preview of some of the sparks likely to fly among the 150 academics, Institute fellows, and journalists in attendance.

San Francisco: I gather that you don’t agree with the Occupy Wall Street rhetoric.

Michael Shellenberger: It makes for good protest politics, but framing the problem as 1 percent vs. the 99 percent is adolescent. It makes a hard problem look easy. We’re concerned about the idea that if the 1 percent were just taxed more, you’d have less inequality and a more robust social safety net. It doesn’t add up.

Ted Nordhaus: Actually, the evidence suggests that what has the most impact on both inequality and social mobility is having a generous social welfare state.

SF: So why wouldn’t a million­aire’s tax, à la the Buffett rule, help support that?

: I’m happy to pass the Buffett rule and to get rid of the Bush tax cuts and do all sorts of things like that. But
you need a much broader tax base. That’s why almost everywhere in Europe—particularly in the northern countries—where inequality is significantly lower, the lion’s share of revenues are raised through a national sales tax.

SF: But doesn’t that regressive kind of tax hurt the poor and middle class?

: The regressivity of your tax isn’t just about how you raise the money—it’s also about how you spend it. In Europe, they have a more regressive tax system, but they spend the money progressively. Almost everybody pays higher taxes, but they get higher benefits and services in return.

SF: This sounds like it would be heresy to the right and the left! Can we still call you liberals?

MS: We’re truly in the liberal tradition: a strong role for government, a concern about inequality, and a love of progress, technology, and science. What’s more progressive than that?

SF: OK, but how would we ever get liberals and conservatives to agree on something like a national sales tax?

MS: Sure, it would take years and would require the types of conversations that are taboo in this country—conversations about taxing everyone.


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