By Michael Shellenberger and Ted Nordhaus

Since he launched his campaign for president in 2007, President Barack Obama has promised legislation that would deliver more clean energy jobs through the creation of new and larger clean energy industries, like solar and wind manufacturing, to drive future economic growth. In June, Obama claimed climate legislation that passed the House of Representatives “will create a set of incentives that will spur the development of new sources of energy, including wind, solar and geothermal power.”

But analyses by the Environmental Protection Agency, the Union of Concerned Scientists, the Breakthrough Institute and others show that the Waxman Markey climate legislation will not significantly grow the number of clean energy jobs or industries. The EPA analysis released on the same day as Obama’s speech shows the deployment of renewables could be less than without the legislation. An analysis of the renewable energy standard (RES) provision of the legislation by the Union of Concerned Scientists (whose model of various RES exemptions is the most thorough) finds the legislation could actually require less renewables deployment than projected to occur under the U.S. Energy Information Administration’s conservative business-as-usual forecasts. And EPA says the impact of the legislation on gasoline prices ($0.13 a gallon in 2015, $.25 in 2030) will be too small to motivate consumers to drive less or buy smaller cars, or provide incentive for the automotive industry to produce more fuel efficient and technologically advanced vehicles like plug-in hybrid cars.

While the White House web site still promises $15 billion annually for clean energy R&D alone, the House climate legislation would invest just $800 million to $1.4 billion in R&D. Total investments in clean energy, defined broadly, are likely to be just $6 to $9 billion annually between 2012-2025, in contrast to the $30 to $60 billion annually that will be transferred to utilities, coal-fired power plant operators, oil refiners, natural gas distributors and heavy industry under the bill, and the $15 to $30 billion annually that would flow overseas to pay for international offsets, if they are utilized at the full levels permitted by the legislation.

Leading energy experts sent a letter to President Obama and members of Congress calling for a massive increase in money set aside in the climate legislation for energy research and development. Quoting President Obama’s statements calling for a vibrant national clean energy industry, the scientists write that “Large public investments in technology innovation have been critical for establishing America’s leadership in the aerospace, computer, Internet, and pharmaceutical industries—and they will be critical to establishing America’s leadership in clean energy.”

The legislation will be voted on at a time when China, Korea and Japan are all investing large sums to create domestic clean energy industries. China will invest $300 to $600 billion over the next 10 years in solar, wind, nuclear power, high speed rail and electric cars. South Korea, with an economy one-tenth the size of the U.S., has pledged to spend $40 billion over the next four years on renewable energy programs. And Japan, which already leads the world in hybrid engine and solar panel technologies, has pledged to cut its domestic reduction of carbon emissions, already among the lowest in the world on a GDP per capita basis, a further 15 percent by deploying renewable energy technology. The three nations meet this month to develop a strategy to combine China’s low-cost manufacturing the Korea and Japan’s engineering know-how.

There is a better way. We propose an alternative cap and trade, which would explicitly cap the price of carbon dioxide pollution at roughly $10 a ton, rising over time; would auction all pollution allowances with no free giveaways and no offsetting; and would use the vast majority of the revenues—about $60 billion a year—to fund the accelerated development and deployment of clean energy technologies. We believe that such a solution would more rapidly achieve the technological innovations we need at a lower cost. It is also great politics, given strong public support for government investment in clean energy technology.

Meeting the global climate challenge will require us to rapidly and completely decarbonize the global energy economy. This will require that we do so not only in the United States, but also in places like China and India where most of the growth of future carbon emissions will come from. These developing nations and others like them require affordable and abundant energy in order to continue their rise from poverty. While clean energy technologies have made great advances in recent decades in terms of price and performance, they simply remain too expensive compared to fossil fuels. Yet as recent developments in both the U.S. Congress and international negotiations have made clear, the public in neither the U.S. nor China and India are willing to pay much (if anything) more for cleaner alternatives.

As such, the central objective of U.S. climate and energy policy must be to rapidly drive the real, unsubsidized costs of clean energy technologies down as rapidly as possible to make clean energy cheap. We support regulations, including a cap and trade system, provided they are designed with this critical objective in mind and effectively support energy technology innovation. We do not, however, imagine that these measures will be the primary mechanism through which the radical technological innovation necessary to achieve urgent reductions in global carbon emissions will occur. For this, we will need epic—and in many cases direct—public investment at every stage of the research, development and deployment process. This approach is both good policy and good politics.

Americans overwhelming support direct government investment in innovation to make clean energy cheap.

Ted Nordhaus and Michael Shellenberger are authors of Break Through and co-founders of Breakthrough Institute, a think tank.