Conning the Climate: Inside the Carbon-Trading Shell Game. By Mark Shapiro, Harpers, February issue. "Carbon trading is now the fastest-growing commodities market on earth. Since 2005, when major greenhouse-gas polluters among the Kyoto signatories were issued caps on their emissions and permitted to buy credits to meet those caps, there have been more than $300 billion worth of carbon transactions. Major financial institutions such as Goldman Sachs, Barclays, and Citibank now host carbon-trading desks in London; traders who once speculated on oil and gas are betting on the most insidious side effects of our fossil fuel-based economy. Over the next decade, if President Obama and other advocates can institute a cap-and-trade system in the United States, the demand for carbon credits could explode into a $2 to $3 trillion market, according to the market-analysis firm Point Carbon...
"Carbon exists as a commodity only through the decisions of politicians and bureaucrats, who determine both the demand, by setting emissions limits, and the supply, by establishing criteria for offsets. It was the United States that sculpted the cap-and-trade system during the Kyoto negotiations, before pulling out of the accord and leaving the rest of the world to implement the scheme. Since then, most of the world's major political, financial, and environmental interests have aligned themselves with the idea, because of its potential to generate profits out of adversity and to avoid the difficult economic decisions posed by climate change. Now the Obama Administration and the Democratic Congress -- along with most American companies, which see cap-and-trade as the friendliest regulation they could hope for -- want to rejoin the world and multiply the market. That market is, in essence, an elaborate shell game, a disappearing act that nicely serves the immediate interests of the world's governments but fails to meet the challenges of our looming environmental crisis."
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