November 2010 Pays Dividends: We Avoided a Cap-N-Trade Disaster

In 2008, I said let's let Europe's cap and trade experiment play out a little before we rush headlong into a similar scheme.

I'll say it again, let's stay well behind the Euros and see if these schemes actually work or drive the economy over a cliff before we do anything.

Turns out this was wise advice, although I think we avoided this pitfall mostly by accident rather than out of prudence.

Back in 2005, the European Union launched its Emission Trading Scheme (ETS), and as the New York Times reported on Sunday, it is failing spectacularly. Why? Because of "serious flaws in the design of the system," as The Times writes. It goes on to say:

This year has been stomach-churning for the people who make their living in the arcane world of trading emissions permits. The most recent volatility comes on top of years of uncertainty during which prices have fluctuated from $40 to nearly zero for the right to emit one ton of carbon dioxide.

Thank the Tea Party and Joe Manchin's rifle.