That having been said, I still believe it's a good idea to try to minimize our unintended impact on the Earth's environment, and providing some incentives to business to reduce their carbon footprint (as well as other unintended environmental footprints) does make sense. Krupp is proposing a cap and trade system, which makes a lot of intuitive sense to me, provided that ALL countries, including developing countries, subscribe to the same standards, and this unfortunately is unlikely. (Otherwise, all we're really doing is handicapping our own businesses, and we'll just be exporting jobs and pollution to non-participating countries, like China and India.)

To combat the problem of acid rain the sulfur dioxide cap and trade system was very successful, reducing SO2 emissions by 50%, ahead of schedule. A cap and trade system makes it possible to profit by reducing pollution, and the reason the SO2 system worked so well and performed ahead of plan was that companies found ways to cut pollution even more than the pollution they were responsible for. They made a profit by cutting pollution. But SO2 is a real pollutant, while CO2 is not. CO2 is found naturally in the atmosphere already, where as SO2 is an unnatural by-product of man-made manufacturing processes.

Krupp had an impressive list of interesting and innovative companies making steady progress in geothermal, solar, and other green technologies. It really is a high-activity domain, and he said more environmental innovations can be reviewed on the Environmental Defense Fund's Web site www.innovation.edf.org.

Unfortunately, Krupp lumped ethanol in there with the list of all the other solutions. I guess he didn't see the news reports that analysis has now revealed ethanol may actually do more environmental damage than good. It encourages deforestation as well as consuming too much energy in production, so the offsets to the good it does by replacing fossil fuels are quite substantial. Moreover, even if 100% of the corn produced today in the United States went to ethanol production, it would only supplant about 5% of our need for petroleum products. I would have appreciated a bit of a discussion on this point from a guy like Fred Krupp, who should be familiar with the argument.

There's no doubt that a lot of money will be made by a lot of companies if a cap and trade system is adopted in this country. But whether this will be good for the world or not, and whether this will be truly productive for the economy or not, is an open question. Just prior to the first Kyoto conference, a whole assortment of US companies were piling onto this same bandwagon, and many were deeply disappointed that the US did not subscribe to the Kyoto Protocol, after all.

One of the companies that bet very big on the passage of Kyoto was Enron. But while Enron was getting ready to make a market in carbon credits the same way it made markets in natural gas and other energy issues, they knew that once Kyoto became the standard in the developed world, the price of dirty coal would fall, and so they already had plans to take advantage of that by were investing heavily in dirty coal power plants to be built in less developed countries where there would be no restrictions. This may sound cynical to us today, and Enron's negative reputation may give us an excuse to blame them, but the truth is all they were doing was trying to make money by arbitraging the Kyoto restrictions.

So if we don't want this to happen, then cap and trade has to be a universal system, not one that is implemented only in the US and Europe. This may mean that the developed countries will have to compensate the developing world in some way to ensure their subscribing to the same restrictions, and this will increase the burden of the whole enterprise. But that's just the reality, unfortunately.