The Big Money

Unlike a carbon tax, a cap-and-trade system for curbing carbon dioxide creates huge windfalls for lucky winners. Cap-and-trade creates a new currency: carbon emission rights. The Obama administration's budget plans call for selling these rights. Then the plan met the giant favor-selling enterprise we know as the U.S. Congress. The carbon bill emerging from Henry Waxman's committe will give away most of these rights, probably almost all of them - a gift potentially worth hundreds of billions of dollars. 

My new column for The Week tries to suss out who the lucky beneficiaries will be. Hint: They tend to be located in states represented by Democratic members of Congress. Double hint: Ask your broker to check out Green Mountain Power in Vermont, which stands to make a packet!

The story is complicated. But in Washington, complication is how big money grabs conceal themselves .... So pay attention. It's your money, ultimately.

The column NB contains one over-simplification. I talked about rights being conferred upon local power generators. In fact, the rights are conferred upon power distributors. In many states, power distributors and power generators are integrated into a single utility company. But not always, and I should have been clearer on that point.