June 14, 2009.  Carbon-emission caps generate risky prices, so their designers build in "safety valves," one way or another. The EPA has found that Waxman's cap will cut our emissions 29% by 2050 instead of the claimed 83%.

Foreign offsets account for most of the discrepancy. Not only will emitters buy nearly 1.5 billion foreign offsets in 2050, but they will bank such offsets starting in 2012 for use in later years. Banking can nearly double the offset effect in 2050.

Foreign offsets they have several drawbacks. First, the money paid for allowances can be recycled to consumer dividends, green investment, or to pay off the national debt. Not so with the $13 to $83 billion a year we will be sending to China or wherever.

If offsets were a cheaper way to reduce carbon, then it might be worth it. But the foreign offset programs tend to be corrupt. Even the Danish company that serves as the U.N.'s most trusted watchdog got suspended for not watching last December. But what's worse is that China and all developing countries will think, "If we commit to a cap or a carbon tax, we will need all our best offset projects to meet our own commitment and we so that will cut into our offset profits." This is one reason developing countries will not make binding commitments.

China and India have nixed caps. Without these caps, Kyoto fails. What can be done?

Carbonomics explains "wrecking" the economy, "peak oil," caps, carbon taxes, and Kyoto.