The European Union’s carbon emission cap and trade policy is a colossal failure. It’s failure has not only been well documented, but has also been admitted by key EU climate leaders. When the EU tried to address the failure of their cap and trade system the price of carbon only fell further and by the end of 2007, EU carbon emissions had only risen again.

At the core of cap and trade’s failure is the impossibility of verifying reductions in carbon to the point that they can then be commodified. New Zealand’s Bryan Leyland put it best:

So, to my knowledge, carbon trading is the only commodity trading where it is impossible to establish with reasonable accuracy how much is being bought and sold, where the commodity that is traded is invisible and can perform no useful purpose for the purchaser, and where both parties benefit if the quantities traded have been exaggerated. … It is, therefore, an open invitation to fraud and that is exactly what is happening all over the world.

And it just gets better from there. Not only does cap and trade not reduce carbon, it will also wreck the U.S. economy. Complying with Kyoto mandates would cost as much as 4% of GDP. Worse, even if Kyoto’s targets were met the Earth’s surface temperature would be reduced by an imperceptible 0.14°F per 50 years.

So to recap: cap and trade does not reduce carbon, it harms the economy, and it would do nothing to affect global temperatures. No wonder there is a growing scientific movement to move beyond costly and ineffective mandatory caps and towards adaptation.

The White House, however, is unfazed by all these facts. The Washington Times reports that President Bush “is poised to change course and announce as early as this week that he wants Congress to pass a bill to combat global warming.” And we hear that he will endorse a cap and trade approach. We are sympathetic to Administration claims that current law has created a regulatory train wreck, but the answer to that problem is to stand on principle and reform those badly misguided laws.