To begin with, CAP's agents will have to go to every factory and office building, presumably even public buildings, and decide their allowable levels of emissions -- that is to say, their caps. Next, the agency will auction off and oversee the sales of the documents that certify emissions allowances. Call them coupons. Then the agency will have to monitor the exchanges of these allowances and who owns them. Finally, the agency will have to monitor compliance and presumably punish those who fail to comply.
In this setup, there will be countless opportunities for corruption, as polluters try to bribe CAP's agents or the agents try to elicit bribes. As with the SEC, there will be incompetence and lax enforcement. Finally, there will be members of Congress making special pleadings for corporations in their regions, labor unions -- special pleaders of all sorts.
Finally, there is the economics of the legislation. It will take $2 trillion from the private sector and dump it into the public sector. That is to say, a large tax on the private sector will transfer money to the public sector. So how is the private sector to grow itself out of this recession? The administration's answer is that the government will return the money to worthy endeavors, e.g., health care and green technology -- again, still more opportunities for corruption and for special favors to pleading solons and Numas on Capitol Hill.
The Prophet Obama was very disturbed recently when asked whether he is a socialist. Socialism is government control of the means of producing and distributing goods and services. What I have just described is a powerful instrumentality toward socialism. Along with cap and trade, the Obama administration is calling for a sufficient number of these instrumentalities to socialism; by the next election, the United States will be very close to being a socialist state. There is no point in Obama arguing against that observation. He ought simply to come out and say it. He is for socialism. What could possibly be wrong with that?