Cap and trade is something I have blogged about for a few years as a travesty of an economic policy designed to enrich the rich and impoverish the poor while not helping reduce carbon emissions. This great YouTube video has been produced by Annie Leonard and explains the problem to non-economists.
The only issue with the video is that Annie does not fully understand just how the Cap & Trade system would enslave humanity. This is because we would create new energy monopolists (a bit like today's landowners) that would own nearly all of production in perpetuity, owning the right to pollute and renting it out to humanity who would have to pay them for the privilege of economic activity and prevent a free market in energy and manufacturing. Today's large polluting companies (or to be more precise their shareholders) would at a stroke become hereditary barons, milking humanity for the rest of time of their productive labour.
The real solution is to tax carbon at source and redistribute this money amongst all of the worlds people equally (thus eliminating global poverty, hunger and taking away the main reason for international war) or just introduce a Land Value Tax which would achieve a similar result.
A witty economist said this of it:
"If you want to keep a donkey healthy you don't regulate what comes out of it, you regulate what goes in"