The world embraces carbon trading but ignores the very real dangers about conflicts of interest that will undermine any cap and trade scheme. And these are exactly the same sort of conflicts that created the financial meltdown.
Deutsche Welle reports that in Germany, auditors have already been suspended because of concerns that "undue pressure" might have influenced their recommendations.
The problem with carbon trading schemes is that the auditors' payment comes from the development projects themselves. This is similar to financial markets where credit rating agencies were paid by companies issuing shares on the market, an outright conflict that led to outfits like S&P, Fitch and Moody's giving AAA ratings to securities that were dogs.
As Friends of the Earth pointed out two years ago, we could see carbon markets, with all their cozy arrangements, triggering a second 'sub-prime' style financial collapse and fail to protect the world from global warming.
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