The Journal on McCain’s speech yesterday:

So a chemical manufacturer, say, would pay an industry not covered by the program – most notably, agriculture – to reduce its emissions. Or it could pay a coal plant in China for plucking low-hanging efficiency fruit, like installing smokestack scrubbers. In other words, U.S. consumers would be paying higher prices for energy in return for making Chinese industries more efficient and competitive. Europe is in the midst of that experience now under the Kyoto Protocol, and most of its reductions so far have been illusory.The compliance bookkeeping for this new “market” is vastly complex, and a McCain Administration would create a public-private “Climate Change Credit Corporation” to oversee it all. This new regulatory body is likely to morph over time into an “Energy Fed,” similar to the one Warner-Lieberman would create. Such an agency would set the price of energy indirectly by fiddling with carbon levies, which will undoubtedly lead to economy-wide distortions.