Carbon's Future King

The Chicago climate Exchange is the world's first voluntary carbon credit market. Members get credits for reducing emissions and buy them if they fall short of pledged goals. NEWSWEEK's Jesse Ellison talked to its founder, Richard Sandor. Excerpts:

ELLISON: Everyone assumes the United States lags the rest of the world in cutting emissions. True?
SANDOR: Europe's not as far ahead as people think and America's not as far behind … Our baseline is 550 million tons, Europe's is 2 billion, so actually we're 25 percent the size of Europe.

How can you be sure that companies are cutting emissions?
I called the Financial Industry Regulatory Association and said, "You're going to be really surprised. I want you to regulate us." [They] do spot audits.

Will there eventually be a global, regulated market?
In the absence of a federal policy, we invent a policy. In Canada, we'll do what the Canadians want. In India, we will cater it to Indian culture. Even though it's a global problem, you've got to let each country set its own standards. You can't let the perfect be the enemy of the good.