In the 1980s, Washington policymakers faced an intractable
problem: Acid rain, fueled by pollutants from coal-fired power
plants, was ravaging lakes, streams and forests and endangering
wildlife, especially in the Northeast. President Ronald Reagan,
siding with the coal industry and utilities, chose to study the
problem. But when George H.W. Bush was elected president, he
embraced a novel approach. He would allow power plant operators
to buy, sell and trade credits to pollute - as long as they cut
overall emissions in half. "We will allow flexibility in how
industry achieves these goals," Bush told lawmakers and business
leaders gathered at the White House on June 12, 1989. "But we
stand firm on what must be achieved." Nearly two decades later,
the acid rain program the Republican president crafted with a
Democratic Congress - and over the opposition of many
environmental groups - has emerged as the model for efforts to
fight global warming worldwide. Europe's carbon trading market
is based on it. California