A DANGEROUS OBSESSION

The report argues that carbon trading is a fundamentally flawed mechanism that fails to drive real emissions reductions or technological innovation, instead creating risks of financial speculation and locking economies into high-carbon infrastructure. It specifically critiques the use of offsetting as an unjust 'escape hatch' that shifts responsibility from developed to developing nations. The authors advocate for a shift toward direct government interventions, including carbon taxation, strict regulation, and massive public investment in low-carbon infrastructure, while calling for developed countries to provide at least €200 billion per year in new and additional climate finance to the global South.

• Carbon trading is ineffective at achieving promised emissions reductions and fails to drive the technological innovation required for a low-carbon transition. The first phase of the EU ETS (2005-2007) is described as a complete failure, and Phase II is viewed as likely to follow a similar path due to the over-allocation of permits.
• The mechanism of carbon trading creates a 'lock-in' effect for high-carbon infrastructure by incentivizing the lowest-cost adjustments first and allowing highly polluting firms to avoid expensive structural changes by purchasing cheap credits.
• Offsetting is characterized as a profoundly unjust and flawed tool that allows developed countries to avoid domestic emissions cuts by paying for reductions elsewhere, often failing to deliver actual emissions cuts and potentially causing social and environmental harm.
• The complexity of carbon markets and the high level of involvement by financial speculators create a risk of a speculative commodity bubble, which could lead to a global financial crisis similar to the subprime mortgage crisis.
• Developed countries use the prospect of carbon market finance as a 'smokescreen' to avoid their legal obligations under the UNFCCC to provide new and additional finance to developing countries, resulting in 'double counting'.
• The report argues that the push for global carbon trading, particularly by the UK and EU, is driven by the financial self-interest of industry and finance sectors that have already invested heavily in these systems.
• Direct government interventions—specifically taxation, regulation, and public investment—are proposed as more effective and proven alternatives to the indirect mechanism of carbon trading.
• To address global inequality, the report demands that developed countries provide at least €200 billion per year by 2012 in new and additional public funds for mitigation and adaptation in developing countries.

APA

Clifton, S.-J. (2009). A DANGEROUS OBSESSION. Friends of the Earth International. https://www.foei.org/wp-content/uploads/2020/12/dangerous-obsession-full.pdf

Chicago

Clifton, Sarah-Jayne. A DANGEROUS OBSESSION. Friends of the Earth International, 2009. https://www.foei.org/wp-content/uploads/2020/12/dangerous-obsession-full.pdf.

Wikipedia

{{cite report |last1=Clifton |first1=Sarah-Jayne |title=A DANGEROUS OBSESSION |publisher=Friends of the Earth International |date=November 2009 |url=https://www.foei.org/wp-content/uploads/2020/12/dangerous-obsession-full.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{clifton2009dangerous, author = {Clifton, Sarah-Jayne}, title = {{A DANGEROUS OBSESSION}}, institution = {Friends of the Earth International}, year = {2009}, month = nov, url = {https://www.foei.org/wp-content/uploads/2020/12/dangerous-obsession-full.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }