The latest Smithsonian magazine has an in-depth piece that tells the story of "How an unlikely mix of environmentalists and free-market conservatives hammered out the strategy known as cap-and-trade."

The story is powerful — it starts with a hike,  leads to fury within the Bush White House and ends with results:

Almost 20 years since the signing of the Clean Air Act of 1990, the cap-and-trade system continues to let polluters figure out the least expensive way to reduce their acid rain emissions. As a result, the law costs utilities just $3 billion annually, not $25 billion, according to a recent study in the Journal of Environmental Management; by cutting acid rain in half, it also generates an estimated $122 billion a year in benefits from avoided death and illness, healthier lakes and forests, and improved visibility on the Eastern Seaboard. (Better relations with Canada? Priceless.)

…

Cap-and-trade — a term that first appeared in print that year — quickly went "from being a pariah among policy makers," as an MIT analysis put it, "to being a star — everybody's favorite way to deal with pollution problems."