There is beginning to be quite a huff over carbon offsets. Most recently there is this post at Ecotality claiming that carbon offsets purchased by Al Gore and John Edwards are nothing more than hypocrisy. The post states that Gore and Edwards should change their behavior rather than "offset" their consumption.
I think there is a legitimate debate about whether carbon offsets actually reduce emissions. See for instance, this post at Marginal Revolution. However, I think it is one of environmental economics' largest contributions to the pollution debate to note that not all of us have to reduce our pollution equally. If Al Gore wants to have a big house and pay the requisite fees to reduce emissions somewhere else, that is all right with me. Me? I'd prefer to take the bus, fly commericial rather than on my private jet and live in a smaller house.
Let me repeat that. I do NOT think we should all live the same lifestyle. I think that as long as people are paying the full cost of their lifestyle, people should be allowed to choose how they would like to live their life. The problem now is that we are not paying the full cost of our actions.