There once was a time when the government relied on a very blunt way of regulating the economy. It told companies and individuals what they could do and what they could not do. These were the days of command-and-control regulation.

But then came the market revolution of the last three decades. With the Soviet empire collapsing, the United States economy growing more rapidly than Europe’s, and newly market-friendly China and India booming, people saw the drawbacks of command and control. Governments were usually better off avoiding outright bans and instead giving people incentives to behave in productive ways.

The classic example was environmental policy.

Most famously, a 1990 bill signed by the first President Bush forced coal plants to buy permits if they were going to emit the sulfur dioxide that caused acid rain. With the price of emissions suddenly higher, the plants looked for innovative ways to reduce pollution  and succeeded more rapidly and cheaply than experts had predicted.

This history is the basic argument for putting a price on carbon today, and the next several weeks are likely to determine whether that happens. The chances of Congress’s passing a permit  or cap-and-trade  system that applies to the whole economy are low. But it could still create a version that covered power plants, if not factories and transportation. That would be no small thing.