Carbon Offsetting vs Rising Tide

Activists from the campaign group Rising Tide occupied the offices of the CarbonNeutral Company last week, saying they were "working away from solutions to climate change", by putting up the smokescrean of carbon offsetting. A CarbonNeutral spokewoman responded by saying "Rising Tide have never asked to meet us, so we don't know what they do, and I don't think they know what we do. What we do is help companies measure and reduce their emissions; and where they can't reduce their emissions, we help them offset. So we're a carbon management company, not a carbon offsetting company."
However, though there seems to have been some confusion here, there is certainly some debate carbon offsetting. At first consideration, there seems to be a clear and sound economic argument that goes on these lines: as i reduce my emissions, the first ten percent is the easiest to reduce, the next ten is harder, the next even harder, and so on, until i get to the situation where i have reduced all possible emissions, except the final 1% - breathing. Thus, if i have a limited amount of time and resources that i am prepared to put into reducing my carbon footprint, it makes most sense to reduce my emissions as much as possible, and then pay other people to reduce theirs.
Why then are climate change activists so against this type of solution? A new website has been launched called www.cheatneutral.com, which allows people to offset every time they want to cheat on their partner by paying someone else to remain faithful, so keeping the amount of fidelity in the world neutral.
So, are carbon offsets really just a modern day indulgence that allows us to continue polluting, or are they a useful way to tackle climate change?