I think Chris is probably taking Taubes a bit literally (and I agree with the revenue-cost analogy), but I like http://wholehealthsource.blogspot.com/2011/08/carbohydrate-hypothesis-of-obesity.html , which he linked to in Part 1. There's quite a lot in it about insulin (too much for me to summarize here), but I've copied a couple of particularly relevant paragraphs below. Obviously if you can see any issues with them then I would be interested in hearing them.
"The idea of fat gain in insulin-treated diabetics (argument #3) is not as airtight as it might at first seem. On average, diabetics do gain fat when they initiate insulin therapy using short-acting insulins. This is partially because insulin keeps them from peeing out glucose (glycosuria) to the tune of a couple hundred calories a day. It's also because there isn't enough insulin around to restrain the release of fat from fat cells (lipolysis), which is one of insulin's jobs, as described above. When you correct this insulin deficiency (absolute or relative), obviously a diabetic person will typically gain weight. In addition, short-acting insulins are hard to control, and often create episodes where glucose drops too low (hypoglycemia), which is a potent trigger for food intake and fat gain.
"So what happens when you administer insulin to less severe diabetics that don't have much glycosuria, and you use a type of insulin that is more stable in the bloodstream and so causes fewer hypoglycemic episodes? This was recently addressed by the massive ORIGIN trial (17d). Investigators randomized 12,537 diabetic or pre-diabetic people to insulin therapy or treatment as usual, and followed them for 6 years. The insulin group received insulin glargine, a form of long-acting "basal" insulin that elevates baseline insulin throughout the day and night. In this study, insulin treatment brought fasting glucose from 125 to 93 mg/dL on average, so it was clearly a high enough dosage to have meaningful biological effects. After 6 years of divergent insulin levels, the difference in body weight was only 4.6 lbs (2.1 kg), which is at least partially explained by the fact that the insulin group had more hypoglycemic episodes, and took less metformin (a diabetes drug that causes fat loss). A previous study found that three different kinds of long-acting insulin actually caused a slight weight loss over three months (17e). This is rather difficult to reconcile with the idea that elevated fasting insulin is as fattening as claimed."
Edit: Fixed link.
Then it's a good example, and I'm with you that your weight is determined by more than whether you have the willpower to say "today I'm going to exercise and not eat too much". (Though most researchers probably agree with Taubes on this: http://wholehealthsource.blogspot.com/2013/01/comment-in-nature.html .)
I think Stephan on Whole Health Source does a good job of refuting Taubes' claims on the particular importance of insulin resulting from carbohydrate consumption (I can't remember specific posts, but I think there are several others in addition to the one Chris linked to), but it might be that I would think otherwise if I were a bit more knowledgeable. He had some sort of falling out with Taubes at some point, and, like Taubes, he has a theory about what causes obesity (http://wholehealthsource.blogspot.com/2011/11/brief-response-to-taubess-food-rewad.html) and is presumably disproportionately likely to interpret evidence in ways that support his theory.