I'm not sure on that one. The Liberals here in Canuckistan proposed a carbon tax this summer that skipped over gasoline, but it's still pretty damn unpopular. Both the left and right have been hitting them with the basic message that "when energy prices are already high, you want to raise them even higher, you horrible bastards". The gasoline issue is effectively sidestepped, and you're left with the unarguable case that, yes, you are raising the price of energy.

Another thing that has emerged from the focus on power generation (rather than transportation fuel) as a source of emissions is that it leads to regionalised concerns and interests. Here in Alberta, fossil fuels are used for approximately 90% of generation. Pretty much all of B.C. and Quebec's power is generated from hydro, so not so concerned about increasing bills there. Everyone drives, but not everyone will see their power bill go soaring.

I wouldn't take this cold reception as the death knell for a carbon tax, however. Putting a price on carbon is relatively new policy. We don't really know what we're doing, or how to sell it. Over time, one would have thought that we'll get better at it, and get it done.

I don't think that timeline provides much in the way of reassurance for the polar bears though.

The ideal solution is a variant on the cap-and-dividend approach: give a tax credit for the estimated cost of carbon fees, but only for gas used for individual transportation averaged over the entire country. This threads the political needle of defusing outrage while funding projects with the remaining carbon fees.

Also, $28/ton sounds low to me. I think I've seen higher figures.

As to the graph, fuels processing and waste management also involve gasoline/diesel (maybe power production too).

Finally, if climate change turns out to be worse than expected, we're better off getting a carbon fee structure set up so we can escalate as needed.

We're either going to cap CO2 emissions or the planet is going to fry. To leave gasoline out due to political considerations probably means we lack the political will to do anything at all. Explain that to your kids.

I'd be worried about starting to carve out exceptions to a carbon tax (or cap). Would it work to have the carbon tax apply to gasoline just like everything else, but to get rid of the existing gas taxes? The federal government could send some of its carbon tax revenue down to states & local governments to make up for what they'd lose from current gas taxes.

It makes sense from a bang-for-the-buck policy perspective. However, gasoline consumption is the only major CO2 source that average individuals can influence through daily choices. Take gasoline off the table and it becomes completely separate from Joe Sixpack's daily life.

It also doesn't help that Democrats have spent years rhetorically joining global warming and Big Oil Profits at the hip. Any CO2 reduction measure that isn't perceived as coming right off Exxon's bottom line can and will be demagogued as a "subsidy to Big Oil".

If the legislation couples gas tax increases ( or implicit increases due to auctioned cap and trade limits ) to decreased payroll or income taxes, the consumer may be mollified, and maybe even educated.

What you are suggesting is, subsidizing gasoline. You really think that's the best you can come up with?

Anyway, the coming depression will reduce both gas consumption and prices all on its own. Political equations will change. People will have more pressing problems than gas prices. They already have more pressing problems. If a new administration fixes health care and invests in green infrastructure, thereby creating millions of jobs, people won't mind paying a bit more for gas. This is not the moment for defensiveness. This is the historical moment when good policy might actually have a chance. But not if we already surrender in advance.