[Veratyr]

The first part doesn't work so well without the second part (buses are terrible on congested roads) and the second part is unlikely to work well without the first (who'd accept that tax?).

Really, you'd need to do these both at once and getting support for such a thing would be extraordinarily difficult without it being proven first.

Also, I doubt it could work as well or better than trams/streetcars in dense areas. I mean the model used by trams/light rail in European cities (the one that comes to my mind is Zurich) rather than that used by Muni. In Zurich there's a stop every 2-3 blocks and it'll usually have a tram coming within a few minutes. I've seen cities were a wait longer than 3 minutes during the day is rare.

A bus like you describe would certainly be more convenient (it can turn and go down streets without rails, as well as come to pick me up) but I'm not sure it would be better overall (the pickup costs time that's lost by the current passengers of the bus for example).

[Houshalter]

What's the difference between a tram and a bus? Rails? Dedicated stops? Having to share the route with other vehicles?

Well we could solve the second two problems, and not needing rails seems like an advantage.