[jogjayr]

> We HOPE drivers will drive less if the carbon tax hits their pocket book, but there is no guarantee.

Gasoline costs twice as much in India as the US, and the average income is far less. People drive a lot less, use public transport, build more densely, and purchase more economical vehicles - small cars, motorcycles, scooters. Liquefied natural gas (LNG) kits are very popular even on passenger cars (LNG being cheaper).

An SUV is virtually unheard of as a family car (unless you're a powerful politician, movie star, or other bigwig) and even a full-size sedan marks you out as rich. I've never seen a pickup truck being driven for passenger transportation.

Why do you think prices don't change behaviors? It's a pretty fundamental facet of human behavior.

> It's like changing the interest rate and hoping the economy will improve.

Don't central banks do exactly that? They cut rates in recessions (to promote spending) and increase them in boom times (to tamp down inflation).