Jonathan Adler is also on the Carbon Tax bandwagon:
I've been arguing that a revenue-neutral carbon tax is preferable to cap-and-trade for some time (see here and here). The real dealing has yet to begin, and already the House cap-and-trade bill is being watered down to accommodate corporate interests, and it will only get worse. I have no illusions about the likelihood of a "clean" carbon tax bill emerging from Congress, but I believe cap-and-trade is inherently more vulnerable to special interest manipulation -- a problem made worse since so few people understand what cap-and-trade means. As actually implemented, cap-and-trade is also less likely to spur the sort of innovation necessary to meet even less-ambitious climate targets, particularly if Congress insists on combining it with energy portfolio standards that constrain the market's ability to shift toward the most efficient means of emission reductions. So, in the case of carbon, it's time to consider a revenue-neutral tax.