When Gore and others have proposed a carbon tax (or anything else - like cap and trade - which implicitly assigns a cost to carbon - they always included rebates to people most affected by this. The reasons was that a carbon tax would be a huge tax to a middle class or working class person who drives an old car and lives in an area where coal is used to create electricity or heat homes. (It is even possible that Bill Gates, living in Washington state where there is substantial hydro-electrical energy could get a lower tax (or only slightly higher) tax on his home and cars than a hypothetical worker in - say, Pennsylvania. Compare this to raising that top rate to Clinton levels.
That said, I am 100% behind efforts to tax carbon because it really is critical that the US lead on this. The only way that this could ever pass the Senate is if the regions that are dependent on coal which would bear the brunt of the tax got back part of that money to the state to protect the people who had nothing to do with choosing for their electric company using coal over natural gas or hydro electric.
If you remember in 2009 and 2010, John Kerry worked hard to try to get a bill that could pass the Senate on climate change. You might remember that early in that process the "coal state" Senators signed a letter that essentially was concerned about the burden on their states. The signees included people like Sherrod Brown (who worked with Kerry on this very issue), Feingold, Harkin and others. The solution was to use the "revenue" for research, to aid converting to better forms of energy and to avoid the burden falling disproportionately on people who had nothing to do with the decision on which on energy source.
I think that the goal of taking in enough revenue should NOT be mixed with using financial incentives to move the country off fossil fuels - though I am 100% for both goals.
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