That's why a tax is so simple. Intensity gives governments a lot of room to hide, because they can overestimate the current emissions, and it gives industries some room to hide. That's what happened in Europe; people overestimated. But a cap and trade too. The reason the European carbon price collapsed is people had the estimates set too high, and then when the real estimates became clear, the price collapsed. That's what's neat about a tax. There's no mystery.
On February 27th, 2007. See this statement in context.