Will the Australian carbon tax work?

The long-awaited carbon tax announcement by the Australian Government looks like a bit of a fizzer to me.

It seems pretty pointless to introduce a tax and then compensate virtually everyone for the extra costs they will face – when the purpose is supposed to be to change behaviour and reduce greenhouse gas emissions.

If no-one feels any pain, where is the incentive for people to cut down on their use of petrol, diesel, electricity and all the other pollutants which have become an automatic part of their lives.

On the farm we have reduced our carbon footprint by restricting our delivery policy to within one hour of the farm, using manual production methods (rather than collecting eggs via electricity-driven belts etc.) and maintaining native vegetation on the property.

I don't understand what benefits in terms of a reduction in carbon dioxide emissions the Australian Government expects from a tax which doesn't encourage end users to modify their behaviour.

State Governments seem to understand that the simplest and most effective way to cut down on the use of water is to double the price.

Should be the same with electricity – that will make it more cost-effective to install solar and wind plants – and fuel to cut down on the use of hydro-carbons.