Then some company works out how to do the same thing in a less carbon intensive way, and it's cheaper.
That's the whole point. This isn't fixable without pain, no matter how people pretend.
Whether we figure out a less carbon intensive way or just consume less, I think we can agree the benefits are the same.
I have a pet theory that we've reached a kind of "Peak Comfort". While commerce and industry yearns for more revenue, I hope that at some point the average consumer will start to say "Hey, this is probably enough comfort for me, I should focus on other things in my life." Whether that manifests in using less electricity, buying fewer fancy technology bits or sticking with their current car a few more years. Perhaps that is a naive hope, I am not sure.
Reducing waste (CO2) will boost profits.
https://en.wikipedia.org/wiki/Muda_(Japanese_term)
Industry is asking for a carbon tax. There are few holdouts, for political and personal reasons. Namely, fear and ignorance.
Also see this paper, which is actually arguing for a slightly different system called cap-and-dividend but with the same outcome in mind: http://www.peri.umass.edu/fileadmin/pdf/working_papers/worki...
A plan such as tax-and-dividend or cap-and-dividend also breaches the political divide and shows that both sides can get what they want in a single sensible system. Yes, certain lawmakers will still spitefully resist as they always do.
Sounds about right.
Australia trialled this. I say trialled, because our government has been such a flip flop of agendas (and indeed leaders) for nearly a decade and it was only around for 3 years before being repealed. No doubt we'll see it again soon, and I look forward to rehashing the same tired debates, albeit in slightly warmer weather, when that occurs.