Your absolutely right, price goes up, people buy less. But its not linear, and its bounded. If I were an economist I could explain better, I think its called elasticity of supply. Actually with energy its probably in-elasticity of supply.

But, as I say, to some extent I agree with you on that. Tax bad things.

Where I think your Utopia is misled is in Government not getting involved in security of supply. I believe they have to be involved. An example, BT has to provide a service that is in some way tolerant to EMP strike. Its expensive and generates no profit. There is no way that the BT board would ever do this unless forced to.

Mostly Government should have a light touch, tax bad things etc and let market forces take over. But there are instances where this is not enough, and never will be.

Actually, now I'm thinking about it there are other Tonopian things that I have issues with. Taxing things to change behavior, surely that is unfair on the poor?