Glen Whitman sees a big hole in my Pigovian minarchist tax idea.  He’s in blockquotes, I’m not.

Pigovian taxes on genuine negative externalities are
definitely better than other kinds of tax as a means of funding
government, inasmuch as they eliminate dead weight loss rather than
creating it. But I see a problem with the argument you’re making here,
that such a tax would both violate no rights and raise revenue.

1. Suppose the tax is per unit of output or activity, as is
generally the case with Pigovian taxes. Then the tax will be paid on
every unit, regardless of whether it’s above or below the efficient or
non-rights-violating level. If the tax is set perfectly, so that the
equilibrium level of activity is the ideal level, then the *only* people
paying the tax will be those whose activity is efficient or
non-rights-violating (depending on how you define ideal).

True, this is not my proposal.

2. One way to avoid the problem above is to institute a
discontinuous tax, which would be zero up to the ideal level and
positive thereafter. This would generate the same marginal incentives
and thus the same outcome as the regular Pigovian tax. But in
equilibrium, again assuming the tax is set so as to generate the ideal
outcome, the tax would generate zero revenue, since total activity would
never rise to the tax-triggering level.

Perfectly true if the discontinuity is at the individual level.  If the government charges me zero for the first ton of carbon I emit, and a prohibitive tax on all additional carbon emissions, I will never emit more than one ton, and will pay zero tax. 

But what if the discontinuity is at the aggregate level?  Suppose total carbon emissions over 1,000,000 tons a year violate rights.  Then the government can permissibly impose a Pigovian tax sufficient to get emissions down to a 1,000,000.01 tons a year.  Individually, people still have an incentive to pay, because you can pollute as much as you want as long as you pay the tax.

Why 1,000,000.01 tons, and not 1,000,000 tons?  Because then, Glen would be right again.  Once total emissions fell to 1,000,000, the morally permissible tax would revert to zero, and the government would raise no revenue.  The minimal state would have to tolerate an epsilon of rights violations.  Of course, given the fuzziness of the morally permissible thresholds, this is not a flaw of much practical interests.