Actually in London it's slightly different they charge you a road toll on weekdays (mon-fri), which is about $10/day... and it does work, but only due to the fact that they have a really good public transit system in place... The only downfall was that it resulted in a huge shortfall in the city budget...

As for the tax per mile issue, I don't think that it will ever work in Cali... Like TheOtherDave mentioned the cost to implement the system would be too great... although they could do an electronic toll system, like we have in Toronto, it actually works really well, but it would involve a huge investment from the gov't to put the necessary infrastructure in place.