One argument in favor of this is that it would pretty much force governments to set reasonable speed limits, rather than optimizing them to ensure that the police have an excuse to pull over almost anyone at any time.
No, it would allow them to adjust the limit to whatever brings in the most revenue without crashing the economy or engendering open revolt.
It would always be entirely unworkable at anything resembling the current fine structure, with fines in the $100s for a single infraction. These are based on the assumption that people are rarely caught.
I could see a surveillance-based system working, something on the lines of a congestion toll. Maybe $0.02/mi/mph over the limit, so going 10mph over the limit for 20 miles would be a $4.00 charge. We'd also have to eliminate the bogus insurance surcharges which falsely equate speeding with unsafe driving (barring neighborhoods & construction zones, they can signify either an unsafe driver or a highly skilled driver).
