Personally, I can never think of proper tags for all my entries, so I created this. Based on an article from Zomie.com, I took the concepts there and added them to the YUI RTE plugin.
To enable auto-tagging you will need to get yourself an appid from the Yahoo! Developer Network, but it's very straightforward.
Once you have an appid, enter it into the blog plugin config page and a button will be added to your RTE toolbar which, when pressed, will scan your text for terms and present you with a list of suggested tags, which you can then click on to add them to your tags field.
Currently only searches the active page (body/extended), so try it on both to get the best results if you are using an extended entry.
Download YUI Rich Text Editor for MovableType 4 v1.3