Guardian: Why the 1% should pay tax at 80%
This article is really barking up the wrong tree. At some point you actually do make less money in taxes at a higher rate than a lower one. It's the one thing that Reagan was right about.
But I still say put taxes up that high again. I think in the 50s-70s, it, along with unions, helped to build a stronger middle class because it created a soft price ceiling on income. CEOs have way too much bargaining power in the market today, which is what is causing our major inequality problems. We're in a time where businesses really want to lull away CEOs with a ever growing paycheck. This is good for CEOs, but bad for workers because larger and larger portions of the business's coffers are going to CEOs just so they don't have to bother with getting a new CEO every year.
Say a CEO is making 500k and needs see a 100k increase after taxes to make moving to another company worth it. In order to make that 100k incentive happen, that new business needs to pay 1 million a year to compensate for the taxes.
It does deincentivize pay raises past that point, and that means the government makes less money in taxes, and thus why I said Reagan was right. But it doesn't deincentivize work because 500k is still a hell of a lot of money and I'm sure there's 5 equally qualified people right below him that could do the job just as well. The money saved from not paying so much money to CEOs can then be reinvested into other new jobs, and with enough new jobs on the market the people might have a better chance at bargaining for better pay.
Right now if you want to save money on a CEO by picking someone who hasn't had CEO experience, you would probably get a overall better deal in the first year since a CEO is rarely twice as good as next in line, but that CEO job on his resume that you just gave him is all the bargaining power he needs to extort you out of a ton of money in the next year. So given that, it's pointless to take a risk inside the company right now instead of just paying big money from the start to a guy that is already proven. 80% progressive tax brackets would fix that.