Excessive marginal tax rates are still a bad idea no matter if they just kick in on income over $10 million

Washington Post:
If she were proposing that incomes above $10 million be taxed at a rate of 70 percent, she’s not suggesting that those making $10 million or more be taxed at 70 percent for every dollar.
Her idea is based on the false premise that the government can better spend the money collected at this rate than the person who actually earned it or won the Power Ball Lottery.  But if you look at the economic activity under the current tax code, you find investors and businesses are creating jobs and economic activity and lifting people up from dependency on the government.  That is far more important than any socialistic goal of forcing everyone to work for the government.  Those systems are doomed to failure.

Venezuela is not the only bad example.  The bread lines in the old Soviet Union and in the eastern bloc were caused by the same inefficiencies of government.  In the capitalistic system, a baker who needs more flour and other ingredients can contact his supplier and order it and pay a market price for it.  Under the socialist system, they have to wait for the government to deliver their allotment which may not be sufficient to meet the demand.  When the Soviet Union fell, East German bakers were still sitting in their shops waiting for delivery of flour and had to be taught how to order it and pay for it.

Socialism does not work because commerce is much more efficient in distributing goods and services.  Imagine someone making a decision on how many eggs and slices of bacon are needed in New York City every day.  They would always be wrong ordering either too little or too much.  If they set prices they would usually set them at a rate that would not return a profit for the person creating the goods and services.  That is why Venezuelan are starving.  But in New York City each market and restaurant can decide how much it needs and order it at the going price.  If a supplier has too much he lowers the price and if he has too few he raises the price.

AOC seems to have no grasp of how the economy works and why socialism fails.

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