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I don't really see how this is controversial. Do you want to reward talented people who work hard? Do you want to incentivize people to do great things? You need to allow some level of income inequality. The extreme level of income inequality we see now is a bad thing.. but that doesn't mean economic inequality is inherently bad. Most good things taken to an extreme cease to remain good things.

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It's controversial because it's largely a strawman. Income inequality is not a binary thing—it's a gradient. There exists a level of income inequality that any reasonable person would agree is bad. PG seems to be trying to muddle that fact.

Just because something motivates someone to do great things doesn't mean it is good to offer that reward. If someone was motivated by the desire to own slaves, etc.

In light of the fact that increasing wealth has diminishing returns in terms of utility, what if the desire for extreme wealth is simply the desire for power? How much power inequality is acceptable in a democratic society? Couldn't you motivate people with fame instead?

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