He named the argument for free market capitalism vs. socialism after himself? Wow.
Invisible hand: two people following their own greed by engaging in a non-coerced, knowledgable exchange, produce a surplus benefit, in which both individuals are better off.
Munger test applied to the idea of the invisible hand: Does it work for greedy people? yes. If one party won't be better off as a result of the exchange, they won't participate.
Munger test applied to the idea of increasing revenue by increasing tax rates on the ultra-wealthy: Does it work for greedy people? Not linearly, because they'll have a great incentive to find ways to restructure or shelter their income from the increased taxes.
Capitalist farmer grows 10% more food; they make higher income from the sale of their crops. Communist farmer grows 10% more food; the farmer doesn't see extra benefit. Why bother to do the extra work?
The ideal person might answer "For the greater benefit of my fellow countrymen". A realistic person might answer "Come to think of it, I wonder how little work I can do before I actually see concrete negative consequences".