> $1 is worth much less to the rich than it is to the poor. So if we redistribute it to the poor, the whole of society will get better utility of that dollar.

Erm. Whoa there. This seems to me to be fundamentally flawed in no less than two respects...

1) $1 may be less valuable to a rich man than a poor man but that -does-not- imply that it is of less value to society for it to be in the rich mans hands than in the poor mans hands. In fact, it's quite easy to argue (and is often done) that it's substantially more valuable, to society as a whole, in the rich mans hands than in the poor man's hands.

2) More broadly, and the first point follows from this point, this is a false dichotomy. Society doesn't have a fixed number of wealth and it is not a zero sum game. You cannot trade dollars 1:1 and ignore the economic impact.

> A question very relevant to us is "Will it?".

I find it interesting that you take the first proposition at face value as "self-evidently" true but feel the need to question this second proposition. I find the first one substantially more controversial than the second.

Of course increasing the marginal tax rate is going to have some quantifiable effect on the people's habits. Let's say I have a private medical practice and I have the choice between working fridays and getting taxed 70%, or I can have the practice closed up on Fridays so I can play golf, what would I do? What % of doctors would close up shop on Friday?

Whatever the answer is, it's not zero.