When devising his tax plan during the campaign, I bet Barack Obama saw a graph that looked similar to this. This New York Times graph shows the tax revenues, by percentage of total income.
You’ll note that a progressive tax scheme — like the one the United States has — should actually increase as you move from the poor to the insanely wealthy. The reason for this is an economic principle called “declining marginal utility” which a lot of conservatives seem to forget when discussing tax cuts. The basic idea is that with each additional unit of a good you get, (at a certain point) the utility you derive from that unit starts to decline. For example, $1 means more to someone who makes $30,000 per year than somebody who earns $300,000 per year, and much, much more than it does to someone who earns $3,000,000 per year. So if we assume fairness to mean “affects all equally”, it makes sense then that the rich to be taxed at higher rates. But even if we remove fairness from the equation, the declining marginal utility of money also stipulate it’s a good idea from a policy perspective. That is, because $1 has greater utility as your income goes down, more money at the lower end of the income spectrum is likely to mean more money spent in the economy.
Of course, there are equilibriums. The rich should not be taxed so onerously as to discourage investment, but somehow, I imagine someone who goes from an after-tax $7.9 million to an after-tax $7 million will still be able to scrounge up some change.