Piketty points out that the post-WWII American confiscatory taxation regime was also a way to prevent the principle-agent problem[0] with corporate executives.

Piketty points out that the post-WWII American confiscatory taxation regime was also a way to prevent the principle-agent problem[0] with corporate executives. Why, if I control the company, would I not just transfer all the valuable assets of the corporation to myself and leave the shareholders holding a sad sack of debt? Under postwar taxation, I wouldn't do that because I wouldn't actually personally end up with anything: it'd all go to the taxman. Now that the top marginal income rate is so low and the capital gains rate is even lower, we see top executives transferring vast amounts of corporate assets to themselves. [0] https://en.wikipedia.org/wiki/Principal%E2%80%93agent_problem https://en.wikipedia.org/wiki/Principal%E2%80%93agent_proble...