What Could Possibly Go Wrong?

Matthew Yglesias wonders why the government can't decide that those making yearly salaries in excess of $10 million are unworthy of such obscene levels of compensation and, in the service of "egalitarianism," couldn't simply apply "arbitrary limits" to tax away this excess wealth:

What if we had a 95 percent marginal tax rate on income over $10 million? What dire consequences would flow from this? Perhaps a certain outflow of top-flight baseball talent to Japan. But I don't see this leading to any kind of economic calamity.

Yes, what could possibly go wrong? And why, since 1980, has every country with a functioning economy lowered top marginal tax rates if there are no negative effects of massive government wealth distribution? Besides, says Yglesias, a confiscatory tax policy would be something of a relief to a great majority of the upper classes:

But my strong suspicion is that at the end of the day most of the super-rich would ultimately find it a relief to get off the treadmill of status-competition and the not-quite-so-rich would be thrilled to see their betters cut down to size.