The International Monetary Fund (IMF) has recently released a report calling for tax increases in the world's wealthiest nations what the IMF calls "revenue-maximizing top income tax rates". As the IMF calculates it, the average revenue-maximizing rate for the main Organization of Economic Cooperation and Development countries is around 60%, way above existing levels (The current top marginal federal rate in the U.S. is 39.6%).

For the U.S., the revenue-maximizing rate is estimated to be 56% to 71%far more than the current 45% paid in federal, state and local taxes by those in the top tax bracket now. The IMF singles out the U.S. as the country where raising top rates toward 70% (where they were before the Reagan tax cuts) would yield the most revenuearound 1.25% of GDP. And with a chilling candor, the IMF admits that its revenue-maximizing approach takes no account of the well-being of top earners (or their businesses). The full story ishere.

Analyze the economic impact of this proposal should it be enacted. Be thorough and comprehensive.