Without any taxes, accepting that editor’s assignment would have yielded my children an extra $10,000. With taxes, it yields only $1,000. In effect, once the entire tax system is taken into account, my family’s marginal tax rate is about 90 percent. Is it any wonder that I turn down most of the money-making opportunities I am offered?
The comparison is unfair, as it compares no taxes to some taxes, but it is done to illustrate how the effect of seemingly small changes in marginal rates "compounds" the effect of taxes over the years.