The idea of the progressive tax is the concept that the wealthy have a social responsibility to the impoverished.
There are many flaws with the system of taxation and many complexities involved with income inequality. How long until we hear "Who knew the tax system could be so complicated?" Come out of some famous person's Twitter feed?
Yes, Taxation is "just paying interest on the Federal Reserve" this is the fundamental core of the National Debt, however that debt came from somewhere. The US bought highways, railways, libraries, parks, banks, automotive manufacturers, military personnel and equipment (the list goes on) with borrowed money. Borrowed from who? US! EVERY ONE OF US, OUR PARENTS, MOST OF OUR GRANDPARENTS! It is our money that the US borrowed and it's our money that's paying it back!
Even though that problem exists, we cannot simply keep inflating the debt to pay for the dollar (imagine $24,500 for a t-shirt) so we still have to generate a way to reclaim some of that capital. This is what our tax system does, it reclaims some of the debt to minimize the impact of inflation which is created by false scarcities.
Income inequality doesn't always come from hard work. I personally have worked 50 hour weeks with my spouse also working full time and, because of occupational inequality and geographic inequality, we were barely able to pay day to day bills. On the other side of the coin, a friend of mine works 12 hours a week and makes $1,000 to $7,000 per hour (she is a grant writer). So why should I have to work 4 times as hard and get so much less? Better still, a former friend was born into money and simply lives off of roughly $150,000 in INTEREST a month. So it's not as cut and dry as work harder to be more successful.
I have often been in favor of a tax on spent money, but not forwarded on to the consumer. In my vision, a system of corporate tax should fund the government and repay the people. This corporate tax could, of course, be offset through philanthropic efforts that relieve the government of financial responsibilities like providing healthcare, building parks, offering housing benefits, and job creation.
I could likely go on for hours ...
RE: Bill Gates makes a case for consumption taxes rather than income taxes