Talk politics.

That is the entire idea! You are still gaining in terms of the standard of living. The fact that you are bringing home a smaller % of your paycheck due to taxes even though you are working harder, is offset by the increase in your standard of living. But what if that tax rate was 80% or 90% on that higher income? Then less people would choose the harder and longer hours for that extra income, because your standard of living wouldn't be increasing as much.