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Dalio made these comments in response to a question about Ocasio-Cortez's proposal to roughly double the top tax rate, which she had done in a recent interview in the US. "60 Minutes" broadcast of CBS. The idea seems to have bipartisan support: a recent poll found that 59% of voters were in favor of the idea, and even 45% of Republicans agreed.
The idea of Ocasio-Cortez, who defines himself as a social-democrat. , comes just one year after the corporate and personal tax cut imposed by President Donald Trump, which allowed US corporations to save billions of dollars in taxes.
While the other members of the financial elite present in Davos meet each year. The richest and most powerful people in the world, described as "frightening" or denying their chances, answered Dalio in a more measured way.
"We agree on the problem underlying this suggestion," said Dalio. "We have to make sure that capitalism works for the majority of Americans, I do not think we agree on mechanisms."
Dalio particularly worries about the unintended consequences of rising marginal taxes on the rich, and how additional tax revenues will be used, which could affect US productivity.
"If we apply a marginal tax rate of 70%, most of those involved will determine whether or not it is appropriate to carry on business as a corporation, try to convert ordinary income into capital gains, so I wonder how this will be managed, "said Dalio. "And I wonder what will be done to determine if the capital will leave the country."
Dalio is not the only one to worry about the proposed tax hike. Former US Federal Reserve Chairman Alan Greenspan said it would be a "terrible mistake" that would hurt the economy.
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