California has billionaires on the mind.
Final week union activists, hoisting large cutouts of cash luggage and a cigar-smoking boss, introduced a proposal to boost Los Angeles metropolis taxes on corporations with “overpaid” chief executives.
They rallied in entrance of a logo of the uber wealthy: the futuristic, steel-covered Tesla Diner owned by Elon Musk, the world’s richest man.
In the meantime, a “billionaire tax” proposal prompted a few of the wealthiest Californians to contemplate fleeing the state, amid arguments that they’d take their tax income — and the businesses they run — with them, hurting the strange residents the proposal is designed to assist.
The deal with taxing the richest of the wealthy comes amid a rising affordability disaster in California, house to the nation’s most costly housing market and highest earnings tax.
Greater than 200 billionaires reside in California, greater than another state, in accordance with a bunch of regulation and economics professors at UC Berkeley, UC Davis and the College of Missouri who helped draft the statewide billionaire tax proposal, which proponents are hoping to position on the November poll.
And they’re getting richer. The collective wealth of the state’s billionaires surged from $300 billion in 2011 to $2.2 trillion in October 2025, in accordance with a December report by these professors. In Los Angeles, the place the median sale worth of $1 million places house possession out of attain for a lot of residents, outstanding billionaires embody David Geffen, Steven Spielberg and Magic Johnson.
One conspicuous billionaire is very unpopular in California: President Trump, who, regardless of campaigning on bringing down the price of residing, just lately known as the phrase “affordability” a “con job” as he redecorated the White Home in gold.
“In a deep blue state like California that has voted towards Donald Trump by such giant numbers within the final three elections, voters are much more predisposed to be suspicious of billionaires, as a result of he’s now the particular person with whom they affiliate the standing,” stated Dan Schnur, a politics professor at USC, UC Berkeley and Pepperdine.
The state and native tax-the-billionaires proposals, he stated, are “about retribution,” very like final 12 months’s Proposition 50, which briefly redraws the state’s congressional districts to favor Democrats as a counterweight to Trump’s efforts to extend Republican seats in Texas.
To get the statewide billionaire tax proposal on the November poll, supporters want to gather practically 875,000 signatures by June 24.
The measure would impose a one-time tax of as much as 5% on taxpayers and trusts with property, akin to companies, artwork and mental property, valued at greater than $1 billion. It could apply to billionaires who had been residents of the state on Jan. 1, with the choice of spreading the tax fee over 5 years.
Service Workers Worldwide Union-United Healthcare Employees West, its predominant backer, stated it is going to elevate $100 billion. Most of these funds can be used for healthcare packages, with the remaining 10% going to meals help and teaching programs, the union stated.
Suzanne Jimenez, the union’s chief of workers, stated Friday that “catastrophic” federal funding cuts stemming from Trump’s One Massive Lovely Invoice Act will power hospitals to shut, eradicate healthcare jobs and trigger insurance coverage premiums to spike, leaving senior residents and veterans with restricted entry to providers.
The California Price range & Coverage Heart estimates that as many as 3.4 million Californians might lose Medi-Cal protection and rural hospitals might shut except a brand new funding supply is discovered.
Jimenez known as the proposal “a modest tax” that “impacts few individuals.”
However Gov. Gavin Newsom vowed to cease the billionaire tax, arguing that California can’t isolate itself from the opposite 49 states.
“We’re in a aggressive atmosphere. Folks have this straightforward luxurious, notably individuals of that standing, they have already got two or three houses exterior the state,” Newsom stated on the New York Occasions’ DealBook Summit final month. “It’s a easy difficulty. You’ve acquired to be pragmatic about it.”
The billionaire tax would briefly improve revenues by tens of billions unfold over a number of years, but when billionaires transfer away, the state might lose “a whole bunch of thousands and thousands of {dollars} or extra per 12 months,” in accordance with the nonpartisan California Legislative Analyst’s Workplace.
A few of California’s wealthiest say they’re certainly heading for the exits.
Andy Fang, the billionaire co-founder of DoorDash, wrote on social media: “I like California. Born and raised there. However silly wealth tax proposals like this make it irresponsible for me to not plan leaving the state.”
Peter Thiel, the billionaire co-founder of PayPal and Palantir, introduced in December that his funding agency opened a brand new Miami workplace. He donated $3 million that month to a political motion committee related to the California Enterprise Roundtable, which is combating the measure.
State information present that Google co-founders Larry Web page and Sergey Brin have been slicing ties to California and shifting enterprise pursuits out of state.
Rick Caruso, the billionaire actual property developer who self-funded his shedding 2022 L.A. mayoral marketing campaign to the tune of greater than $100 million, stated in an announcement that “the proposed 5% asset tax is a really unhealthy coverage. It would ship nothing it guarantees and as an alternative harm California with misplaced jobs and a whole bunch of thousands and thousands a 12 months in misplaced income from current earnings taxes.”
Ending months of hypothesis, Caruso introduced Friday he won’t problem Mayor Karen Bass once more, nor will he run for governor in a race that features billionaire hedge fund founder Tom Steyer.
In Los Angeles, supporters of the “Overpaid CEO Tax” introduced exterior the Tesla Diner that they need to gather 140,000 signatures within the subsequent 120 days to get the measure on the November poll. The measure would elevate taxes on corporations whose CEOs make a minimum of 50 instances greater than their median-paid worker. It could apply solely to corporations with 1,000 or extra workers.
The Truthful Video games Coalition, a group of labor teams together with the Los Angeles academics union, is sponsoring the measure, which might allocate 70% of the income to housing for working households, 20% to avenue and sidewalk repairs and 5% to after-school packages and entry to contemporary meals.
Enterprise teams have denounced it, saying it will drive corporations out of town.
“Luxurious for a couple of, whereas those that prepare dinner, who clear, who construct, who educate, who write — the individuals who make town affluent — are stretched to the breaking level,” Kurt Petersen, co-president of the airport and resort employees union Unite Right here Native 11, stated at Musk’s diner, describing it as an avatar for an unjust L.A. economic system.
A related effort to extend taxes on corporations with disproportionately paid CEOs is underway in San Francisco, the place voters already accepted a levy on such companies in 2020.
On Friday, Doug Herman, a spokesperson for Bass’ reelection marketing campaign, stated she has “not taken a place” on the state or metropolis wealth tax proposals. However at her marketing campaign launch final month, Bass framed the mayoral race as “a selection between working individuals and the billionaire class who deal with public workplace as their subsequent vainness undertaking.”
Jeremy Padawer, a toy business government and animated TV producer who misplaced his house within the Palisades fireplace, stated the mayor’s framing of the race as a battle towards billionaires feels contrived, particularly given the extreme criticism of her dealing with of the fireplace.
Energy is as related as cash, and Bass is “essentially the most highly effective particular person within the room,” stated Padawer, who organized the “They Let Us Burn” rally on the one-year anniversary of the fireplace.
“I do know a number of billionaires,” Padawer stated. “And I feel that billionaires have a tendency to do a number of good, however in addition they have the propensity to do a number of unhealthy.”
Occasions workers author Queenie Wong contributed to this report.
