If you own property in California, you're not safe. A new ballot measure will empower the state to confiscate a percentage of the assets of any resident, even though its initial provisions don't communicate that intent. California's "One-Time Wealth Tax for State-Funded Healthcare, Education, and Food Assistance Programs Initiative," which has already qualified for the November ballot, is even worse than it appears.
It's not as if appearances aren't bad enough. The explicit intent of the initiative already chased at least six billionaires out of the state in 2025. Moved to Florida are Google co-founders Larry Page and Sergey Brin, along with PayPal co-founder Peter Thiel. Nevada is now home to billionaire Don Hankey, and Texas has welcomed former Uber CEO Travis Kalanick. Famed director Steven Spielberg has moved to New York, apparently concluding even that deep blue state is a safer bet than California. Just the departure of these six men has lowered the potential take from the wealth tax by an estimated $27 billion.
A Hoover Institution study claims that another 20 California billionaires have already made departure plans and will leave immediately if the initiative is approved by voters. One of the initiative's many diabolical provisions is that it will apply retroactively to anyone living in the state after January 1, 2026, but unlike the six who got out in 2025, this next tranche of would-be exiles have been advised by their attorneys that the initiative's retroactivity will not survive a constitutional challenge.
Other details of this initiative are likely to survive court challenges, and they reveal a stunning level of aggression toward wealth. If you live in California, and this bill is approved by voters, you will have to pay a "one-time" tax of 5 percent of your "covered assets" valued over $1 billion. "Covered assets" include unrealized gains in the value of stock owned by employees of private companies. It is unlikely the framers of this initiative didn't understand the implications of this provision. Valuations of private companies are subjective, volatile, and illiquid. An employee with stock options valued at a few billion in the last private equity round could be assessed tens of millions of dollars in wealth tax on money they don't actually have access to, based on a value that could plummet at any moment.
It gets worse. The language of the wealth act provides for what amounts to unrestricted escalation of its reach, something that will surely become necessary when high earners are driven away, taking their taxable assets with them. Built into the 2026 Billionaire Tax Act is the right of the state legislature to amend its provisions with a two-thirds vote. That would include lowering the $1 billion threshold, replacing "one-time" with an annual assessment, and eliminating the exemptions currently present for real estate and retirement accounts. The wording of this initiative is purposely designed to give the state legislature the authority to override the property tax protections afforded by Proposition 13, passed by voters in 1978 and one of the only obstacles left that prevents the state from stripping the state's middle class of assets they've earned and stewarded over generations.
It is ridiculous to think California's state legislature cannot muster a two-thirds vote, anytime they wish, in order to extend the reach of the "Billionaire Tax Act" down to "millionaires," which, in California, is almost anyone who has owned their own home for more than a decade. In both houses of California's state legislature, 75 percent of the seats are held by Democrats. The overwhelming percentage of Democrats in California, and, for that matter, a sizable portion of the state's dwindling contingent of Republicans, are controlled by the state's powerful public sector unions. And more than anything else, these unions have one guiding principle: grow government, because bigger government means more membership, and more membership means more dues revenue. That's the reason that the top 10, if not the top 50, largest contributors to winning campaigns for seats in the state legislature are all public sector unions.
To grow support for more government, you must grow dependency on government, and to that end, California's state legislature has engineered a perfect storm. Every decade, more regulations buried small emerging competitive businesses, allowing the biggest and most politically compliant businesses to gain captive markets. And in complying with the state's overregulation, lacking competition, these politically favored businesses passed the increased costs of regulatory compliance on to their customers. Voila, California's energy, water, transportation, higher education, housing, and all government services became increasingly unaffordable. And as households, by the millions, could no longer afford to survive economically, government aid stepped in to fill the gap.
The numbers support this assessment. Between 2010 and 2025, when the state's total population only increased incrementally by about 1.5 million people, the number of participants in California's taxpayer-funded food aid benefits soared from 3.7 million to 5.5 million, and the state's Medi-Cal enrollment exploded from 7 million to 15 million, over one-third of the population.
Everything California's state government has done over the past 15 years has exploded commensurately. The state General Fund in 2010 was $87 billion. In 2025 it was $228 billion. Even adjusting for inflation, spending more than doubled when the total population barely budged. And what of this population?
Over the period from 2010 to 2025, nearly 10 million people moved from California to other states. The people moving into California and the people choosing to remain in California are increasingly characterized as either high-income residents who can withstand the high cost of living or low-income residents who depend on government assistance. California's Gini Coefficient, at 0.49, puts it in a virtual tie with New York and Connecticut as the states with the worst income inequality in the nation. To claim this is the fault of billionaires is a convenient lie, promulgated by the very politicians whose own policies were the true cause.
It ought to be clear to anyone who has spent any time in sunny California, a place blessed with literally every scenic amenity imaginable from alpine peaks to sandy beaches, the best wine on earth and spectacular coastal cities, that the only thing that could possibly induce them to not want to live here permanently would be an overtly hostile government. And that's exactly what has happened. Every major challenge California faces is the product of a government that has decided to serve itself instead of the people.
The model of "democracy" that California has perfected can be summed up in one sentence: overregulate an economy to make life unaffordable without government handouts, then win elections by promising more government handouts to people who can't live without them. It is unsustainable, because as the old cliche goes, pretty soon you run out of other people's money. The exodus of California's wealthiest residents is the latest iteration of this doom loop.
Far removed from idealistic fantasies sold to voters, this is the reality of progressive politics in California. Given half a chance, it will be exported to the rest of the nation.
