I & I Editorial BoardThe Billionaire Tax Act isn’t even officially on the California ballot yet, but that hasn’t stopped businessmen, entrepreneurs, and investors from fleeing the state, taking $1 trillion in wealth – along with jobs and opportunity – with them.
Tech entrepreneur Chamath Palihapitiya has been keeping track of who’s decided to leave the state in advance of this “temporary” tax.
“We had $2T of billionaire wealth just a few weeks ago. Now, 50% of that wealth has left – taking their income tax revenue, sales tax revenue, real estate tax revenue, and all their staffs (and their salaries and income taxes) with them,” he posted on X this weekend.
“In other words, by starting this ill-conceived attempt at an asset tax, the California budget deficit will explode. And we still don’t know if the tax will even make the ballot.”
Among those who’ve given up on California are Google co-founders Sergey Brin and Larry Page. The New York Times reports that 10 days before Christmas, Brin “terminated or moved 15 California limited liability companies that oversee some of his business interests and investments out of the state” and “more than 45 California limited liability companies associated with Mr. Page filed documents last month to either become inactive or move out of the state.”
Venture capitalist Peter Thiel opened an office for his family investment firm in Miami. David Sacks moved his Craft Ventures office to Austin.
The Billionaire Tax Act would impose a (supposed) one-time, 5% levy on net worth – not income – exceeding $1 billion. Backers say the state desperately needs the money to fill its budget hole.
But California’s financial problems aren’t the result of under-taxing residents. They’re the result of massive amounts of overspending by Democrats who control the state, much of which has been lost to waste and fraud.
Even so, why are tech billionaires pulling up stakes without even knowing whether the measure will get the required 870,000 signatures to make it on the November ballot, much less get approved by voters?
Why? Because they’ve seen firsthand how relentlessly anti-business this one-party state has become and how reckless its voters are.
This is a state, after all, that has managed in the past few years to kill its other golden goose, the film industry – the Wall Street Journal last fall said “L.A.’s Entertainment Economy Is Looking Like a Disaster Movie.”
It’s a state that sits at the top of the list for highest tax rates, but the bottom of the list for just about everything else. (See “Do Californians Realize How Badly They’re Getting Ripped Off?”)
It’s a state that – despite idyllic weather and natural beauty – has driven more than 1.6 million residents away. (See “The Great Divorce Continues.”)
As we noted in this space a couple of weeks ago (See “California’s ‘Get Out Now’ Tax”), “Businesses and people are fleeing because lawmakers and blue voters are stuck in a Bolshevik rut.”
The question is, what will it take to get California’s lawmakers and voters unstuck?
— Written by the I&I Editorial Board
John Merline
Yes, there are blue voters but I no longer believe California elections are honest. If the state had voter ID, paper ballots and same day ballot counting, I believe most of these insane election outcomes would be different. It may never be a red state because of the large coastal cities but it would be closer to normal than it is now.
Agreed. For several elections in a row I showed up to vote in-person only to be told their records show I had already voted. I had to cast a provisional ballot and 18 months later was told that my vote was rejected. I know a few friends who received up to 20 ballots in their mailbox! They only discovered it because they happened to be outside when the Postal driver arrived and handed the mail to my friend directly. Previously people apparently arrived sooner to take the ballots.
There is no one solution to California’s deep problems but it begins with convincing voters to STOP ELECTING DEMOCRATS! This will be a complex challenge given how dishonest and corrupt elections in my state are, beginning with the deeply dishonest “jungle primary”’system which guarantees that voters will only be able to choose from 2 Democrats. This anti-democratic mess completely misrepresents the purpose of the primary election process, which is supposed to be a transparent way for members of each political party to select their standard bearers in the general election. So-called non-partisan primaries all the Democrats to purposely vote for the weakest Republican on the ballot, then vote Democrat in the general election. Furthermore the top 2 vote-getters appear on the ballot, with predictable results. This must end if California is to have a chance at ending one-party, Marxist rule.
With all the homelessness, the crime, the welfare fraud, the palisades (which hasn’t been rebuilt yet), and-of course-the new tax proposed on billionaire’s wealth (which-I think-is unconstitutional because it is on wealth-and I believe is a bill of attainder) , I’m sorry I’m not a billionaire who lives in California because then I would be able to leave.
What a wonderful life-being a billionaire and not having to say “I’m sorry” for voting for Newscum-presumably (as President Trump characterized him).
The people I feel sorry for are those who don’t have the means to move and voted against Newsom for governor.