California’s tech leaders have spoken out against a proposed wealth tax seeking qualification for the November 2026 ballot, warning of relocations if it passes.
The measure would place a one-time 5% tax on the assets of California residents worth more than $1 billion. If passed, it would apply retroactively to people living in the state as of the beginning of 2026. The proposal comes after a year of Democrats settling on reheated Bernie Sanders-style talking points against billionaires in their campaign rhetoric, as they aim to make a comeback in the 2026 midterms.
Tech mogul Peter Thiel has reportedly been looking into leaving the state if the measure passes, as has Google co-founder Larry Page. In response, California Democratic congressman Ro Khanna, whose district includes part of Silicon Valley, snarked, “I will miss them very much.”
Notably, Governor Gavin Newsom opposes the measure, reflecting the fact that the Democratic Party largely split between the upper-middle professional class and its Bernie-descended left wing. Despite incessant claims of oligarchy and billionaire rule since the start of the second Trump administration, the Democratic Party is held together by its social and racial ideology, not economics.
California has become heavily dependent on tech and AI for economic growth. During the height of the COVID-19 shutdowns, San Francisco’s downtown saw several businesses close as tech companies embraced remote work and employees relocated. The area has seen something of a recovery with the last two years of the AI boom and the enactment of in-office policies, but the experience lends credence to the idea that tax-inspired tech migration could have a cascading negative impact.
More glaringly, though, the proposal shows that Democrats have no new economic ideas. A one-time wealth tax will not alter the class stratification that exists in California, or the country as a whole, for that matter. The party has simply settled on blaming billionaires as easy, safe rhetoric to mobilize its voters and give them a socially-acceptable group to blame. This strategy worked in the recent New York City mayoral election, and it may well work in California. What it won’t do is actually address the state’s problems.
