California voters will decide in November whether to impose Proposition 40, a one-time 5% tax on the wealth of Californians worth at least $1 billion. The measure targets roughly 200 billionaires who lived in the state as of January 1, and supporters say it could raise around $100 billion, most of it earmarked for health care after federal Medicaid cuts.
The opposition campaign, Building a Better California, has already reserved $87 million in advertising ahead of the vote. Google cofounder Sergey Brin has contributed more than $100 million to the group, with venture capitalist John Doerr and crypto entrepreneur Chris Larsen also funding committees fighting the tax.
Leading the opposition is Ned Wigglesworth, a consultant who two decades ago warned about the 'billionaire boys' club of politics' as a campaign finance reformer. In 2005, he cautioned that wealthy interests would spend '150 million bucks' to protect their 'piece of the pie.' Today he is the strategist steering the campaign against a tax aimed at some of the same wealth he once scrutinized. The San Francisco Standard has dubbed him a 'billionaire whisperer.' Fortune reports he did not respond to requests for comment.
Governor Gavin Newsom opposes Prop. 40 even as he has called for higher federal taxes on the ultrawealthy and for the state to 'democratize our economy.' His opposition rests partly on arithmetic: nearly half of California's personal income tax revenue comes from the top 1% of earners.
The stakes for individual billionaires are stark. Brin reportedly would owe $13 billion if the measure passes. He and fellow Google cofounder Larry Page relocated out of California before the January 1 cutoff and have since amassed roughly $225 million in Miami real estate. Venture capitalist Vinod Khosla says he has no plans to leave, but has warned the state could permanently damage its tax base if other wealthy residents follow Brin and Page out the door.
The political money at stake dwarfs what Wigglesworth once flagged as dangerous. California's 15 richest billionaires have poured more than $336 million into state and federal elections this year, with Brin, Marc Andreessen, Ben Horowitz and Larsen alone accounting for $331 million of that total.
The numbers come first, and they tell a simple story: capital moves toward where it is treated as property, not as a piñata. A one-time confiscation of 5% of a fortune is not a tax on income; it is a tax on ownership itself, and owners respond to incentives like anyone else. Brin and Page did not wait around to find out how Sacramento would spend their money — they moved it, and themselves, to Florida.
The irony of Wigglesworth's career pivot is real, but it is also beside the point. What matters is that California, which depends on its wealthiest residents for nearly half its income tax base, is now testing whether it can tax that base at will without losing it. The market has already voted with two of Google's founders and a few hundred million dollars in Miami condos. Sacramento may soon learn the rest of the answer.
