California’s latest effort to tax its richest residents into leaving is barreling toward the ballot -only this time,it's got a built-in 'slippery slope' lever once voters hand them the keys.
Backers of the proposed “billionaire tax” say they have already cleared the first hurdle,gathering more than enough signatures (at least 1.5 million) to qualify a measure that would impose a one-time 5% levy on residents with net worths above $1 billion,theWall Street Journalreports. On its face, the proposal is straightforward:a targeted strike at roughly 200 ultrawealthy individualsmeant to plug a looming multibillion-dollar hole in California’s healthcare funding. Butburied in the fine print-and now surfacing in a growing political backlash-is a provision that could allow lawmakers to revisit, revise, and potentially expand the tax later with a two-thirds vote. That clause is fast becoming the real story.
The initiative’s language allows the California Legislature to amend the law so long as changes are “consistent with” and “further the purposes” of the act (aka the slippery slope). In Sacramento, that phrasing is doing a lot of work. Critics argue it effectively hands lawmakersa tool that could evolve well beyond a one-time billionaire levy. With a two-thirds majority, the Legislature couldlower thresholds, extend timelines, or reinterpret what qualifies as taxable wealth. In a state where Democrats already hold supermajorities in both chambers, that is less a hypothetical than a political reality.
This is significantI get it — taxing Billionaires is popularBut the proposed tax in CA is something vastly more expansiveIt would give the CA legislature a new power:The ability to lower the threshold or repeatedly pass the taxSimply with votes from the CA legislaturehttps://t.co/YcBUy7gTJN
California, meanwhile,has done this kind of thing beforewhere they kick the door open with a seemingly innocuous bill. For example,in 2012 voters approved Proposition 30 as “temporary taxes to fund education,”promising a sunset once the recession eased.Four years later, with the economy recovered,the same coalition returned with Proposition 55 and extended the high-income tax hikes for another 12 years—without extending the sales tax or returning to voters for full approval.Nearly identical “consistent with and furthers the purposes” amendment clauses appear in Proposition 64(marijuana legalization) and Proposition 63 (Mental Health Services Act), and have been used repeatedly to expand taxes, regulations, and spending far beyond the original ballot language. The billionaire tax measure contains this exact same permissive language. Once voters bless a flexible wealth-tax framework,Sacramento has shown it will use that door when fiscal pressure returns - which, in California, it always does.
The proposal has already triggered a high-profile reaction among the very group it targets.One of the most prominent examples isGoogle co-founder Sergey Brin.
In a late-evening confrontation at a Christmas party hosted by crypto titan Chris Larsen in a treehouse nestled in redwoods north of San Francisco,Brin and his wellness-influencer girlfriend Gerelyn Gilbert-Soto told Gov. Gavin Newsom they wereleaving the stateover the proposed billionaire tax, which could hit Brin’s massive stake in Alphabet and his fortune.
Newsom, who opposes the wealth tax, was still telling people about the lengthy exchange at the party months later, complaining of a lingering cold the pair had given him, according to the people, who asked not to be named discussing private conversations with the governor. -Bloomberg
Brin followed through: he relocated to Nevada ahead of the tax’s residency cutoff, purchasing a $42 million lakeside mansion on the Nevada side of Lake Tahoe.He has since poured more than $58 million into political efforts over the past four months, becoming the largest donor to the group Building a Better California, which is dedicated to fighting the wealth tax and pushing pro-business policies. His move and massive spending have become a symbol - if not entirely representative - of a broader anxiety rippling through California’s economic base. The concern isn’t just that billionaires might leave. It’s what happens if they do.
Also his wellness-influencer girlfriend (Gilbert-Soto) is pretty hot.
Source: ZeroHedge News
