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THE FIRST POLITICALLY VIABLE WEALTH TAX
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Harold Meyerson
October 23, 2025
The American Prospect
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_ A proposed 2026 California ballot measure would tax billionaires’
fortunes to fund imperiled health access for 15 million state Medicaid
recipients. _
Protesters gather during the “Workers Over Billionaires” Labor
Day rally in Echo Park, September 1, 2025, in Los Angeles., J.W.
Hendricks/NurPhoto via AP
Earlier today, one of California’s most powerful unions and two of
the nation’s most prominent progressive economists unveiled a 2026
state ballot measure that would establish the nation’s first wealth
tax. In the course of their presentation, they offered a master class
in how to structure such a tax in ways that disarm its opponents.
The union behind the proposal is SEIU’s United Healthcare Workers
West, whose members work in hospitals and clinics across the state.
The economists are UC Berkeley’s Emmanuel Saez (whose work with
Thomas Piketty and Gabriel Zucman has opened the portals to the study
of great wealth) and his now retired Berkeley colleague Robert Reich
(not strictly an economist but an economic-policy maven par
excellence, as well as a former secretary of labor and a co-founder of
this magazine).
_MORE FROM HAROLD MEYERSON
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The ballot measure they unveiled is an emergency billionaires’ tax
aimed at making up the $100 billion hit to California’s Medicaid
program over the next five years that the Republican Congress and
President Trump delivered by enacting their One Big Beautiful Bill
that disproportionately cut taxes on the wealthy and reduced federal
allotments for Medicaid. If it qualifies for the November 2026 ballot
and is enacted by state voters, the initiative would levy a 5 percent
tax on the wealth of the state’s roughly 200 billionaires and direct
90 percent of those funds to California’s Medicaid recipients and
the institutions that serve them, with the remaining 10 percent going
to the state’s K-12 schools. (This latter provision likely ensures
the support, or at least the neutrality, of the state’s teachers
unions, which are accustomed to seeing schools getting 40 percent of
any state tax increases.)
The stated purpose of this measure is to address what will surely be a
crisis for many Medicaid recipients and the hospitals and clinics that
treat them, where many of SEIU UHW’s members work. But its
implications, at a time when the fortunes of the very wealthy are
reaching stratospheric levels even as median incomes are largely
stagnant and public funding is under attack, may have even greater
significance. It comes at a time when proposals to hike taxes on the
very rich (something that polls have long shown to be popular) are
beginning to bubble up. In France, Saez’s frequent collaborator
Gabriel Zucman has proposed a wealth tax to close the nation’s
budget gap that the conservative government would like to diminish by
reducing public services. In New York City, Democratic mayoral nominee
Zohran Mamdani wants to raise the income taxes of residents with
annual incomes in excess of $1 million by 2 percent in order to fund
universal child care. Such proposals have raised unsurprising
objections from the very rich and those who love (or at least, work
for) them: chiefly, that they will compel them to move elsewhere and
deter their fellow plutocrats from moving in—even though
the evidence
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that actually happening is extremely scarce.
The California proposal neatly avoids such eventualities. First, it is
a one-time-only tax, to be levied exclusively on billionaires’
current (i.e., 2025) net worth. Even if they move to Tasmania, they
will still be liable for 5 percent of this year’s net worth.
Moreover, they can stretch out their payments over the next five
years, though their payments will still be based just on their 2025
wealth.
During today’s press conference, Saez noted that the billionaires’
average yearly income has been rising by 7.5 percent (as against the
1.5 percent for median-income residents), so that they will still be
growing wealthier even after that 5 percent tax is factored in. Saez
added that about 72 percent of the billionaires’ wealth is in their
ownership of publicly traded stock, so those sums are readily
calculable (there are Swiss and Swedish models for calculating the
value of privately held enterprises). As with their payment of income
taxes, the billionaires will file their wealth taxes themselves in
2027, assuming the measure is enacted the previous November, based on
their net worth in 2025. The state can audit those returns if its
estimates of their fortunes are significantly at variance with those
filings.
Crucially, the tax won’t crimp the fortunes of any billionaire who
moves into the state next year or any later year, as it only applies
to the billionaires living in the state this year. Therefore, the
objections lodged against both the Mamdani and the Zucman taxes—the
horrific specter of billionaire flight—can’t be levied against the
California proposal. That’s not to say the proposal won’t be
attacked as socialistic, of course. But by directing the funds the
measure would yield to the 15 million Californians on Medi-Cal (the
state’s version of Medicaid) at a time when their access to health
care is on the brink of being either reduced or eliminated due to the
cutbacks imposed by Trump and congressional Republicans, who
redirected those funds to massive tax cuts for the rich, the
measure’s sponsors can be reasonably confident that state voters
will enact it. (They have until June to collect the required number of
valid signatures—roughly 874,000—to place it on the November 2026
ballot.)
The spillover effects of its presence on the midterm-election ballot
should be considerable. Democratic candidates, I suspect, will endorse
it enthusiastically; conservative billionaires seeking public office,
which could well include gubernatorial hopeful Rick Caruso, may find
themselves compelled to support it. Democrats in states and cities
that are also home to the very rich may well opt to enact similar
proposals, whether through legislation or at the ballot box.
As Saez noted, the carefully devised limitations on the California
initiative—confining its applicability to just 200 taxpayers and its
time frame to a one-and-done one-year assessment—mean that it
doesn’t address the metastatic growth of economic inequality as
such. It certainly does nothing to restore the highest-bracket income
tax rate of 91 percent reached during the presidency of socialist
(well, Republican) Dwight Eisenhower, during whose 1950s tenure the
wealth and income of ordinary Americans saw record increases.
Nonetheless, it opens the door to further efforts to rein in the
current redistribution of income and wealth to the very, sometimes
obscenely, rich—efforts that are essential to preserving democracy.
_HAROLD MEYERSON is editor at large of The American Prospect._
_Used with the permission. THE AMERICAN PROSPECT, Prospect.org, 2025.
All rights reserved. Click here
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* wealth tax
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* California
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* SEIU
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* Medicaid
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* Billionaires
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* elections
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* Economic Policy
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