California isn't pushing the billionaire tax initiative, it's a Proposition that has been brought forward by specific union and interest groups. The state is largely against it. It's not indicative of CA as a state, but more that there is a segment of the population frustrated that they are being left behind and lashing out in more and more aggressive ways.
Until we have solutions for the rising costs across fuel, housing, education, etc. these groups will grow in size and power. The system is not working for them, and they aren't going to just calm down and accept it.
We have the 6th worst income inequality, as measured by GINI Index, among OECD countries. Among the entire world, our income inequality is similar to countries like Haiti, Papua New Guinea, and Bolivia. This was not always the case. Going back, we were similar to Canada. a little higher, but not much. In 1979, we were at 34.8 and they were at 33.5. Now, we are at 41.8 and Canada is 31.5.
So, yes, I agree that "the pie" is always expanding as you say. It's not a finite amount, but even as that pie grows, more and more of this ever expanding pie is going to the largest asset holders. People are mad. The California plan (which I think I will vote against) is a ballot initiative, not sponsored by any government agency. I am a homeowner in California and I benefit from very generous tax laws for property owners. The system is so rigged towards owners that we have to raise taxes in every other way imaginable to make up for it and It's a driver of our housing crisis. The way our property tax system is set up, if I sell my house to downsize when I retire and stay in California, I will pay significantly higher taxes on the new home, so why leave?
The New York tax is on second homes owned by non-residents of the city. These are homes that largely sit empty, yet still drive up prices, in a city desperate for housing. Also, look into the property tax rules for these apartments. They are taxed based on what the owners say they can get in rent, not what it's actually worth on the market.
Trying to punish billionaires for being billionaires feels good but does nothing. They are beyond consequences, financially or otherwise (another reason not to concentrate wealth). Read Noah Hawley's essay in The Atlantic about his encounter with the billionaire class for more about this. I don't agree with wealth taxes and the like, but something significant has to be done. We are not heading to a good place. We are heading towards income inequality experienced by some of the poorest nations in the world.
This is a thoughtful comment, thanks Rob, one of the better I've heard in this discussion when we've had it in varying forms.
The California RE situation is incredibly poor for young homebuyers, it's actually one reason (among many) we left for Texas. It always felt to me like they wanted to be a retirement community where I lived in Norcal. Where we are now I've never been more optimistic for the future of my local community and that helps me be optimistic for America.
The U.S. remains one of the few large economies where meaningful upward mobility through entrepreneurship, tech, or even just switching markets is still very real. People still routinely go from zero to outsized outcomes here in a way that’s much rarer elsewhere. I hope we don't do anything to lose that magic. And you don't even need to be a billionaire to have a very good life here, the constant comparison on social media certainly isn't helping.
At the heart of the left are two core issues: envy and stupidity. Yet the irony is that socialism actually leads to elites at the top making bank while the poor plebs suffer for their policy choices. Mamdami and the Seattle mayor come from money. They’ve never had to start a business and make payroll.
These guys are playing the wrong tax game. WA, CA, NY, IL, NJ, MA are the handful of states that send an excess amount of federal tax dollars to DC who receive pennies on the dollar back in spending. NJ is around .83 cents where Kentucky gets almost $2.28 back for every dollar they send.
Tie the federal funds received to inflation and let more money compound in the states providing the big federal dollars. Let the welfare states across the midwest and south figure it out.
This is a fantastic analysis. Reminds me of my neighbor in my very blue town that has both a sign welcoming everyone to be a citizen and a sign that decries the apartment complex being built a couple of blocks away. NIMBYs want their cake and to eat it also. They will increasingly get neither as producers take their money and ideas to places that will allow them to produce.
Taxes are how we fund the free-market. People/companies that reap the greatest benefits from free enterprises SHOULD pay into the system that allows them to receive the golden eggs.
Just remember the wealthy already pay the majority of taxes in America. They aren't the enemy. And also if you want them to pay more just change the tax code, don't issue these strange 1-time wealth taxes or unrealized gain taxes which have tons of unforeseen consequences and could also later be used on all of us.
I think there’s a real conversation to be had about whether the tax code should be more progressive, but I also think people dramatically underestimate how much the wealthy already fund the system. The top 1% already pay a hugely disproportionate share of federal income taxes.
More importantly, the bigger question is what kind of incentives we want to create. There’s a difference between saying “successful people should contribute more” and building a political culture that increasingly treats wealth creation itself as suspicious or immoral.
A founder building a company, employing thousands of people, creating products people voluntarily buy, and generating massive tax revenue is not the same thing as exploitation. A healthy economy needs builders, investors, and risk-takers. If policy starts signaling that success will simply be punished more aggressively every time someone succeeds, eventually fewer people will build, or they’ll build somewhere else.
"The top 1% already pay a hugely disproportionate share of federal income taxes."
Good. They have the means and a moral obligation to. They probably should be paying more. That's a policy discussion, however.
"More importantly, the bigger question is what kind of incentives we want to create. There’s a difference between saying “successful people should contribute more” and building a political culture that increasingly treats wealth creation itself as suspicious or immoral.
Yes, we should create incentives for investment — especially incentives created on a level playing field, administered by an impartial third-party. That is not what we have today (see: Secretary of Transportation, Sean Duffy, taking his family on a *seven-month* roadtrip sponsored by the very entities he's to regulate: https://thehill.com/homenews/5873035-watchdog-group-calls-for-probe/, among 1,000 other examples from this administration).
The issue with your last clause "building a political culture that increasingly treats wealth creation itself as suspicious or immoral," and (I suspect) the central premise of your piece, is that you seem to suggest that wealth and wealth creation is formed in a vacuum; that any wealth creation is a net-good.
Now, gambling is an easy example, but we can expand this critique to other forms of wealth creation as well. For example, the Sackler family, Purdue Pharma and their respective roles in OxyContin and the opioid crisis.
Appreciate the comment Michael good addition to this discussion - you might be surprised to learn I am not pro gambling startups (and ofc def not pro pushing addictive pharmaceuticals). I think there should be whole different set of regulations for that, and I would not stand in the way of taxing that higher.
But the constant demonization of "the rich" as a talking point that people use politically is a bad one we should stop doing. There's so much nuance in this debate and I feel like it's lost when politicians do that.
Sure, taxes are part of doing business. Nobody is arguing otherwise. The question is whether there’s a point where policy becomes actively hostile to investment, risk-taking, and building. Also for individuals we know the Laffer curve is very real and people leave after a certain point.
There’s a difference between a stable tax system people can plan around and things like one-time wealth taxes or taxes on unrealized gains that create major second-order effects. Capital and talent are mobile. States and countries compete for them whether we like it or not.
And while companies do use deductions and write-offs, those exist largely to encourage reinvestment, expansion, hiring, R&D, equipment purchases, etc. The goal of a healthy tax code shouldn’t just be maximizing extraction. It should be maximizing long-term prosperity and growth.
Cool. Now do all of the people with an R by their name. You never will. You’re extremely ideological but continuously feign indignation when people point it out.
We can absolutely critique any political actor, but “both sides” isn’t a substitute for engaging a specific claim. Ideological towards veritas - yes, absolutely
California isn't pushing the billionaire tax initiative, it's a Proposition that has been brought forward by specific union and interest groups. The state is largely against it. It's not indicative of CA as a state, but more that there is a segment of the population frustrated that they are being left behind and lashing out in more and more aggressive ways.
Until we have solutions for the rising costs across fuel, housing, education, etc. these groups will grow in size and power. The system is not working for them, and they aren't going to just calm down and accept it.
Thanks good catch Sean - I updated that paragraph for accuracy - and you're right about the second part of this too
We have the 6th worst income inequality, as measured by GINI Index, among OECD countries. Among the entire world, our income inequality is similar to countries like Haiti, Papua New Guinea, and Bolivia. This was not always the case. Going back, we were similar to Canada. a little higher, but not much. In 1979, we were at 34.8 and they were at 33.5. Now, we are at 41.8 and Canada is 31.5.
So, yes, I agree that "the pie" is always expanding as you say. It's not a finite amount, but even as that pie grows, more and more of this ever expanding pie is going to the largest asset holders. People are mad. The California plan (which I think I will vote against) is a ballot initiative, not sponsored by any government agency. I am a homeowner in California and I benefit from very generous tax laws for property owners. The system is so rigged towards owners that we have to raise taxes in every other way imaginable to make up for it and It's a driver of our housing crisis. The way our property tax system is set up, if I sell my house to downsize when I retire and stay in California, I will pay significantly higher taxes on the new home, so why leave?
The New York tax is on second homes owned by non-residents of the city. These are homes that largely sit empty, yet still drive up prices, in a city desperate for housing. Also, look into the property tax rules for these apartments. They are taxed based on what the owners say they can get in rent, not what it's actually worth on the market.
Trying to punish billionaires for being billionaires feels good but does nothing. They are beyond consequences, financially or otherwise (another reason not to concentrate wealth). Read Noah Hawley's essay in The Atlantic about his encounter with the billionaire class for more about this. I don't agree with wealth taxes and the like, but something significant has to be done. We are not heading to a good place. We are heading towards income inequality experienced by some of the poorest nations in the world.
This is a thoughtful comment, thanks Rob, one of the better I've heard in this discussion when we've had it in varying forms.
The California RE situation is incredibly poor for young homebuyers, it's actually one reason (among many) we left for Texas. It always felt to me like they wanted to be a retirement community where I lived in Norcal. Where we are now I've never been more optimistic for the future of my local community and that helps me be optimistic for America.
The U.S. remains one of the few large economies where meaningful upward mobility through entrepreneurship, tech, or even just switching markets is still very real. People still routinely go from zero to outsized outcomes here in a way that’s much rarer elsewhere. I hope we don't do anything to lose that magic. And you don't even need to be a billionaire to have a very good life here, the constant comparison on social media certainly isn't helping.
At the heart of the left are two core issues: envy and stupidity. Yet the irony is that socialism actually leads to elites at the top making bank while the poor plebs suffer for their policy choices. Mamdami and the Seattle mayor come from money. They’ve never had to start a business and make payroll.
These guys are playing the wrong tax game. WA, CA, NY, IL, NJ, MA are the handful of states that send an excess amount of federal tax dollars to DC who receive pennies on the dollar back in spending. NJ is around .83 cents where Kentucky gets almost $2.28 back for every dollar they send.
Tie the federal funds received to inflation and let more money compound in the states providing the big federal dollars. Let the welfare states across the midwest and south figure it out.
This is a fantastic analysis. Reminds me of my neighbor in my very blue town that has both a sign welcoming everyone to be a citizen and a sign that decries the apartment complex being built a couple of blocks away. NIMBYs want their cake and to eat it also. They will increasingly get neither as producers take their money and ideas to places that will allow them to produce.
Taxes are how we fund the free-market. People/companies that reap the greatest benefits from free enterprises SHOULD pay into the system that allows them to receive the golden eggs.
https://www.instagram.com/reel/DYGNXdeAlpr/?igsh=MTcxcm42NnM1OWRpeQ==
Just remember the wealthy already pay the majority of taxes in America. They aren't the enemy. And also if you want them to pay more just change the tax code, don't issue these strange 1-time wealth taxes or unrealized gain taxes which have tons of unforeseen consequences and could also later be used on all of us.
Every time the tax code has been changed, since the 1960's, it has been to the benefit of the wealthy and the detriment of everyday working Americans.
I think there’s a real conversation to be had about whether the tax code should be more progressive, but I also think people dramatically underestimate how much the wealthy already fund the system. The top 1% already pay a hugely disproportionate share of federal income taxes.
More importantly, the bigger question is what kind of incentives we want to create. There’s a difference between saying “successful people should contribute more” and building a political culture that increasingly treats wealth creation itself as suspicious or immoral.
A founder building a company, employing thousands of people, creating products people voluntarily buy, and generating massive tax revenue is not the same thing as exploitation. A healthy economy needs builders, investors, and risk-takers. If policy starts signaling that success will simply be punished more aggressively every time someone succeeds, eventually fewer people will build, or they’ll build somewhere else.
"The top 1% already pay a hugely disproportionate share of federal income taxes."
Good. They have the means and a moral obligation to. They probably should be paying more. That's a policy discussion, however.
"More importantly, the bigger question is what kind of incentives we want to create. There’s a difference between saying “successful people should contribute more” and building a political culture that increasingly treats wealth creation itself as suspicious or immoral.
Yes, we should create incentives for investment — especially incentives created on a level playing field, administered by an impartial third-party. That is not what we have today (see: Secretary of Transportation, Sean Duffy, taking his family on a *seven-month* roadtrip sponsored by the very entities he's to regulate: https://thehill.com/homenews/5873035-watchdog-group-calls-for-probe/, among 1,000 other examples from this administration).
The issue with your last clause "building a political culture that increasingly treats wealth creation itself as suspicious or immoral," and (I suspect) the central premise of your piece, is that you seem to suggest that wealth and wealth creation is formed in a vacuum; that any wealth creation is a net-good.
I contest that.
For example, Kalshi and Polymarket — both job creators, both tax payers, both wealth creators — are a net negative on our society. For one, they're predatory and enable people with gambling problems (https://nautil.us/how-gambling-addiction-is-changing-in-a-polymarket-world-1265523). For another, they provide perverse incentives to fix bets (https://www.npr.org/2026/04/10/nx-s1-5780569/betting-polymarket-iran-investigation-lawmakers; https://www.justice.gov/opa/pr/us-soldier-charged-using-classified-information-profit-prediction-market-bets; https://www.wsj.com/business/unusual-weather-bets-on-polymarket-spur-french-investigation-b799bec8). Finally, the wealth that *is* created by these digital casinos is limited; yes, they pay taxes and employ people, some people win big, they don't build anything — they just transfer wealth.
Now, gambling is an easy example, but we can expand this critique to other forms of wealth creation as well. For example, the Sackler family, Purdue Pharma and their respective roles in OxyContin and the opioid crisis.
Appreciate the comment Michael good addition to this discussion - you might be surprised to learn I am not pro gambling startups (and ofc def not pro pushing addictive pharmaceuticals). I think there should be whole different set of regulations for that, and I would not stand in the way of taxing that higher.
But the constant demonization of "the rich" as a talking point that people use politically is a bad one we should stop doing. There's so much nuance in this debate and I feel like it's lost when politicians do that.
That is the cost of doing business.
These are the price of entry into the free market: FICA, STATE, LOCAL, FED Taxes, SS, UI, etc. Etc.
A business owner assumes and accepts these as part and parcel to ownership.
Also companies get to write a fair amount of these off, before profits and afterwards, to write down their gains.
Sure, taxes are part of doing business. Nobody is arguing otherwise. The question is whether there’s a point where policy becomes actively hostile to investment, risk-taking, and building. Also for individuals we know the Laffer curve is very real and people leave after a certain point.
There’s a difference between a stable tax system people can plan around and things like one-time wealth taxes or taxes on unrealized gains that create major second-order effects. Capital and talent are mobile. States and countries compete for them whether we like it or not.
And while companies do use deductions and write-offs, those exist largely to encourage reinvestment, expansion, hiring, R&D, equipment purchases, etc. The goal of a healthy tax code shouldn’t just be maximizing extraction. It should be maximizing long-term prosperity and growth.
There is no war on builders, but there has been an assault on public budgets due to tax cuts for the past 40 years so something has to give.
And FYI, neither you nor the people you exalt are John Galt or Howard Roark….quite far from it.
The Rand heroes are fiction but the villains are absolutely real
Yet you’re unwilling or unable to identify and name the *actual* major villains which is why this is intellectually shallow.
I listed several people in this story. Here's a whole other piece of reporting on Dave Regan (leader of the Calif union proposing their wealth tax). Textbook villain https://www.piratewires.com/p/who-wrote-california-wealth-tax-proposal
Cool. Now do all of the people with an R by their name. You never will. You’re extremely ideological but continuously feign indignation when people point it out.
It’s your entire schtick post 2024.
We can absolutely critique any political actor, but “both sides” isn’t a substitute for engaging a specific claim. Ideological towards veritas - yes, absolutely
There is no both sides to you though. You’re as partisan as they come. (See: feigning indignation) It is what it is.