California’s proposed “wealth tax” would punish success

On February 18, Bernie Sanders spoke to a crowd at The Wiltern in Los Angeles and called out Sergey Brin, Mark Zuckerberg, and other billionaire California residents. Not for anything they’ve done wrong, but for being good at their job and generating billions of dollars with their companies.

The Senator from Vermont came all the way to California to campaign for the proposed billionaire tax, an initiative that would impose a one-time 5% tax on the net worth of Californians with wealth exceeding $1 billion. Many have criticized the proposal for practical reasons, but the fundamental reason why this tax should be criticized is because it’s immoral.

The proposed tax would become due in 2027 and apply to billionaires living in California as of January 1, 2026 and could be paid in installments over five years with a deferral charge. 90% of the revenue would be spent on public health care services (recently gutted by federal cuts), with the remainder going toward administration, education, and food assistance. The measure targets roughly 200 billionaires.

The core argument behind the tax is rooted in that billionaires allegedly don’t pay their “fair share” in taxes. Per the framers of the proposal, they pay “only” 1.5% of their total wealth in annual taxes, even when they “collectively possess an astonishing $2 trillion in wealth” which they’ve procured “with the help of California resources.” The framers claim that other Californians pay a bigger portion of their income in taxes, and that many are increasingly struggling due to failing government services. It is, therefore, “necessary and equitable” to force billionaires to pay more to sustain failed government programs.

The proponents of this legislation, including Sanders, imply that billionaires’ fortunes were handed to them, not created— that they didn’t earn their wealth, and that they shouldn’t even exist, per Sanders himself. In this worldview, taxing billionaires is “necessary” because they are a drag on society— parasites that somehow have managed to amass wealth that should actually go to sustain others for some reason.

This animosity is rooted in a complete disregard of the facts. Most billionaires, including those named by Sanders, have earned their fortunes by producing values that consumers are willing to pay for. Zuckerberg invented Facebook in his dorm room and managed to grow it to over three billion users worldwide. That’s close to 40% of the world population who voluntarily engages with and benefits from Facebook’s services. Sergey Brin co-founded Google and brought untold innovation to the internet and enabled easy access to information for everyone with an internet connection. These billionaires earned their wealth by producing massive value for users, not by looting. Sanders claims billionaires shouldn’t exist, but if he got his way, our lives would be worse off in many respects.

The ultra-wealthy have become the all-purpose scapegoat of progressive politics. Whatever the crisis (in the case of California, failing healthcare, housing costs, underfunded schools) the answer is always the same: billionaires are to blame, and making them pay is the solution. The logic is never clearly explained, because it doesn’t have to be: scapegoating doesn’t require an argument.

The wealth tax would punish people not for what they’ve done wrong, but for how much they’ve produced; for being good at their jobs and creating their own wealth through win-win trades with consumers. Punishing people for their virtues is the essence of injustice. Billionaire producers, primarily through the pursuit of their own ambition, have created massive value and pushed humanity forward in myriad ways. We don’t have to agree with everything they do, or even use their products, to recognize this fact.

Contra Sanders, Gov. Gavin Newsom opposes the tax because he thinks that it will reduce “investments” in many areas in the long term. “I fear the way this [proposal] has been drafted,” Newsom said at an event in San Francisco on January 29. “[The proposal will] actually reduce investments in education. . . in teachers and librarians, childcare. . . in firefighting and police,” he elaborated. “The impact of a one-time tax does not solve an ongoing structural challenge.” Newsom further added: “over the years, you would see a significant reduction in taxes because taxpayers will move. And that is what I fear at a state level.”

But Newsom’s concern doesn’t lie on the immorality of punishing the successful for being successful, but on the fact that, if they’re driven away from California, he won’t be able to continue extracting their wealth via exorbitant taxes that already exist. Like a vampire who leaves his victims barely alive so that they can recover and be preyed on again, Newsom wants to keep billionaires here to prop up his own government, with zero concern over injustice.

Californians shouldn’t enshrine the notion that producing “too much” is a punishable offense and immoral. This is America — we should celebrate value creation and reward production, not chastise and disincentivize it by targeting the productive and deeming their very existence a threat.

Agustina Vergara Cid is a columnist for the Southern California News Group. Follow her on X: @agustinavcid