California Billionaires Launch Ads Against Wealth Tax


California billionaires are used to having their way, but they have failed in their attempts so far to kill a wealth tax ever since the idea surfaced late last year.

Now, with the measure qualified for the November ballot, the fight is entering its quintessentially Californian phase as a spectacularly expensive media war unfolds. And some billionaires are ready to spend heavily to convince voters to stop the tax on their assets.

A campaign backed by Sergey Brin, a co-founder of Google, launched its debut ad on Tuesday, the first of what’s set to be more than $90 million worth of initiative spending this year.

It’s a staggering outlay, more than 11,000 times the amount of airtime reserved by supporters of the billionaire tax, known as Proposition 40. Tax proponents have booked just $8,000 in advertising so far.

The initiative, backed by a health care workers union, would impose a one-time 5 percent tax on California residents with a net worth of at least $1 billion. If approved by voters, it would be the first tax in the nation levied on a person’s total wealth, including stocks, trusts and personal possessions.

Mr. Brin, with an estimated personal net worth of $275 billion, enjoys a massive financial advantage over supporters of Proposition 40.

The opposition campaign backed by his organization, Building a Better California, began Tuesday with a blue-collar pitch. The first ad emphasizes that unions representing teachers and firefighters oppose the tax, along with the state’s top politicians, including Gov. Gavin Newsom, a Democrat.

The ad makes no mention of the billionaires who vigorously oppose the tax.

The campaign supporting the tax, however, believes it has a valuable advantage: a network of Democratic Party activists and union members who will help push its message to millions of voters.

“We’re not going to try to compete at all with the billionaires on broadcast television,” said Dave Regan, president of SEIU-United Healthcare Workers West, the union that proposed the billionaire tax. “They have the money. We don’t.”

Instead, Mr. Regan said, the union plans to spread its message through text messages, social media, door-knocking and slate mailers, making the most of the powerful endorsements it recently won from the California Democratic Party and the California Federation of Labor Unions.

Besides fund-raising, the efforts by billionaire opponents of the tax have not gone well to date.

After the proposal was filed with the state last fall, Silicon Valley executives sent a flurry of messages in group chats discussing how it could be defeated. Some billionaires, such as Mr. Brin, even left California ahead of a Dec. 31 deadline to avoid the tax itself, which would apply retroactively. Mr. Newsom said in a recent podcast interview that he knew of 12 people who had fled the state because of the tax.

The billionaires organized chaotically. There were originally several billionaire-funded, at-times rivalrous, efforts to defeat the tax this year. But people involved in those bygone efforts say power and money have consolidated in recent months around Mr. Brin, a political neophyte, and his right-hand strategist, a ballot initiative veteran named Ned Wigglesworth, through Building a Better California.

Mr. Brin over the ensuing months would put $102 million of his own money into the nonprofit and help recruit donors who would invest another $54 million. Millions came this month from John Doerr, a longtime Google board member who has donated $17.5 million, and Chris Larsen, a prominent crypto executive who has given $12.5 million.

There has been frustration among the state’s billionaire class that it has failed in its various efforts to stop the tax thus far.

First, the billionaire opponents tried driving up the price for initiative signatures in an effort to make it too expensive for Mr. Regan’s coalition to qualify its measure, even floating the idea of buying their own signature-collection firm. Then, they tried to pressure Mr. Newsom, who opposed the tax, to kill the measure through negotiations with the health care union.

And once the measure reached the ballot, they unsuccessfully tried to persuade California Democratic Party officials not to endorse it this summer.

Two measures on the ballot, Propositions 41 and 42, could neuter the billionaire tax because they contain provisions that directly conflict with it. Mr. Brin’s organization is backing both so-called countermeasures. The more than $90 million in advertising his group has reserved will be used to support those measures and oppose the billionaire tax.

Abby Lunardini, a spokeswoman for Building a Better California, said that the group’s “focus has squarely been on qualifying and passing” Propositions 41 and 42 and dismissed the notion that her group had failed to stop the billionaire tax measure. But she also called the tax initiative an “ill-conceived and risky measure” that would ultimately cost the state revenues.

Some of the billionaires opposed to the tax trusted Mr. Newsom to successfully find an off-ramp. In a conversation with the governor this spring, a major donor understood Mr. Newsom to have expressed confidence that he could negotiate the tax off the ballot, according to two people briefed on the conversation.

Izzy Gardon, a spokesman for Mr. Newsom, said that he would not comment on private conversations but emphasized that the governor had attempted to negotiate the measure off the ballot. “We tried,” he said. “It’s well known and well documented.”

Building a Better California did not officially come out against the billionaire tax until this month and so far has contributed $13.5 million to the opposition effort. Until August, most of the group’s activities were focused on its two countermeasures.

Mr. Regan said that big spending on television ads doesn’t always lead to a win on the ballot. He pointed to the record-breaking spending by Tom Steyer, a billionaire who flooded the airwaves with more than $200 million in ads only to come in third place in the top-two primary for governor.

“We think that tells you something about where voters are at,” Mr. Regan said. “People see through that, this omnipresent barrage of television ads.”

It is not yet clear if Mr. Newsom will participate in any of the ads against Proposition 40 despite having been a vocal opponent. The governor, who is weighing a 2028 presidential bid, has said he opposes the measure because he believes it puts California at a competitive disadvantage and believes billionaires should be taxed more by the federal government.

While his position may help him avoid attacks from Republicans and moderate Democrats, being the face of the opposition could hurt him if a surging wave of progressivism proves decisive in his party’s primary.

A California business group, Californians Against Wasteful Spending and Higher Taxes, has already launched television ads against Proposition 40 and booked nearly $4 million in ads. The commercials argue that the initiative would open the door for the state to tax the assets of all Californians, which tax supporters dispute.

Another campaign is forming to support Proposition 40, focused on getting voters to see the California billionaire tax as a first step in a broader agenda to address wealth inequality. It’s meant to complement the official campaign, which is focusing on how the tax will offset cuts to health care.

“This is really a story not just about Medi-Cal and hospitals, but a story about who has control over our future,” said ​​Igor Volsky, campaign director for the new group, Tax the Greedy Billionaires.



Source link

  • Related Posts

    US Secret Service ‘aware’ of Iran video threat against Barron Trump, spokesperson says

    The U.S. Secret Service is “aware” of a threatening video posted by the Iranians directed at President Donald Trump’s youngest son, Barron, according to an agency spokesperson.  “The U.S. Secret…

    Multiple people dead, including kids, after shooting and fire at Montana home

    Multiple people, including children, were killed in a shooting and fire that broke out inside of a Billings, Montana, home on Sunday evening, according to authorities and local media reports. …

    Leave a Reply

    Your email address will not be published. Required fields are marked *

    You Missed

    Apple’s latest Mac Mini runs on a new M6 chip, and starts at $899

    Apple’s latest Mac Mini runs on a new M6 chip, and starts at $899

    U.S. Launches New Iran Sanctions Campaign Targeting Shipping

    U.S. Launches New Iran Sanctions Campaign Targeting Shipping

    Minister Sidhu meets with Ireland’s Minister for Enterprise, Tourism and Employment

    Trump’s tariffs risk higher prices for AI, video games, cellphones: experts

    Trump’s tariffs risk higher prices for AI, video games, cellphones: experts

    Supercharged “natural killer” cells could be a powerful new cancer weapon

    Supercharged “natural killer” cells could be a powerful new cancer weapon

    Two die of measles in Pennsylvania outbreak, health officials say

    Two die of measles in Pennsylvania outbreak, health officials say