Tom Bilyeu

Many people would have to sell the very things that they own in order to pay the tax.

It's patently absurd.

Critics, including the Tax Foundation, argue the effective rate will end up grossly exceeding 5% because the aggressive valuation rules, limited deductions, and the inclusion of illiquid assets would force people to sell at depressed prices.

So instead of it being 5%, it goes way up because it was 5% on a theoretical number that you didn't actually get when you did the sales.

Proponents such as economist Emmanuel Sayes frame it as an equitable, all my alarm bells go off, emergency tax on those who have benefited most from California's economy.

Opponents, including Governor Newsom and groups like the Tax Foundation, argue it is poor policy that discourages investment

you think, and innovation will cause current and future generations of entrepreneurs to seek more friendly jurisdictions.

Talk about not understanding second and third order consequences.

This is going to permanently depress the tax base of California.

Opponents rightly point out that wealth taxes have failed spectacularly in Europe and the odds that this actually lowers the long-term tax revenue in California borders on 100%.

As of January 16, 2026, the initiative is in signature gathering mode and thankfully has not yet qualified for the ballot.

Newsom predicts defeat.

praise be to Jesus, citing bad economics, but union backing could mobilize voters amid inequality concerns.

If it passes, enforcement would begin in 2027.

Now, nobody is more concerned about inequality than myself.

Inequality is always going to be present, but there is what I'll call toxic inequality, unsustainable inequality, whatever you want to say.

But there is a threshold beyond which society begins to tear itself apart.

This is how empires collapse.

They always collapse from within.

And this is how it happens.