California Gov. Gavin Newsom, a Democrat who is considering a run for president as he approaches the end of his term, called for a national "billionaires' tax" on Friday even as he fights another proposal targeting the wealthy in his home state.
Newsom also said the U.S. government should own a stake in artificial intelligence companies. His proposals, outlined in a Substack post, align him with the Democratic Party's populist left, and he argued that urgent changes are needed to prevent the elite concentration of wealth and power from undermining democracy.
What the Right Is Saying
Conservative critics argue that Newsom's proposals would harm economic growth and drive successful individuals and businesses out of California and the United States. They note that the governor is simultaneously fighting a state-level billionaire tax in his own state, suggesting political calculation over genuine policy conviction.
"You may not be able to pick up and move to Texas or Florida to shelter your income from taxation, but I promise you that billionaires can, and do," Newsom acknowledged in his post. "Wealth is movable, and it shops for the state with the lowest taxes."
Opponents of wealth taxes point to the complexity of valuing illiquid assets, potential constitutional issues, and concerns about double-taxation. Business groups have warned that such measures could drive investment capital and entrepreneurship toward more tax-friendly jurisdictions, both domestically and internationally.
Some political observers note that Newsom's proposals come as he positions himself for a potential presidential bid, suggesting the policies may be designed to appeal to progressive primary voters rather than represent settled governing philosophy.
What the Left Is Saying
Progressive Democrats have long advocated for taxing extreme wealth, and many welcomed Newsom's shift toward their position. The governor's proposal echoes measures championed by Sen. Bernie Sanders, I-Vt., and aligns with the wealth tax framework that Massachusetts Sen. Elizabeth Warren pushed during her 2020 presidential campaign.
"It's time for an economic reset for America," Newsom wrote in his Substack post.
Newsom called for a minimum tax on anyone with a net worth above $100 million, making it illegal for wealthy individuals to borrow against their stock portfolios to fund lifestyles tax-free. He also wants new inheritance tax rules to prevent what he described as "a permanent American aristocracy of inherited wealth."
The governor argued that the concentration of wealth poses an existential threat to democracy itself. "Money buys influence, and influence rewrites the rules," he wrote. "Those rewritten rules funnel even more wealth to the few. Under this weight, democracy itself starts to buckle."
What the Numbers Show
California has more billionaires than any other state, with estimates ranging into the hundreds. The proposed state-level measure backed by SEIU United Healthcare Workers West would impose a one-time 5% tax on the assets of billionaires living in California as of January 1, 2026.
Newsom wants to raise corporate tax rates to where they were before President Donald Trump's first-term tax cuts. He has not specified what revenue projections he expects from his proposals.
The governor called for a national public equity fund that would give every American a stake in AI development. Under this framework, the government would take "a major stake" in artificial intelligence companies, though specific implementation details remain unclear.
The Bottom Line
Newsom's proposal represents a notable shift toward progressive tax positions by a politician known for moderate stances on fiscal policy. His argument that state-level wealth taxes are ineffective because billionaires can relocate puts him at odds with the SEIU-backed ballot measure moving forward in California.
The governor is positioning himself as a potential 2028 presidential candidate, and his proposals signal an attempt to compete for progressive voters who may seek more aggressive economic policies than President Trump has pursued. The tension between his national ambitions and his state's immediate fiscal debates illustrates the challenge of implementing wealth taxes across different governmental levels.
What happens next: The SEIU ballot measure will face voter approval in a future California election, while Newsom's federal proposals would require congressional action that faces significant political obstacles under the current administration.