Newsom breaks with socialists over billionaire tax, and California voters appear poised to reject it
In the lead-up to the November midterms, the Democratic Socialists of America (DSA) put its support behind California’s Proposition 40, a measure that would impose a one-time 5% tax on...
By Fox News · Fox News
In the lead-up to the November midterms, the Democratic Socialists of America (DSA) put its support behind California’s Proposition 40, a measure that would impose a one-time 5% tax on billionaires in the state. Although the secretary of state's election results show it on the path to defeat as of Wednesday afternoon, the DSA’s support for the policy has created a flashpoint for larger discussions about socialism's redistributive aims and the capital flight critics say could follow. "In their mind, every tax they do is some attempt to get money from people who create wealth and move it to the state," Richard Stern, an economics scholar with Advancing American Freedom (AAF), said in an interview with Fox News Digital. The DSA's stance on Proposition 40 has also brought it into conflict with other Democratic figures, including Gov. Gavin Newsom , who opposed it. SHOCKING PERCENTAGE OF DEMOCRATS IDENTIFY AS 'DEMOCRATIC SOCIALISTS' ACCORDING TO NEW POLL: 'TOXIC POLICIES' The proposition would have applied a 5% tax on assets like businesses, securities, art, collectibles and intellectual property while excluding select pensions, real estate and retirement accounts. To prevent billionaires from simply leaving the state, Proposition 40 was designed to retroactively apply to billionaires who were residents of California on Jan. 1, 2026. On the website for its California chapter, the group offered a PowerPoint slideshow supporters could use to argue its merits. "We have the money in California to pay for the quality schools and healthcare that we need. It just needs to be transferred from the wrong pockets to the right ones. We can do that by taxing the rich," the slideshow reads. The DSA argued the policy would help cover up to a projected $100 billion shortfall in federal funding for the state’s Medi-Cal program that provides health insurance for low-income individuals, seniors and people with disabilities. The proposition also outlined that 90% of the…