Silicon Valley built an empire on California soil.
Now the state is trying to confiscate it.
And California unions just made one lethal mistake that sent billionaires running.
Tech Founders Warned They're "Screwed For Life" Under Union Scheme
A healthcare union just declared war on the people who created California's wealth.
The Service Employees International Union-United Healthcare Workers West is pushing a ballot measure that would slap a one-time 5% tax on anyone worth more than $1 billion who lived in California on January 1, 2026.
Someone with $20 billion in assets would owe $1 billion payable over five years.
That's not a typo.
Palmer Luckey, cofounder of defense tech startup Anduril, warned the tax would force "founders like me to sell huge chunks of our companies" to pay for what he called "fraud, waste and political favors for the organizations pushing this ballot initiative."¹
"I made my money from my first company, paid hundreds of millions of dollars in taxes on it, used the remainder to start a second company that employs six thousand people and now me and my cofounders have to somehow come up with billions of dollars in cash," Luckey wrote on X.²
He added that a single market correction could leave him financially ruined for life.
Billionaire investor Bill Ackman called California "on a path to self-destruction" over the measure.³
"Hollywood is already toast and now the most productive entrepreneurs will leave, taking their tax revenues and job creation elsewhere," Ackman posted on X.⁴
The New York Times reported that tech investor Peter Thiel and Google cofounder Larry Page are already making plans to cut ties with California by year's end.⁵
Thiel, worth approximately $27.5 billion, has explored opening an office for his investment firm in another state.⁶
Page, whose net worth sits around $270 billion, has discussed leaving California entirely — and three LLCs associated with him filed incorporation documents in Florida in mid-December.⁷
Democrats Can't Hide Their Socialist Agenda Anymore
The union claims the tax could raise $100 billion to "offset federal funding cuts for healthcare."⁸
Translation: they want billionaires to keep paying for illegal aliens' free medical care now that President Trump is cutting off the federal gravy train.
This has nothing to do with healthcare and everything to do with wealth confiscation.
The tax applies to unrealized gains — paper profits on stocks and private company shares that founders can't even sell.
Tech investor Chamath Palihapitiya warned there will be "no billionaires left in California" if this passes.⁹
"The inevitable outcome will be an exodus of the state's most talented entrepreneurs who can and will choose to build their companies in less regressive states," Palihapitiya posted.¹⁰
"All that will be left behind is the middle class. The tax burden, then, will fall to the middle class because after the 'richest' choose to leave, the middle class are both (a) the only ones left and (b) are the largest source of state income to extract taxes from."¹¹
California already tried this scam before.
In 2023, Assemblymember Alex Lee introduced a similar wealth tax that would have taxed residents' net worth annually.
It died without even getting a hearing because everyone knew it would trigger an immediate exodus.
Now the unions are back with a "one-time" tax.
Anyone who believes this will stay one-time should ask New Yorkers how their "temporary" income tax from 1919 is working out.
Dave Friedberg, cofounder of Ohalo Genetics, called the tax an "organized government seizure of private property from citizens" who already pay up to 53% in combined taxes in California.¹²
He's right — this is socialism dressed up as tax policy.
The Real Victims Won't Be Billionaires
California's top 1% of earners already pay 45% of the state's income tax revenue.¹³
The top 10% pay 80%.¹⁴
These people aren't just sitting on piles of cash — they're running companies that employ millions of Californians.
When Palmer Luckey says he'd have to sell chunks of his company to pay this tax, he's talking about losing control of a defense contractor that employs 6,000 Americans.¹⁵
That's 6,000 jobs Democrats are willing to sacrifice for union political favors.
Even California Governor Gavin Newsom opposed the measure, calling it "not pragmatic" at The New York Times DealBook conference.¹⁶
Newsom knows that driving out the state's biggest taxpayers would crater California's budget faster than you can say "high-speed rail boondoggle."
Blake Scholl, founder of Boom Supersonic, pointed to the billions California wasted on that rail project as evidence the state can't be trusted with more tax revenue.¹⁷
"This is morally wrong and ends poorly for everyone," Scholl wrote about the wealth tax.¹⁸
Trump's America First Policies Make The Choice Easy
For decades, California's high taxes were the price of admission to Silicon Valley's ecosystem.
But Trump's second term changed that calculation completely.
The President eliminated Biden's anti-crypto regulations, launched America's Strategic Bitcoin Reserve, and made the United States the crypto capital of the world.¹⁹
Tech founders can now build in Texas or Florida and get better policies, lower taxes, and less regulatory harassment.
California is trying to squeeze blood from a stone at exactly the moment entrepreneurs have better options than ever.
Garry Tan, CEO of Y Combinator, warned the measure would cause a "stampede of unicorns" out of California, draining the state of technology and jobs.²⁰
The unions pushing this measure think they're punishing rich people.
What they're actually doing is destroying the tax base that funds everything California claims to care about.
When these billionaires leave, they'll take their companies, their employees, their tax payments, and their innovation with them.
And the middle-class Californians who can't afford to flee will be left holding the bag for the state's reckless spending.
¹ Amanda Macias, "Tech billionaires threaten to flee California over proposed 5% wealth tax," Fox Business, December 28, 2025.
² Ibid.
³ Ibid.
⁴ Ibid.
⁵ Ibid.
⁶ Ibid.
⁷ Ibid.
⁸ Ibid.
⁹ "California's billionaires may have 2 choices in 2026: Leave the state or pay $50 million or more," Deseret News, December 23, 2025.
¹⁰ "Peter Thiel and Larry Page are preparing to flee California in case the state passes a billionaire wealth tax, report says," Fortune, December 27, 2025.
¹¹ Ibid.
¹² "California tech founders unload on a proposed state wealth tax that already has some billionaires preparing an escape," Fortune, December 28, 2025.
¹³ "Tech Billionaires Warn of California Exodus as 5% Wealth Tax Sparks Panic," International Business Times, December 29, 2025.
¹⁴ Ibid.
¹⁵ Amanda Macias, "Tech billionaires threaten to flee California over proposed 5% wealth tax," Fox Business, December 28, 2025.
¹⁶ "California Billionaire Exodus Looms Over Wealth Tax Proposal," Grand Pinnacle Tribune, December 28, 2025.
¹⁷ "Peter Thiel and Larry Page are preparing to flee California in case the state passes a billionaire wealth tax, report says," Fortune, December 27, 2025.
¹⁸ Ibid.
¹⁹ "Donald Trump – On the Issues," White House Archives, 2025.
²⁰ "California's billionaires may have 2 choices in 2026: Leave the state or pay $50 million or more," Deseret News, December 23, 2025.
