billionaire

Reporting from Washington — Nigerian billionaire Gilbert Chagoury, one of Africa’s richest men, has built a reputation as a giant of global philanthropy.

His name is on a gallery at the Louvre and a medical school in Lebanon, and he has received awards for his generosity to the Catholic Church and St. Jude’s Children’s Hospital. He owns a seven-bedroom hilltop mansion in Beverly Hills, and he has a high-level network of friends from Washington to Lebanon to the Vatican, where he serves as an ambassador for the tiny island nation of St. Lucia. His website shows him shaking hands and laughing with Pope Francis.

“I never imagined what the future would hold for me,” Chagoury once said of his boyhood in Nigeria. “But I knew there was a vision for my life that was greater than I could imagine.… I consider it a duty to give back.”

Since the 1990s, Chagoury has also cultivated a friendship with the Clinton family — in part by writing large checks, including a contribution of at least $1 million to the Clinton Foundation.

By the time Hillary Clinton became secretary of State, the relationship was strong enough for Bill Clinton’s closest aide to push for Chagoury to get access to top diplomats, and the agency began exploring a deal, still under consideration, to build a consulate on Chagoury family land in Lagos, Nigeria.

But even as those talks were underway, bureaucrats in other arms of the State Department were examining accusations that Chagoury had unsavory affiliations, stemming from his activities and friendships in Lebanon. After a review, Chagoury was refused a visa to enter the U.S. last year.

Chagoury is a prominent example of the nexus between Hillary Clinton’s State Department and the family’s Clinton Foundation, which has come under renewed scrutiny during her presidential run. The organization, founded as a way for the Clintons to tap their vast network for charitable works, has tackled some of the steepest challenges in the developing world, including rebuilding Haiti and fighting AIDS in Africa. It has also come under fire for its willingness to accept money from foreign governments with interest in swaying U.S. policy during Clinton’s time as secretary of State, and the controversial histories of some donors.

Part of a dictator’s inner circle

Chagoury was born in 1946 in Lagos to Lebanese parents, and as a child attended school in Lebanon. He sold shoes and cars in Nigeria, according to a biography on his website, before marrying the daughter of a prominent Nigerian businessman.

During the rule of Gen. Sani Abacha, who seized power in Nigeria in 1993, Chagoury prospered, receiving development deals and oil franchises.

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In the 1990s, Chagoury portrayed himself as an Abacha insider as he tried to influence American policy to be more friendly to the regime. Soon after President Clinton named Donald E. McHenry a special envoy to Nigeria in 1995, Gilbert and brother Ronald Chagoury visited McHenry in his office at Georgetown University in Washington. The U.S. was pushing for the return of democratic rule in Nigeria; Abacha, meanwhile, was eager to have his country taken off a U.S. list of nations that enabled drug trafficking, McHenry said.

“Their effort was to try and influence anyone who they thought could influence the U.S. government,” McHenry said, adding that the approach was heavy-handed. “They tried every key on the piano.”

Abacha turned out to be “one of the most notorious kleptocrats in memory,” stealing billions in public funds, acting Assistant Atty. Gen. Mythili Raman later said.

After Abacha’s death in 1998, the Nigerian government hired lawyers to track down the money. The trail led to bank accounts all over the world — some under Gilbert Chagoury’s control. Chagoury, who denied knowing the funds were stolen, paid a fine of 1 million Swiss francs, then about $600,000, and gave back $65 million to Nigeria; a Swiss conviction was expunged, a spokesman for Chagoury said.

Ties to the Clintons

In the years afterward, Chagoury’s wealth grew. His family conglomerate now controls a host of businesses, including construction companies, flour mills, manufacturing plants and real estate.

He has used some of that money to build political connections. As a noncitizen, he is barred from giving to U.S. political campaigns, but in 1996, he gave $460,000 to a voter registration group steered by Bill Clinton’s allies and was rewarded with an invitation to a White House dinner. Over the years, Chagoury attended Clinton’s 60th birthday fundraiser and helped arrange a visit to St. Lucia, where the former president was paid $100,000 for a speech. Clinton’s aide, Doug Band, even invited Chagoury to his wedding.

Chagoury also contributed $1 million to $5 million to the Clinton Foundation, according to its list of donors. At a 2009 Clinton Global Initiative conference, where business and charity leaders pledge to complete projects, the Chagoury Group’s Eko Atlantic development — nine square kilometers of Lagos coastal land reclaimed by a seawall — was singled out for praise. During a 2013 dedication ceremony in Lagos, just after Hillary Clinton left her post as secretary of State, Bill Clinton lauded the $1-billion Eko Atlantic as an example to the world of how to fight climate change.

“I especially thank my friends Gilbert and Ron Chagoury for making it happen,” he said.

By last summer, U.S. diplomats had selected a 9.9-acre property at Eko Atlantic as the preferred site for a new Lagos consulate, State Department documents obtained by the Los Angeles Times show. Two months ago, James Entwistle, then the U.S. ambassador to Nigeria, wrote to Washington, asking permission to sign a 99-year lease.

No deal has been signed, State Department spokeswoman Elizabeth Trudeau said. She did not answer questions about whether the Clintons recommended Eko Atlantic. She said at a recent briefing that she was unaware of whether Hillary Clinton knew the site was under consideration; it was on a list of possibilities submitted by a real estate firm in 2012, Trudeau said in response to questions from The Times. A spokesman for Clinton’s campaign noted that the State Department has said the process has been managed by “career real estate professionals.”

Chagoury declined requests for an interview. A friend and spokesman, Mark Corallo, said Chagoury was a generous and “peace-loving” man unfairly scrutinized because of his association with the Clintons. He said Chagoury last saw Hillary Clinton at a 2006 dinner. The Clinton Foundation and a spokesman for Bill Clinton did not respond to requests for comment.

Chagoury also has given to Republicans: He and his brother, along with Eko Atlantic, are listed as sponsors for a 2014 art exhibit at the George W. Bush Presidential Center.

Suspicions emerge in the U.S.

In spite of his network of powerful friends, Chagoury has aroused the suspicions of U.S. security officials. In 2010, he was pulled off a private jet in Teterboro, N.J., and questioned for four hours because he was on the Department of Homeland Security’s no-fly list. He was subsequently removed from the list and categorized as a “selectee,” meaning he can fly but receives extra scrutiny, Homeland Security documents show. The agency later wrote to Chagoury to apologize “for any inconvenience or unpleasantness.”

That letter did not explain why Chagoury was on the no-fly list, but another Homeland Security document shows agents citing unspecified suspicions of links to terrorism, which can include financing extremist organizations; Chagoury later told reporters that agents asked him what bank he used in Nigeria.

Chagoury believes it was unfair for government officials to disclose the episode and to “suggest that he was a potential threat,” Corallo said. He said that Chagoury’s lawyers resolved the issue and that he never asked anyone else for help.

Chagoury told ABC News and the Center for Public Integrity at the time that he was miffed because his travel problems made him miss seeing the Lakers in the playoffs. “I just love the Lakers,” he said.

His visa troubles stem at least in part from his involvement in the tangled politics of Lebanon. Chagoury has contributed to charitable projects there, advocated on behalf of the country’s Christians and formed political alliances, including with Michel Aoun, a Lebanese Christian politician who served as army commander and prime minister during the country’s civil war.

For a decade, Aoun’s party has been part of a political coalition with Hezbollah, the Shiite Muslim group backed by Iran that has seats in Lebanon’s parliament. Hezbollah is classified as a terrorist organization by the U.S., which holds the group responsible for the 1983 bombing of the U.S. embassy in Beirut and a Marine barracks blast that year that killed 241 American servicemen. Drug Enforcement Administration investigations have also found that Hezbollah is in league with Latin American cartels to launder hundreds of millions of dollars in drug profits.

Chagoury was “known to have funded” Aoun, a Lebanese government minister told then-Ambassador Jeffrey D. Feltman in 2007, according to a cable published by WikiLeaks that didn’t go in detail about Chagoury’s relationship with Aoun. The minister suggested that the U.S. “deliver to Chagoury a strong message about the possibility of financial sanctions and travel bans against those who undermine Lebanon’s legitimate institutions.”

Chagoury never got a scolding, though. Instead, Band, Bill Clinton’s aide, pushed for new access for Chagoury after Hillary Clinton took over at the State Department. In 2009, Band wrote his friends in the department. “We need Gilbert Chagoury to speak to the substance guy re Lebanon. As you know he’s key guy there and to us and is loved in Lebanon. Very imp.” Huma Abedin, a longtime aide and confidante to Clinton and now vice chairwoman of her presidential campaign, suggested Feltman.

When Band’s email was made public this month, Donald Trump pounced, calling the Chagoury episode “illegal” and a “pay-to-play” scheme.

But no meeting ever happened, according to both Feltman and Chagoury’s spokesman. Chagoury wanted only to pass along insights on Lebanese politics, Corallo said, adding that “nothing ever came of it” and that Chagoury never talked to anyone at the State Department. Band declined to comment for this story.

A Clinton campaign spokesman said Judicial Watch, the conservative organization that sued to make the emails public, “has been attacking the Clintons since the 1990s.”

“No matter how this group tries to mischaracterize these documents, the fact remains that Hillary Clinton never took action as secretary of State because of donations to the Clinton Foundation,” spokesman Josh Schwerin said.

This month, the foundation announced that it would stop accepting donations from foreigners and corporations should Clinton win the presidency.

Denied a visa

After Clinton left the State Department, Chagoury again found himself under suspicion by U.S. security officials. A 2013 FBI intelligence report, citing unverified raw information from a source, claimed Chagoury had sent funds to Aoun, who transferred money to Hezbollah. The source said Aoun was “facilitating fundraising for Hezbollah.” The U.S. put Chagoury in its database used to screen travelers for possible links to terrorism, interagency memos show.

The ties between Chagoury and Aoun ended years ago in a dispute over oil franchises, said Michel de Chadarev, an official with Aoun’s party. Chagoury now backs an Aoun rival for the presidency. De Chadarev said Aoun “categorically denied” any arrangement where he shared money with Hezbollah or passed funds from Chagoury: “No, no, no. Of course not. It is not in his principles to act as transporter to anyone.”

Last summer, when Chagoury planned a trip to Los Angeles, he applied at the U.S. embassy in Paris for a visitor’s visa and was refused, according to interviews and government documents. Based on the FBI report and other allegations from intelligence and law enforcement sources, the State Department denied the application. It cited terrorism-related grounds, a broad category that can apply to anyone believed to have assisted a terrorist group in any way, including providing money.

Chagoury has denied ties to Hezbollah. Two years ago, he helped pay for a conference in Washington on the persecution of Christians in the Middle East; some attendees supported Hezbollah, but the director of the group that organized the conference said that didn’t mean Chagoury or other conference organizers were among them. “Hezbollah is part of the political reality of the country,” Andrew Doran told the National Review.

Corallo did not answer questions about the visa denial, but said Chagoury “has been a friend and supporter of America all his life” and that “any allegation that Mr. Chagoury is involved in any way with providing material support to any terrorist organization, of any stripe, is false, outrageous and defamatory.” He said Chagoury has no business interests in Lebanon.

The visa decision process is opaque and provides little recourse for those who are denied entry. Typically, the person is told of the grounds for refusal, but not the details. The secretary of State can grant a waiver, but that is often difficult when the evidence used to block entry is terrorism-related.

For the last three decades, Corallo said, Chagoury spent at least a few months each year in Beverly Hills, where he owns an 18,000-square-foot estate, once the home of actor Danny Thomas, with commanding views of West Los Angeles and the ocean.

A year ago, after his visa application was denied, Chagoury’s mansion was put on the market, with an asking price of $135 million. It’s still for sale.

joseph.tanfani@latimes.com

Twitter: @jtanfani

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The battle over a new tax on California’s billionaires is set to heat up in the coming months as citizens spar over whether the state should squeeze its ultra-rich to better serve its ordinary residents.

The proposed billionaire tax that triggered the tempest is still far from being approved by voters or even making the ballot, but the idea has already sparked backlash from vocal tech moguls — some of whom have already shifted their bases outside the state.

Under the Billionaire Tax Act, Californians worth more than $1 billion would pay a one-time 5% tax on their total wealth. The Service Employees International Union-United Healthcare Workers West, the union behind the act, said the measure would raise much-needed money for healthcare, education and food assistance programs.

Other unions have piled on billionaires, targeting the rich in Los Angeles.

A group of Los Angeles labor unions said Wednesday that it is proposing a ballot measure to raise taxes on companies whose chief executive officers earn 50 times more than their median-paid employees.

Here is how this fight could continue to play out in the Golden State:

Who would be affected?

The California billionaire tax would apply to about 200 California billionaires who reside in the state as of Jan. 1. Roughly 90% of funds would go to healthcare and the rest to public K-14 education and state food assistance.

The tax, due in 2027, would exclude real estate, pensions and retirement accounts, according to an analysis from the Legislative Analyst’s Office, a nonpartisan government agency. Billionaires could spread out the tax payment over five years, but would have to pay more.

Which billionaires are already distancing themselves from California?

Google co-founders Larry Page and Sergey Brin

Google is still headquartered in California, but December filings to the California Secretary of State show other companies tied to Page and Brin recently converted out of the state.

One filing, for example, shows that one of the companies they managed, now named T-Rex Holdings, moved from Palo Alto to Reno last month.

Business Insider and the New York Times earlier reported on these filings. Google didn’t respond to a request for comment.

Palantir co-founder Peter Thiel

Thiel Capital, based in Los Angeles, announced in December it opened an office in Miami. The firm didn’t respond to a request for comment. Thiel recently contributed $3 million to the political action committee of the California Business Roundtable, which is opposing the ballot measure, records provided to the Secretary of State’s Office show.

Oracle co-founder and Chief Technology Officer Larry Ellison

Years before the wealth tax proposal, Ellison began pulling back from California, but he’s continued to distance himself farther from the state since the proposal emerged.

Last year, Ellison sold his San Francisco mansion for $45 million. The home on 2850 Broadway was sold off-market in mid-December, according to Redfin.

Oracle declined to comment.

DoorDash co-founder and Chief Technology Officer Andy Fang

Fang, who was born and raised in California, said on X that he loves the state but is thinking about moving.

“Stupid wealth tax proposals like this make it irresponsible for me not to plan leaving the state,” he said.

DoorDash didn’t respond to a request for comment.

What would it still take to become law?

To qualify for the ballot, proponents of the proposal, led by the healthcare union, must gather nearly 875,000 registered voter signatures and submit them to county elections officials by June 24.

If it makes it on the November ballot, the proposal would be the focus of intense scrutiny and debate as both sides have already lined up big war chests to bombard voters with their positions. A majority of voters would need to approve the ballot measure.

Lawyers for billionaires have also signaled the battle won’t be over even if the ballot measure passes.

“Our clients are prepared to mount a vigorous constitutional challenge if this measure advances,” wrote Alex Spiro, an attorney who has represented billionaires such as Elon Musk in a December letter to California Gov. Gavin Newsom.

What are the initiative’s chances?

It’s unclear if the ballot measure has a good chance of passing in November. Newsom opposes the tax, and his support has proved important for ballot measures.

In 2022, he opposed a ballot measure that would have subsidized the electric vehicle market by raising taxes on Californians who earn more than $2 million annually. The measure failed. The following year, he opposed legislation to tax assets exceeding $50 million. The bill was shelved before the Legislature could vote on it. A bill that would impose an annual tax on California residents whose net worth surpassed $30 million also failed in 2020.

However, Sen. Bernie Sanders (I-Vt.) and Rep. Ro Khanna (D-Fremont) have backed the wealth tax proposal, and Californians have passed temporary tax measures before. In 2012, they approved Proposition 30 to increase sales tax and personal income tax for residents with an annual income of more than $250,000.

Could it solve California’s problems?

The Legislative Analyst’s Office said in a December letter that the state would probably collect tens of billions of dollars from the wealth tax, but it could also lose other tax revenue.

“The exact amount the state would collect is very hard to predict for many reasons. For example, it is hard to know what actions billionaires would take to reduce the amount of tax they pay. Also, much of the wealth is based on stock prices, which are always changing,” the letter said.

California economist Kevin Klowden said the tax could create future budget problems for the state. “The catch is that this is a one-off fix for what is a systemic problem,” he said.

Supporters of the proposal said the measure would raise about $100 billion and pushed back against the idea that billionaires would flee.

“We see a lot of cheap talk from billionaires,” said UC Berkeley law professor Brian Galle, who helped write the proposal. “Some people do actually leave and change their behavior, but the vast bulk of wealthy people don’t, because it doesn’t make sense.”

Still, the pushback has been escalating.

Palo Alto-based venture capitalist Chamath Palihapitiya estimates that the lost revenues from the billionaires who have already left the state would lead to more losses in tax revenues than gained by the new tax.

“By starting this ill-conceived attempt at an asset tax, the California budget deficit will explode,” he posted on X. “And we still don’t know if the tax will even make the ballot.”

The union backing the initiative says “the billionaire exodus narrative” is “wildly overstated.”

“Right now, it appears the overwhelming majority of billionaires have chosen to stay in California past the Jan. 1 deadline,” said Suzanne Jimenez, chief of staff at SEIU-United Healthcare Workers West. “Only a very small percentage left before the deadline, despite weeks of Chicken Little talking points claiming a modest tax would trigger a mass departure.”

Times staff writer Seema Mehta contributed to this report.

California has billionaires on the brain.

Last week union activists, hoisting giant cutouts of money bags and a cigar-smoking boss, announced a proposal to raise Los Angeles city taxes on companies with “overpaid” chief executives.

They rallied in front of a symbol of the uber rich: the futuristic, steel-covered Tesla Diner owned by Elon Musk, the world’s richest man.

Meanwhile, a “billionaire tax” proposal prompted some of the wealthiest Californians to consider fleeing the state, amid arguments that they would take their tax revenue — and the companies they run — with them, hurting the ordinary residents the proposal is designed to help.

The focus on taxing the richest of the rich comes amid a growing affordability crisis in California, home to the nation’s most expensive housing market and highest income tax.

More than 200 billionaires reside in California, more than any other state, according to a group of law and economics professors at UC Berkeley, UC Davis and the University of Missouri who helped draft the statewide billionaire tax proposal, which proponents are hoping to place on the November ballot.

And they are getting richer. The collective wealth of the state’s billionaires surged from $300 billion in 2011 to $2.2 trillion in October 2025, according to a December report by those professors. In Los Angeles, where the median sale price of $1 million puts home ownership out of reach for many residents, prominent billionaires include David Geffen, Steven Spielberg and Magic Johnson.

One conspicuous billionaire is especially unpopular in California: President Trump, who, despite campaigning on bringing down the cost of living, recently called the word “affordability” a “con job” as he redecorated the White House in gold.

“In a deep blue state like California that has voted against Donald Trump by such large numbers in the last three elections, voters are even more predisposed to be suspicious of billionaires, because he’s now the person with whom they associate the status,” said Dan Schnur, a politics professor at USC, UC Berkeley and Pepperdine.

The state and local tax-the-billionaires proposals, he said, are “about retribution,” much like last year’s Proposition 50, which temporarily redraws the state’s congressional districts to favor Democrats as a counterweight to Trump’s efforts to increase Republican seats in Texas.

To get the statewide billionaire tax proposal on the November ballot, supporters need to collect nearly 875,000 signatures by June 24.

The measure would impose a one-time tax of up to 5% on taxpayers and trusts with assets, such as businesses, art and intellectual property, valued at more than $1 billion. It would apply to billionaires who were residents of the state on Jan. 1, with the option of spreading the tax payment over five years.

Service Employees International Union-United Healthcare Workers West, its main backer, said it will raise $100 billion. Most of those funds would be used for healthcare programs, with the remaining 10% going to food assistance and education programs, the union said.

Suzanne Jimenez, the union’s chief of staff, said Friday that “catastrophic” federal funding cuts stemming from Trump’s One Big Beautiful Bill Act will force hospitals to close, eliminate healthcare jobs and cause insurance premiums to spike, leaving senior citizens and veterans with limited access to services.

The California Budget & Policy Center estimates that as many as 3.4 million Californians could lose Medi-Cal coverage and rural hospitals could close unless a new funding source is found.

Jimenez called the proposal “a modest tax” that “affects few people.”

But Gov. Gavin Newsom vowed to stop the billionaire tax, arguing that California can’t isolate itself from the other 49 states.

“We’re in a competitive environment. People have this simple luxury, particularly people of that status, they already have two or three homes outside the state,” Newsom said at the New York Times’ DealBook Summit last month. “It’s a simple issue. You’ve got to be pragmatic about it.”

The billionaire tax would temporarily increase revenues by tens of billions spread over several years, but if billionaires move away, the state could lose “hundreds of millions of dollars or more per year,” according to the nonpartisan California Legislative Analyst’s Office.

Some of California’s wealthiest say they are indeed heading for the exits.

Andy Fang, the billionaire co-founder of DoorDash, wrote on social media: “I love California. Born and raised there. But stupid wealth tax proposals like this make it irresponsible for me not to plan leaving the state.”

Peter Thiel, the billionaire co-founder of PayPal and Palantir, announced in December that his investment firm opened a new Miami office. He donated $3 million that month to a political action committee connected to the California Business Roundtable, which is fighting the measure.

State records show that Google co-founders Larry Page and Sergey Brin have been cutting ties to California and moving business interests out of state.

Rick Caruso, the billionaire real estate developer who self-funded his losing 2022 L.A. mayoral campaign to the tune of more than $100 million, said in a statement that “the proposed 5% asset tax is a very bad policy. It will deliver nothing it promises and instead hurt California with lost jobs and hundreds of millions a year in lost revenue from existing income taxes.”

Ending months of speculation, Caruso announced Friday he will not challenge Mayor Karen Bass again, nor will he run for governor in a race that includes billionaire hedge fund founder Tom Steyer.

In Los Angeles, supporters of the “Overpaid CEO Tax” announced outside the Tesla Diner that they must collect 140,000 signatures in the next 120 days to get the measure on the November ballot. The measure would raise taxes on companies whose CEOs make at least 50 times more than their median-paid employee. It would apply only to companies with 1,000 or more employees.

The Fair Games Coalition, a collection of labor groups including the Los Angeles teachers union, is sponsoring the measure, which would allocate 70% of the revenue to housing for working families, 20% to street and sidewalk repairs and 5% to after-school programs and access to fresh food.

Business groups have denounced it, saying it would drive companies out of the city.

“Luxury for a few, while those who cook, who clean, who build, who teach, who write — the people who make the city prosperous — are stretched to the breaking point,” Kurt Petersen, co-president of the airport and hotel workers union Unite Here Local 11, said at Musk’s diner, describing it as an avatar for an unjust L.A. economy.

A similar effort to increase taxes on companies with disproportionately paid CEOs is underway in San Francisco, where voters already approved a levy on such businesses in 2020.

On Friday, Doug Herman, a spokesperson for Bass’ reelection campaign, said she has “not taken a position” on the state or city wealth tax proposals. But at her campaign launch last month, Bass framed the mayoral race as “a choice between working people and the billionaire class who treat public office as their next vanity project.”

Jeremy Padawer, a toy industry executive and animated TV producer who lost his home in the Palisades fire, said the mayor’s framing of the race as a battle against billionaires feels contrived, especially given the intense criticism of her handling of the fire.

Power is as relevant as money, and Bass is “the most powerful person in the room,” said Padawer, who organized the “They Let Us Burn” rally on the one-year anniversary of the fire.

“I know a lot of billionaires,” Padawer said. “And I think that billionaires have a propensity to do a lot of good, but they also have the propensity to do a lot of bad.”

Times staff writer Queenie Wong contributed to this report.

Billionaire developer Rick Caruso will not run for Los Angeles mayor or California governor, after months of speculation that he would seek one of the two posts.

Caruso, who had been teasing a possible run for months, made his decision Friday, saying it came after “many heartfelt conversations” with his family.

“Though my name will not be on a ballot, my work continues,” Caruso said on X. “Public service does not require a title. It is, and always will be, my calling.”

Caruso’s plans were the talk of political circles for many months. Recently, he seemed to confirm that he would seek one of the two positions.

When asked by a reporter on Jan. 7 if it was possible he would not run for any position, Caruso responded: “That option is pretty much off the table now.”

Caruso said he will focus on his nonprofit, Steadfast LA, which brings industry leaders together to help with the Palisades fire recovery.

The 66-year-old developer behind popular L.A. malls like the Grove and the Americana at Brand spent $100 million of his own fortune against Karen Bass in 2022, outspending her 11 to 1 in his failed bid. But Bass beat him by nearly 10 percentage points.

Caruso served as president of the L.A. Police Commission in the 2000s and helped the city hire William Bratton as police chief. He was appointed to the Department of Water and Power board in 1984, at age 26 — the youngest commissioner in city history at the time.

Caruso has steadily critiqued the mayor online and in public appearances since 2022, seemingly honing and refining his argument for voters to reject the incumbent, whom he has described as incompetent.

“Her record is so bad,” Caruso said at a town hall he hosted at the Americana on Nov. 3.

Caruso’s decision not to run for mayor solidifies the 2026 field against Bass. Former Los Angeles Unified School District Superintendent Austin Beutner is running a moderate campaign, with arguments about Bass’ response to the Palisades fire and quality of life concerns that are similar to Caruso’s. The developer’s entry could have thrown a wrench into Beutner’s campaign.

Bass also faces a challenge from her left with Rae Huang, a community organizer and reverend, announcing a run for mayor in November.

Most recently, the entry of former reality star and Palisades fire victim Spencer Pratt has added new intrigue to the race.

Bass’ campaign declined to comment on Caruso’s decision.

As for governor, some voters in deep blue pockets of the state may have rejected Caruso, a former Republican who registered as a Democrat in 2022 and has faced questions over his past party registration.

Still, the developer, who has made public safety and quality of life issues his main talking points, might have attracted California voters unhappy with the current crop of gubernatorial candidates.

No single candidate has dominated the field, while some potential contenders, including Sen. Alex Padilla and Atty. Gen. Rob Bonta, have announced they’re not running.

As he weighed a bid for governor in the last year, Caruso traveled multiple times to Sacramento and around the state to meet with labor leaders, community groups and politicians.

“My guess is he did polling and he did not see a path forward,” said Sara Sadhwani, a professor of politics at Pomona College.

“Had he jumped into either race and lost, it would have made the prospects of elected office even further away,” she said.

SAN FRANCISCO — With California facing deep budget uncertainty and widening economic divides, Gov. Gavin Newsom on Friday vowed to protect residents on both ends of the income spectrum — from wealthy business leaders he fears could leave the state to unhoused Californians relying on state-funded services.

That balancing act was on display as Newsom sharpened his criticism of a proposed ballot measure to tax billionaires, a measure opponents say may push tech companies and other businesses out of the state and wound California’s economy.

“It’s already had an outsized impact on the state,” said Newsom, speaking to reporters in San Francisco’s Mission District.

Newsom is trying to head off a union’s plan for a November ballot measure that would put a one-time tax on billionaires. If approved by voters, it would raise $100 billion by imposing a one-time wealth tax of 5% on fortunes.

Service Employees International Union-United Healthcare Workers West, the union behind the proposal, wants to raise money to help millions of Californians affected by widespread healthcare cuts by the Trump administration.

California political leaders, facing a tough budget year, warn that the state does not have the financial capacity to backfill those cuts.

Newsom, who is working behind the scenes with SEIU-UHW in an effort to stop the ballot measure, on Friday appeared doubtful that a deal could be struck with proponents of the measure.

“I don’t know what there is to compromise,” said Newsom, calling the measure “badly drafted” and arguing the money raised wouldn’t be spread among other groups.

“It does not support our public educators. Does not support our teachers and counselors, our librarians. It doesn’t support our first responders and firefighters. Doesn’t support the general fund and parks.”

Two top Newsom advisors, Dan Newman and Brian Brokaw, are raising money and have formed a committee to oppose the measure.

The billionaire tax measure is dividing political leaders in California and the rest of the country, with both Rep. Ro Khanna (D-Fremont) and Sen. Bernie Sanders (I-Vermont) supporting the tax.

“It’s a matter of values,” Khanna said on X. “We believe billionaires can pay a modest wealth tax so working-class Californians have the Medicaid.”

Already, some prominent business leaders are taking steps that appear to be part of a strategy to avoid a potential levy.

On Dec. 31, PayPal co-founder Peter Thiel announced that his firm had opened a new office in Miami, the same day venture capitalist David Sacks said he was opening an office in Austin.

Suzanne Jimenez, chief of staff for SEIU-United Healthcare Workers West, called it a myth that billionaires are leaving the state and criticized Newsom.

“Right now, his priority seems to be protecting roughly 200 ultra-wealthy individuals,” she said. “Healthcare workers are focused on protecting emergency room access and lifesaving care for all 39 million Californians.”

The proposed tax has reverberated throughout the Silicon Valley and Bay Area, home to some of the world’s most lucrative tech companies and financially successful venture capitalists.

Newsom was in San Francisco on Friday, where he served two terms as mayor, to address a separate, more pressing concern for Californians on the opposite end of the economic spectrum — those living in poverty and on the city streets.

Newsom, who is weighing a 2028 presidential run, spoke at Friendship House, a substance-use treatment provider, where the governor said California is turning around the state’s homelessness crisis.

He pointed to a recent 9% statewide drop in unsheltered homelessness as evidence that years of state investment and policy changes are beginning to show results.

That was the first such drop in more than 15 years on an issue that is a political vulnerability for the two-term governor. California still accounts for roughly a quarter of the nation’s homeless population, according to the Public Policy Institute of California.

Newsom said Friday that the decline reflects years of expanded state investment in shelter, housing and behavioral healthcare, combined with stricter expectations for local governments receiving state funds. He said the state’s efforts contrast with what is happening elsewhere, pointing to homelessness continuing to rise nationally.

The governor’s budget proposal, which was released Jan. 9, includes $500 million for California’s Homeless Housing, Assistance and Prevention program, which provides grants to cities, counties and local continuums of care to prevent and reduce homelessness.

That money is paired with investments from Proposition 1, a 2024 ballot measure backed by Newsom and approved by voters. The measure authorized billions in state bonds to expand mental health treatment capacity and housing for people with serious behavioral health needs.

Following Newsom’s budget proposal, legislators, housing advocates and local officials said the funding falls short of the scale of the problem.

That concern is unfolding against a constrained budget backdrop, with the governor’s finance director warning that even as AI-related tax revenues climb, rising costs and federal cuts are expected to leave the state with a projected $3 billion deficit next year.

The nonpartisan Legislative Analyst’s Office said Newsom’s plan leaves California financially exposed, noting that the administration’s higher revenue estimates exclude the risk of a stock market correction that could significantly worsen the state’s budget outlook.

The analyst’s office said those risks are compounded by projected multiyear deficits of $20 billion to $35 billion annually, underscoring what it called a growing structural imbalance.

Newsom on Friday called the LAO’s projections about the budget too pessimistic, but said the office is “absolutely right about structural problems in the state.”

Newsom’s budget does not include significant funding to offset federal cuts to Medicaid and other safety-net programs under President Trump and a Republican-led Congress, reductions that local officials warn could have far-reaching consequences for local governments and low-income residents.

Addressing those broad concerns, the governor defended his budget and suggested the spending plan will change by May, when the state’s financial outlook is more clear.

Times staff writer Seema Mehta and Caroline Petrow-Cohen contributed to this report.

Jan. 15 (UPI) — U.S. philanthropist Gilbert Butler has emerged as a major private donor shaping conservation policy in Latin America by financing the purchase and then donating six islands in Uruguay and Argentina to create the first binational park on the Uruguay River.

Butler donated the islands of Chala, Inga and Pinguino to the Uruguayan state. The islands lie on the river in Rio Negro department, an administrative division similar to a county.

Together, the three islands cover 1,270 acres and were incorporated into Uruguay’s National System of Protected Areas, known by its Spanish acronym SNAP, according to statements from the Presidency of Uruguay and the Ministry of Environment.

Uruguayan authorities described the donation as unprecedented, marking the first time the country has added land to SNAP through a direct donation of property purchased by a private person for conservation purposes.

“Nothing like this has been seen for decades,” President Yamandu Orsi said Thursday during the ceremony accepting the islands.

According to Uruguayan officials, at least two of the islands include basic public-use infrastructure, such as docks, shelters and restrooms designed for low-impact ecotourism and environmental education.

The project aims to promote restorative economies and strengthen local communities under a model based on conservation and ecological connectivity.

The Uruguay initiative is linked to a project already underway in Argentina. On the Argentine side of the river, Butler previously acquired the islands of Dolores, San Genaro and Campichuelo in Entre Rios province. Together they span about 6,425 acres and are slated to be donated to creates a provincial nature park.

Provincial authorities plan to add about 3,459 acres of public land to that core area, bringing the total protected surface to about 9,884 acres. All six islands are part of the same cross-border conservation scheme.

In a speech, Butler said his goal is to create a binational park, contending that using the land solely for eucalyptus and soybean plantations “is an ecological disaster.”

The six islands make up the project known as Green Islands and Channels of the Uruguay River, which seeks to establish a continuous transboundary ecological corridor along one of the Southern Cone’s most important freshwater basins.

The initiative focuses on protecting wetlands, riverine biodiversity and ecological connectivity, while supporting sustainable tourism.

The donation has reopened public debate in Uruguay over the ownership of river islands.

Under current regulations and legal analyses reported locally, river islands are registered parcels that may be publicly or privately owned regardless of the owner’s nationality and may be incorporated into the protected areas system even if they were previously private.

Records and local media reports show the donated islands had been privately owned since the 1990s after being transferred as part of the settlement of a commercial debt.

Previous attempts at productive use failed because of recurring floods linked to the river’s hydrological cycle.

Local authorities in Rio Negro and Entre Rios said the binational project presents coordination challenges, but agreed it could position the Uruguay River region as a regional example for shared environmental conservation.

Just days after the fatal shooting of a Minnesota woman by a federal immigration agent, the Trump administration’s immigration policy was a top focus of California gubernatorial candidates at two forums Saturday in Southern California.

The death of Renee Nicole Good, a 37-year-old mother of three, inflamed the nation’s deep political divide and led to widespread protests in Los Angeles and across the country about President Trump’s combative immigration policies.

Former Assembly majority leader Ian Calderon, speaking at a labor forum featuring Democratic candidates in Los Angeles, said that federal agents aren’t above the law.

“You come into our state and you break one of our … laws, you’re going to be criminally charged. That’s it,” he said.

Federal officials said the deadly shooting was an act of self defense.

Rep. Eric Swalwell (D-Dublin) noted that the president of the labor union that organized the candidate forum, David Huerta, was injured and arrested during the Trump administration’s raids on undocumented people in Los Angeles in June.

“Ms. Good should be alive today. David, that could have been you, the way they’re conducting themselves,” he said to Huerta, who was moderating the event. “You’re now lucky if all they did was drag you by the hair or throw you in an unmarked van, or deport a 6-year-old U.S. citizen battling stage four cancer.”

Roughly 40 miles south at a separate candidate forum featuring the top two Republicans in the race, GOP candidate and Riverside County Sheriff Chad Bianco said politicians who support so-called “sanctuary state” policies should be voted out of office.

“I wish it was the 1960s, 70s, and 80s — we’d take them behind the shed and beat … them,” he said.

“We’re in a church!” an audience member was heard yelling during a livestream of the event.

California Democratic leaders in 2017 passed a landmark “sanctuary state” law that limits cooperation between local and federal immigration officers, a policy that was a reaction to the first Trump administration’s efforts to ramp up deportations.

After the campaign to replace termed-out Gov. Gavin Newsom was largely obscured last year by natural disasters, immigration raids and the special election to redraw California’s congressional districts, the 2026 governor’s race is now in the spotlight.

Eight Democratic candidates appeared at a forum sponsored by SEIU United Service Workers West, which represents more than 45,000 janitors, security officers, airport service employees and other workers in California.

Many of the union’s members are immigrants, and a number of the candidates referred to their familial roots as they addressed the audience of about 250 people — with an additional 8,000 watching online.

“As the son of immigrants, thank you for everything you did for your children, your grandchildren, to give them that chance,” former U.S. Health and Human Services Secretary Xavier Becerra told two airport workers who asked the candidates questions about cuts to state services for immigrants.

“I will make sure you have the right to access the doctor you and your family need. I will make sure you have a right to have a home that will keep you safe and off the streets. I will make sure that I treat you the way I would treat my parents, because you worked hard the way they did.”

The Democrats broadly agreed on most of the pressing issues facing California, so they tried to differentiate themselves based on their records and their priorities.

Candidates for California’s next governor including Tony Thurmond, speaking at left, participate in the 2026 Gubernatorial Candidate Forum in Los Angeles on Saturday.

(Christina House/Los Angeles Times)

“I firmly believe that your campaign says something about who you will be when you lead. The fact that I don’t take corporate contributions is a point of pride for me, but it’s also my chance to tell you something about who I am and who I will fight for,” said former Rep. Katie Porter.

“Look, we’ve had celebrity governors. We’ve had governors who are kids of other governors, and we’ve had governors who look hot with slicked back hair and barn jackets. You know what? We haven’t had a governor in a skirt. I think it’s just about … time.”

Former Los Angeles Mayor Antonio Villaraigosa, seated next to Porter, deadpanned, “If you vote for me, I’ll wear a skirt, I promise.”

Villaraigosa frequently spoke about his roots in the labor movement, including a farmworker boycott when he was 15 years old.

“I’ve been fighting for immigrants my entire life. I have fought for you the entire time I’ve been in public life,” he said. “I know [you] are doing the work, working in our buildings, working at the airport, working at the stadiums. I’ve talked to you. I’ve worked with you. I’ve fought for you my entire life. I’m not a Johnny-come-lately to this unit.”

The candidates were not asked about a proposed ballot measure to tax the assets of billionaires that one of SEIU-USWW’s sister unions is trying to put on the November ballot. The controversial proposal has divided Democrats and prompted some of the state’s wealthiest residents to move out of the state, or at least threaten to do so.

But several of the candidates talked about closing tax loopholes and making sure the wealthy and businesses pay their fair share of taxes.

“We’re going to hold corporations and billionaires accountable. We’re going to be sure that we are returning power to the workers who know how to grow this economy,” said former state Controller Betty Yee.

State Supt. of Public Instruction Tony Thurmond highlighted his proposal to tax billionaires to fund affordable housing, healthcare and education.

“And then I’m going to give you, everyone in this room and California working people, a tax credit so you have more money in your pocket, a couple hundred dollars a month, every month, for the rising cost of gas and groceries,” he said.

Billionaire hedge fund founder Tom Steyer said closing corporate tax loopholes would result in $15 billion to $20 billion in new annual state revenue that he would spend on education and healthcare programs.

“When we look at where we’re going, it’s not about caring, because everyone on this stage cares. It’s not about values. It’s about results,” he said, pointing to his backing of successful ballot measures to close a corporate tax loophole, raise tobacco taxes, and stop oil-industry-backed efforts to roll back environmental law.

“I have beaten these special interests, every single time with the SEIU,” he said. “We’ve done it. We’ve been winning. We need to keep fighting together. We need to keep winning together.”

Republican gubernatorial candidates were not invited to the labor gathering. But two of the state’s top GOP contenders were among the five candidates who appeared Saturday afternoon at a “Patriots for Freedom” gubernatorial forum at Calvary Chapel WestGrove in Orange County. Immigration, federal enforcement and homelessness were also among the hot topics there.

Days after Bianco met with unhoused people on Skid Row in downtown Los Angeles and Newsom touted a 9% decrease in the number of unsheltered homeless people during his final state of the state address, Bianco said that he would make it a “crime” for anyone to utter the word “homeless,” arguing that those on the street are suffering from drug- and alcohol-induced psychosis, not a lack of shelter.

Former Fox News commentator Steve Hilton criticized the “attacks on our law enforcement offices, on our ICE agents who are doing their job protecting our country.”

“We are sick of it,” he said at the Garden Grove church while he also questioned the state’s decision to spend billions of dollars for healthcare for low-income undocumented individuals. State Democrats voted last year to halt the enrollment of additional undocumented adults in the state’s Medi-Cal program starting this year.

California helped make them among the richest people in the world. Now they’re fleeing because California wants a little something back.

The proposed California Billionaire Tax Act has plutocrats saying they are considering deserting the Golden State for fear they’ll have to pay a one-time, 5% tax, on top of the other taxes they barely pay in comparison to the rest of us. Think of it as the Dust Bowl migration in reverse, with The Monied headed East to grow their fortunes.

The measure would apply to billionaires residing in California as of Jan. 1, 2026, meaning that 2025 was a big moving year month among the 200 wealthiest California households subject to the tax.

The recently departed reportedly include In-n-Out Burger owner and heiress Lynsi Snyder, PayPal co-founder and conservative donor Peter Thiel, Venture Capitalist David Sacks, co-founder of Craft Ventures, and Google co-founder Larry Page, who recently purchased $173 million worth of waterfront property in Miami’s Coconut Grove. Thank goodness he landed on his feet in these tough times.

The principal sponsor behind the Billionaire Tax Act is the Service Employees International Union-United Healthcare Workers West (SEIU-UHW), which contends that the tax could raise a $100 billion to offset severe federal cutbacks to California’s public education, food assistance and Medicaid programs.

The initiative is designed to offset some of the tax breaks that billionaires received from the One Big Beautiful Bill Act recently passed by the Republican-dominated Congress and signed by President Trump.

According to my colleague Michael Hiltzik, the bill “will funnel as much as $1 trillion in tax benefits to the wealthy over the next decade, while blowing a hole in state and local budgets for healthcare and other needs.”

The drafters of the Billionaire Tax Act still have to gather around 875,000 signatures from registered voters by June 24 for the measure to qualify on November’s ballot. But given the public ire toward the growing wealth of the 1%, and the affordability crisis engulfing much of the rest of the nation, it has a fair chance of making it onto the ballot.

If the tax should be voted into law, what would it mean for those poor tycoons who failed to pack up the Lamborghinis in time? For Thiel, whose net worth is around $27.5 billion, it would be around $1.2 billion, should he choose to stay, and he’d have up to five years to pay it.

Yes, it’s a lot … if you’re not a billionaire. It’s doubtful any of the potentially affected affluents would feel the pinch, but it could make a world of difference for kids depending on free school lunches, or folks who need medical care but can’t afford it because they’ve been squeezed by a system that places much of the tax burden on them.

According to the California Budget & Policy Center, the bottom fifth of California’s non-elderly families, with an average annual income of $13,900, spend an estimated 10.5% of their incomes on state and local taxes. In comparison, the wealthiest 1% of families, with an average annual income of $2.0 million, spend an estimated 8.7% of their incomes on state and local taxes.

“It’s a matter of values,” Rep. Ro Khanna (D-Fremont) posted on X. “We believe billionaires can pay a modest wealth tax so working-class Californians have Medicaid.”

Many have argued losing all that wealth to other states will hurt California in the long run.

Even Gov. Gavin Newsom has argued against the measure, citing that the wealthy can relocate anywhere else to evade the tax. During the New York Times DealBook Summit last month, Newsom said, “You can’t isolate yourself from the 49 others. We’re in a competitive environment.”

He has a point, as do others who contend that the proposed tax may hurt California rather then help.

Sacks signaled he was leaving California by posting an image of the Texas flag on Dec. 31 on X and writing: “God bless Texas.” He followed with a post that read, “As a response to socialism, Miami will replace NYC as the finance capital and Austin will replace SF as the tech capital.”

Arguments aside, it’s disturbing to think that some of the richest people in the nation would rather pick up and move than put a small fraction of their vast California-made — or in the case of the burger chain, inherited — fortunes toward helping others who need a financial boost.

The fiery debate about a proposed ballot measure to tax California’s billionaires has sparked some soul-searching across the state.

While the idea of a one-time tax on more than 200 people has a long way to go before getting onto the ballot and would need to be passed by voters in November, the tempest around it captures the zeitgeist of angst and anger at the core of California. Silicon Valley is minting new millionaires while millions of the state’s residents face the loss of healthcare coverage and struggle with inflation.

Supporters of the proposed billionaire tax say it is one of the few ways the state can provide healthcare for its most vulnerable. Opponents warn it would squash the innovation that has made the state rich and prompt an exodus of wealthy entrepreneurs from the state.

The controversial measure is already creating fractures among powerful Democrats who enjoy tremendous sway in California. Progressive icon Sen. Bernie Sanders (I-Vt.) quickly endorsed the billionaire tax, while Gov. Gavin Newsom denounced it .

The Golden State’s rich residents say they are tired of feeling targeted. Their success has not only created unimaginable wealth but also jobs and better lives for Californians, they say, yet they feel they are being punished.

“California politics forces together some of the richest areas of America with some of the poorest, often separated by just a freeway,” said Thad Kousser, a political science professor at UC San Diego. “The impulse to force those with extreme wealth to share their riches is only natural, but often runs into the reality of our anti-tax traditions as well as modern concerns about stifling entrepreneurship or driving job creation out of the state.”

The state budget in California is already largely dependent on income taxes paid by its highest earners. Because of that, revenues are prone to volatility, hinging on capital gains from investments, bonuses to executives and windfalls from new stock offerings, and are notoriously difficult for the state to predict.

The tax proposal would cost the state’s richest residents about $100 billion if a majority of voters support it on the November ballot.

Supporters say the revenue is needed to backfill the massive federal funding cuts to healthcare that President Trump signed this summer. The California Budget & Policy Center estimates that as many as 3.4 million Californians could lose Medi-Cal coverage, rural hospitals could shutter and other healthcare services would be slashed unless a new funding source is found.

On social media, some wealthy Californians who oppose the wealth tax faced off against Democratic politicians and labor unions.

An increasing number of companies and investors have decided it isn’t worth the hassle to be in the state and are taking their companies and their homes to other states with lower taxes and less regulation.

“I promise you this will be the final straw,” Jessie Powell, co-founder of the Bay Area-based crypto exchange platform Kraken, wrote on X. “Billionaires will take with them all of their spending, hobbies, philanthropy and jobs.”

Proponents of the proposed tax were granted permission to start gathering signatures Dec. 26 by California Secretary of State Shirley Weber.

The proposal would impose a one-time tax of up to 5% on taxpayers and trusts with assets, such as businesses, art and intellectual property, valued at more than $1 billion. There are some exclusions, including property.

They could pay the levy over five years. Ninety percent of the revenue would fund healthcare programs and the remaining 10% would be spent on food assistance and education programs.

To qualify for the November ballot, proponents of the proposal, led by the Service Employees International Union-United Healthcare Workers West, must gather the signatures of nearly 875,000 registered voters and submit them to county elections officials by June 24.

The union, which represents more than 120,000 healthcare workers, patients and healthcare consumers, has committed to spending $14 million on the measure so far and plans to start collecting signatures soon, said Suzanne Jimenez, the labor group’s chief of staff.

Without new funding, the state is facing “a collapse of our healthcare system here in California,” she said.

Rep. Ro Khanna (D-Fremont) spoke out in support of the tax.

“It’s a matter of values,” he said on X. “We believe billionaires can pay a modest wealth tax so working-class Californians have the Medicaid.”

The Trump administration did not respond to requests for comment.

The debate has become a lightning rod for national thought leaders looking to target California’s policies or the ultra-rich.

On Tuesday, Sanders endorsed the billionaire tax proposal and said he plans to call for a nationwide version.

“This is a model that should be emulated throughout the country, which is why I will soon be introducing a national wealth tax on billionaires,” Sanders said on X. “We can and should respect innovation, entrepreneurship and risk-taking, but we cannot respect the extraordinary level of greed, arrogance and irresponsibility that is currently being displayed by much of the billionaire class.”

But there isn’t unanimous support for the proposal among Democrats.

Notably, Newsom has consistently opposed state-based wealth taxes. He reiterated his opposition when asked about the proposed billionaires’ tax in early December.

“You can’t isolate yourself from the 49 others,” Newsom said at the New York Times DealBook Summit. “We’re in a competitive environment. People have this simple luxury, particularly people of that status, they already have two or three homes outside the state. It’s a simple issue. You’ve got to be pragmatic about it.”

Newsom has opposed state-based wealth taxes throughout his tenure.

In 2022, he opposed a ballot measure that would have subsidized the electric vehicle market by raising taxes on Californians who earn more than $2 million annually. The measure failed at the ballot box, with strategists on both sides of the issue saying Newsom’s vocal opposition to the effort was a critical factor.

The following year, he opposed legislation by a fellow Democrat to tax assets exceeding $50 million at 1% annually and taxpayers with a net worth greater than $1 billion at 1.5% annually. The bill was shelved before the legislature could vote on it.

The latest effort is also being opposed by a political action committee called “Stop the Squeeze,” which was seeded by a $100,000 donation from venture capitalist and longtime Newsom ally Ron Conway. Conservative taxpayer rights groups such as the Howard Jarvis Taxpayers Assn. and state Republicans are expected to campaign against the proposal.

The chances of the ballot measure passing in November are uncertain, given the potential for enormous spending on the campaign — unlike statewide and other candidate races, there is no limit on the amount of money donors can contribute to support or oppose a ballot measure.

“The backers of this proposed initiative to tax California billionaires would have their work cut out for them,” said Kousser at UC San Diego. “Despite the state’s national reputation as ‘Scandinavia by the Sea,’ there remains a strong anti-tax impulse among voters who often reject tax increases and are loath to kill the state’s golden goose of tech entrepreneurship.”

Additionally, as Newsom eyes a presidential bid in 2028, political experts question how the governor will position himself — opposing raising taxes but also not wanting to be viewed as responsible for large-scale healthcare cuts that would harm the most vulnerable Californians.

“It wouldn’t be surprising if they qualify the initiative. There’s enough money and enough pent-up anger on the left to get this on the ballot,” said Dan Schnur, a political communications professor who teaches at USC, Pepperdine and UC Berkeley.

“What happens once it qualifies is anybody’s guess,” he said.

Lorena Gonzalez, president of the California Federation of Labor Unions, called Newsom’s position “an Achilles heel” that could irk primary voters in places like the Midwest who are focused on economic inequality, inflation, affordability and the growing wealth gap.

“I think it’s going to be really hard for him to take a position that we shouldn’t tax the billionaires,” said Gonzalez, whose labor umbrella group will consider whether to endorse the proposed tax next year.

California billionaires who are residents of the state as of Jan. 1 would be impacted by the ballot measure if it passes . Prominent business leaders announced moves that appeared to be a strategy to avoid the levy at the end of 2025. On Dec. 31, PayPal co-founder Peter Thiel announced that his firm had opened a new office in Miami, the same day venture capitalist David Sacks said he was opening an office in Austin.

Wealth taxes are not unprecedented in the U.S. and versions exist in Switzerland and Spain, said Brian Galle, a taxation expert and law professor at UC Berkeley.

In California, the tax offers an efficient and practical way to pay for healthcare services without disrupting the economy, he said.

“A 1% annual tax on billionaires for five years would have essentially no meaningful impact on their economic behavior,” Galle said. “We’re funding a way of avoiding a real economic disaster with something that has very tiny impact.”

Palo Alto-based venture capitalist Chamath Palihapitiya disagrees. Billionaires whose wealth is often locked in company stakes and not liquid could go bankrupt, Palihapitiya wrote on X.

The tax, he posted, “will kill entrepreneurship in California.”