A Cynical Ploy to Block California’s Wealth Tax

Some voters who support the proposal might be duped into nullifying it.

The most important decision facing California voters this year is not which candidates to support for higher office, but whether to approve a wealth tax on the state’s approximately 250 billionaires. The ballot initiative that would impose the tax has plenty of enemies, among not only the superrich but also the many Californians, including Governor Gavin Newsom, who worry about losing the superrich to other states. But thanks to a deviously cynical electoral maneuver by the measure’s opponents, the people who ultimately doom it might include some of those who vote for it.

Proposition 40 was spearheaded by Dave Regan, who leads California’s large and powerful health-care workers’ union, in response to the Medicaid cuts in Donald Trump’s One Big Beautiful Bill Act. If approved, the initiative would create a onetime 5 percent tax on all billionaire wealth, and the proceeds—perhaps as much as $100 billion—would be earmarked mostly for state health-care spending. To make sure the superrich don’t flee before they can be taxed, the policy would apply retroactively to anyone who lived in the state at the start of 2026.

Predictably, some of the billionaires in question are seeking to defeat the initiative. The Google co-founder Sergey Brin preemptively moved his residence and businesses to Nevada in 2025 and seeded the new political organization Building a Better California with $102 million from his stash. (That might sound like a lot, but the tax would have cost him about $12 billion.) Thanks to the donations of other tech tycoons, the group has raised more than $333 million in total.

Plan A is to convince voters that Proposition 40 is unwise via a barrage of TV and social-media ads. In case that doesn’t work, the opponents have come up with Plans B and C: Propositions 41 and 42. These initiatives take advantage of a feature of California law: If two conflicting ballot measures pass in the same election, the one with more votes prevails. On the surface, both look innocuous and unrelated to the wealth tax. Proposition 41 is being pitched as a fiscal-responsibility measure, and Proposition 42 is ostensibly about protecting voters’ retirement savings. But the initiatives are designed to directly conflict with the wealth-tax measure. Proposition 41 would institute audit requirements for new special taxes and void any programs that are exempt from the state’s existing spending limit, which the new wealth tax would be. Proposition 42 would prohibit both retroactive taxes and any taxes on non-real-estate property, each of which describes Proposition 40.

This tactic is completely legal, and efforts to change the rules could have unfortunate downstream consequences. For instance, if counterproposals were disallowed, then a group that caught wind of an upcoming initiative could block it simply by being the first to gather enough signatures. Still, the rule can, perversely, lead to antimajoritarian outcomes by preventing proposals supported by more than half of the population from becoming law if another proposal on the ballot happens to, or is designed to, negate it.

Propositions 41 and 42 also take advantage of the possibility that voters will not realize that the measures conflict, and will vote yes on more than one of them. They might think that audits are sensible and that spending limits should be observed, or that personal property such as cars and engagement rings and 401(k)s shouldn’t be taxed, and fail to understand that these principles stand in the way of their belief that billionaires ought to pay a wealth tax.

Other voters might prefer audits to a wealth tax even though they’d be perfectly fine with both; in that sense, the countermeasure forces them to choose between two policies that could coexist. Still other voters are likely to be overwhelmed or annoyed by having to parse so many measures and decide to oppose all of them: Political scientists have found that the longer the ballot, the more likely people are to vote no.

Historically, Californians are not easily fooled by this type of gamesmanship. But in a close contest, only a small subset of voters needs to fit into the above categories for the countermeasure strategy to work. Imagine that 51 percent of voters want a wealth tax and 49 percent oppose it. If all of those who oppose it vote for Proposition 41, knowing that the measure will negate Proposition 40, and just 3 percent of the electorate votes for both, then Proposition 41 will pass with 52 percent of the vote, nullifying the wealth tax that 51 percent of Californians voted to approve.

Polls indicate that this outcome is possible. A September survey by the Public Policy Institute of California had the wealth tax passing 52–46, Proposition 41 passing 51–44, and Proposition 42 passing 54–43, which would result in only Proposition 42 (the one about taxing property) going into effect. (A more recent poll by the same organization showed the wealth tax at only 46 percent support.) A poll from UC Berkeley found that a larger slice of the electorate was undecided about the countermeasures than about Proposition 40, suggesting that some voters don’t realize the measures conflict.

At the turn of the 20th century, many western-state legislatures were captured by the owners of local railroad and mining monopolies. Progressives and populists introduced ballot measures as a way to circumvent those plutocrats and return power to the people. But, as the fight over Proposition 40 shows, that works only if voters can withstand plutocrats’ efforts to capture the ballot-measure process too.