Gavin Newsom’s 2028 billionaire tax idea is awkward populism

Traditionally, presidential politics in America kicks off after the midterm elections. But California Gov. Gavin Newsom appeared to be getting a jump on the 2028 competition on Friday, when he rolled out a plan for a “national economic reset” that would impose a new tax on billionaires. As if his intentions weren’t clear enough, his aides told CNN the announcement was meant to be part of his consideration of launching a formal presidential campaign.

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Yet there’s another way to read Newsom’s early proposal: as a burst of pre-presidential-run anxiety. 

Newsom’s announcement came just one day after a different proposal to tax the wealth of California’s billionaires officially qualified as a November ballot measure. Newsom opposes that measure, he says, on the grounds that it may harm California’s economy and doesn’t have well-designed social welfare benefits. 

As a White House hopeful desperate to build up populist bona fides, perhaps he sensed that opposing such a tax in the state he governs could make him look pro-billionaire. His national policy rollout could be an attempt to appear that he is not in the pocket of tech overlords.

I remain skeptical of Newsom’s awkward positioning. His argument against the California tax proposal isn’t particularly strong. And his new national policy rollout sounds like he’s trying to tax billionaires moderately and leave stronger options off the table. In other words, it looks a lot like Newsom wants to try to have his cake and eat it too.

A key part of Newsom’s opposition to the California ballot measure is the idea that it will make the wealthy leave the state — basically taking the tech billionaires who have threatened to move or are reportedly considering doing so at their word. But that’s not a strong case against it. As economists such as former Labor Secretary Robert Reich and University of California, Berkeley scholar Gabriel Zucman have pointed out, academic research on ultrarich migration and recent policy history suggest that few billionaires are likely to leave the state because of the tax — the economic benefits of staying tend to be far greater than those of leaving. 

Moreover, the policy is only a one-off tax of 5% designed to be impossible to escape, because it would be levied on people who lived in the state as of January 2026. So it would not be sensible for an executive to leave or move their company on the basis of that one-off tax alone.

Newsom also says he opposes the California billionaire tax because most of its revenue goes to only one category of state spending: helping provide revenue for healthcare services hit by the GOP’s Medicaid funding cuts. He describes the tax policy as turning a “blind eye” to other services, such as education. But that doesn’t seem like a strong basis for opposing the measure, which is necessary for health services for low-income Californians, and will free up state resources for other needs. My suspicion is that the capital flight threats are more central to Newsom’s position against the ballot measure.