Tech Titans Spend $425 Million to Defeat California Wealth Tax
Silicon Valley leaders led a record-breaking opposition campaign that successfully blocked a proposed one-time tax on billionaire assets in California.
By Larissa Bell ·
In the hours following the close of polling on election day, prominent figures in the technology industry took to social media to praise Sergey Brin, the co-founder of Google. Garry Tan, the CEO of Y Combinator, expressed his gratitude with the words, “Huge thanks to Sergey Brin here.” Venture capitalist Ilya Sukhar posted a similar message, while crypto entrepreneur David Marcus simply labeled Brin a “Hero.” These public displays of thanks highlighted Brin’s central role in the defeat of California’s Proposition 40, a ballot measure that sought to impose a one-time 5% tax on the state’s billionaires.
The proposed tax is expected to lose by double-digit margins. At the same time, Proposition 42, an opposition initiative that would ban any taxation on billionaire wealth, passed the ballot. This initiative was placed on the ballot by Brin and a group of other ultra-wealthy individuals in the state. According to campaign finance filings, Silicon Valley’s elite raised nearly $425 million to defeat the tax, making it the most expensive opposition campaign in the state’s history.
Brin, whose net worth is estimated at approximately $230 billion, contributed at least $132 million to the fight, making him the largest single donor. Eric Schmidt, the former Google CEO, was the second-largest contributor with more than $48 million. Additional millions came from executives at companies including Palantir, DoorDash, Stripe, and Reddit, as well as prominent venture capitalists. Over the past month, the opposition campaign used these funds to flood the market with high-production advertisements and mailers that warned voters the tax was dangerous and would negatively impact everyday people.
Campaign materials for the opposition used taglines describing Proposition 40 as an “everyone tax,” a “reckless experiment,” and a situation where “you’re next.” Supporters of the tax argued that the revenue would help cover healthcare losses resulting from Donald Trump’s One Big Beautiful Bill Act. In contrast, opponents consistently argued that the tax would worsen healthcare funding. The pro-tax campaign, sponsored by the union SEIU-United Healthcare Workers West, faced a difficult task in convincing Californians that this specific measure was the appropriate response to the federal funding changes.
The political landscape also posed challenges for the tax measure. Major political figures, including Governor Gavin Newsom and Governor-elect Xavier Becerra, opposed the idea of targeting billionaires. The funding disparity was stark. The pro-Proposition 40 camp raised just over $31 million, leaving them outspent nearly 14 to 1 by the opposition’s war chest. Suzanne Jimenez, the chief of staff for the union, noted that while billionaire-funded propaganda might mislead voters in the short term, the truth about reduced services and closed emergency rooms would eventually become harder to hide.
Voting patterns revealed a clear geographic divide. Counties that supported Proposition 40 were typically more Democratic and home to many of the state’s wealthy residents, including Los Angeles, San Francisco, and other Bay Area locations. Conversely, counties that overwhelmingly rejected the measure were mostly rural, poor, and red. In some of these areas, up to 80% of voters voted no on the proposition, even as they swung blue in U.S. House races during the same election.
Rob Lalka, a business professor at Tulane University, compared this campaign to the 2020 efforts by Uber and Lyft, which spent over $200 million to defeat a labor rights initiative for drivers. Lalka described the tactics as involving misleading propaganda and paid endorsements, noting that the amount of money in California politics has increased significantly throughout the decade. Francesco Trebbi, a professor at the University of California, Berkeley, observed that while Elon Musk spent $446 million on national races, the opposition to Proposition 40 may have been more effective because it was easier to decouple from President Trump’s agenda.
Exit polls for the proposition have not yet been released, so further details on voter motivation remain unavailable. However, union leaders have indicated they are not finished with the fight. Jimenez stated that if the state fails to protect patients and ensure billionaires pay a fair share, healthcare workers will pursue every available avenue. This includes the possibility of returning to the ballot in 2028 with a new billionaire tax initiative.
