OPINION: Robbing the Rich Won't Bring Economic Justice

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By Duvi Honig Tuesday, 11 August 2026 03:29 PM EDTCurrent | Bio | Archive

The Golden State Wants to Make Robbing the Rich Legal

California has decided that theft becomes respectable when enough people vote for it.

Proposition 40 would impose a one-time 5% tax on the accumulated wealth of California residents worth more than $1 billion.

It’s not a tax on income earned this year, profits realized through a sale or money received in a transaction. It is a government claim against property people already own.

Supporters estimate that roughly 200 individuals would be targeted and that the measure could collect approximately $100 billion, primarily for healthcare programs.

The California Democratic Party has now endorsed it, giving political legitimacy to an idea that should disturb every American, regardless of personal wealth.

Calling something a tax does not automatically make it legitimate.

Suppose Congress proposed allowing the government to confiscate 5% of the property belonging to one unpopular group of Americans because the U.S. Treasury was running short of money.

Would the confiscation become morally acceptable merely because legislators approved it?
Would it become constitutional because a majority of voters liked the target?

Of course not.

The power to tax is broad, but it is not limitless.

Government cannot avoid constitutional protections simply by renaming confiscation an “excise tax” and placing it on a ballot.

Proposition 40 is being sold as a one-time emergency measure.

That phrase should alarm taxpayers rather than reassure them.

Governments rarely surrender a revenue source once they discover it, and today’s billionaire threshold can become tomorrow’s millionaire threshold once the original pool of money is exhausted.

The proposal would measure worldwide net worth and impose a 5% charge based on ownership of accumulated assets.

Real estate held directly would generally be excluded, while many business interests, securities and other forms of wealth would be included.

Taxpayers could spread payments over five years, but the obligation itself would be created by the value of what they own — not by income they received.

That is why the constitutional issue cannot be waved away.

California’s Constitution places strict limits on taxation of certain intangible property. Legal analysts have already identified a serious question over whether courts would treat this measure as a property tax despite its authors labeling it an excise tax.

Courts examine what a law actually does, not merely what politicians call it.

If the government calculates a charge by taking the total value of property someone owns and demanding a percentage of it, ordinary Americans understand what is happening.

The state is taking a slice of existing property because it needs money.

Supporters insist that billionaires can afford it. That misses the point entirely.

Constitutional rights do not depend on whether the victim is sympathetic.

Property protections mean little if they apply only to people whom the majority likes.

The entire purpose of constitutional limits is to prevent temporary political majorities from using government power against a smaller, unpopular group.

A billionaire’s wealth may be vast, but much of it is often tied to companies, investments and assets rather than sitting in a checking account.

To pay a tax based on paper value, an owner may need to sell shares, borrow money or surrender control of part of a business.

The government would effectively force private financial decisions without any sale, profit or taxable transaction having occurred.

California’s proposal is even more troubling because it reaches people based on residency at the beginning of 2026, before voters decide the measure in November.

That means someone who moved away during the year could still face a tax approved after leaving the state. Critics argue that this retroactive structure raises additional due-process and interstate-tax concerns.

Yet the loudest political argument against the measure is not that confiscation is wrong.

It is that other groups are not getting enough of the money.

Some organizations opposing Proposition 40 argue that its healthcare funding model is temporary, unreliable or harmful to programs they represent. Others worry that wealthy residents will leave California, taking future income-tax revenue, investment and jobs with them.

Those are legitimate economic concerns.

Even Gov. Gavin Newsom, D-Calif., and other prominent Democrats have opposed the proposal because of the possible damage to California’s economy and tax base.

But the most fundamental objection should come before the budget projections.

You do not seize private wealth merely because government coffers are empty.

California has one of the largest economies globally and has collected extraordinary sums from its residents.

If its budget cannot support existing promises, elected officials should explain where the money went, reduce waste, prioritize essential services and reform programs that are financially unsustainable.

Instead, Proposition 40 offers a politically convenient shortcut: identify a tiny class of residents, portray their wealth as a public resource and take enough of it to postpone difficult decisions.

That is not fiscal reform. It is a raid.

The claim that this will happen only once is especially difficult to believe.

A government facing structural deficits does not solve them with a one-time seizure.

It merely delays the reckoning. When the money runs out, politicians will return with a lower threshold, a higher rate or another supposedly temporary emergency.

Americans who are not billionaires should not celebrate.

Every confiscatory tax begins with a politically isolated target.

Once the principle is accepted — that government may take accumulated property whenever a majority believes the owner has too much — the only remaining debate is where to draw the line.

Today it is $1 billion.

Tomorrow it could be $100 million, $10 million, retirement accounts, investment portfolios, family businesses or the appreciated value of a home.

The danger is not that voters will suddenly feel sorry for billionaires.

The danger is that they will establish a precedent allowing government to convert envy and fiscal failure into legal authority.

A ballot can authorize legislation. It cannot transform injustice into justice.

And voting to take someone else’s property does not stop being theft simply because the people counting the ballots expect to receive a piece of it.

Duvi Honig is founder and CEO of the Orthodox Jewish Chamber of Commerce and founder of JBizNews. Read more Duvi Honig Insider articles —Click Here Now.

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OPINION: Robbing the Rich Won’t Bring Economic Justice

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