Silicon Valley Spent $425m to Kill California's Billionaire Tax

Silicon Valley's elite spent nearly $425m to defeat California's billionaire wealth tax — the most expensive opposition campaign in state history, according to campaign finance filings. Proposition 40, a one-time 5% tax on the state's billionaires, is poised to fail by double digits. Proposition 42, a counter-initiative banning taxation on billionaire wealth backed by the same donors, passed.

Sergey Brin, Google's co-founder, gave at least $132m — more than any other donor. The Google billionaire's net worth stands at about $230bn. Eric Schmidt, former Google CEO, chipped in more than $48m as runner-up. Executives at Palantir, DoorDash, Stripe and Reddit, plus prominent venture capitalists, donated millions more.

Who thanked Brin on election night?

In the hours after polls closed, tech industry figures praised Brin on social media. "Huge thanks to Sergey Brin here," wrote Garry Tan, CEO of Y Combinator. Venture capitalist Ilya Sukhar posted: "God bless Sergey Brin." David Marcus, a crypto entrepreneur, kept it to one word: "Hero."

Over the final month, the campaign flooded the state with highly produced ads and mailers. Taglines branded Prop 40 an "everyone tax", a "reckless experiment" and warned voters "you're next". Supporters said the tax would fund the state's healthcare losses from Donald Trump's One Big Beautiful Bill Act. Opponents repeatedly told voters it would make healthcare funding worse.

How lopsided was the money race?

The pro-tax camp, sponsored by the union SEIU-United Healthcare Workers West, raised just over $31m. The billionaires outspent them nearly 14-fold.

"All lies have a shelf life," said Suzanne Jimenez, chief of staff for SEIU-UHW. "Billionaire-funded propaganda may mislead voters about the consequences of these cuts today, but as hospitals reduce services, emergency rooms close and families lose access to care, the truth will become increasingly difficult to hide."

The tax faced headwinds beyond money. Governor Gavin Newsom and governor-elect Xavier Becerra both opposed targeting billionaires. Support concentrated in Democratic-leaning, wealthy counties — Los Angeles, San Francisco and Bay Area counties voted yes. Red, rural, poor counties voted no by margins up to 80%, per the latest count, even where House races swung blue.

Is this a familiar playbook?

Rob Lalka, a business professor at Tulane University and author of The Venture Alchemists: How Big Tech Turned Profits Into Power, compared the campaign to Uber and Lyft's 2020 ballot drive, when the ride-hailing companies spent more than $200m to defeat a labor-rights initiative for drivers. Both used what he calls "misleading propaganda and paying for endorsements".

"The money also seemed astonishing at the time: the amount to influence the outcome, over $200m, was a massive sum," Lalka said. "Money in politics has only increased in California throughout this decade. That's the context for Prop 40 this election cycle."

Francesco Trebbi, a business and public policy professor at UC Berkeley, noted campaign spending shattered records nationwide this midterm cycle. He pointed to Elon Musk's $446m poured into House and Senate races — money that proved ineffective in places like Texas, where Musk's pick James Talarico won anyway.

"Maybe it was easier to decouple Prop 40 opposition from President Trump's agenda, so Brin had an easier target to hit," Trebbi said. He added: "We need a lot more data and statistical evidence in order to conclusively finalize this discussion."

Exit polls for Prop 40 haven't been released yet. Jimenez said the union isn't done: "If Sacramento fails to protect patients and deliver a real solution that makes billionaires pay their fair share, healthcare workers will pursue every available avenue, up to and including returning to the ballot in 2028 with a billionaire tax."