A single vote on California's November ballot is being watched far beyond the state's borders. At stake is a union-backed proposal to tax billionaires — a measure supporters say would raise US$100 billion for state-funded healthcare, food assistance and public education, and one that has already drawn a furious, well-funded counterattack from the ultrawealthy themselves.

Part of that attention reflects the state's sheer scale: California has the largest economy of any US state — one that would rank among the world's five biggest if it were a country — and no US state currently taxes wealth itself rather than income, which is part of why the outcome is being watched so closely.

Google co-founder and billionaire Sergey Brin has already spent US$100 million on political donations to a group opposing the tax. Brin is hoping to avoid a potential tax bill of US$13 billion, a return of roughly 130 to 1 if that investment proves successful. Ballot measure fights in California routinely attract nine-figure spending — the 2020 gig-economy measure Proposition 22 became the most expensive in state history at more than US$200 million — but a single US$100 million donation from one individual puts Brin's giving in rare territory.

The measure and the backlash

Advocates of the billionaire tax claim the US$100 billion it would raise would be allocated directly to state-funded healthcare, food assistance and public education. Supporters of the union-backed proposal also highlight that most billionaires currently pay lower marginal rates of tax than the average worker, and that the revenue is desperately needed to fill gaps in funding created by US President Donald Trump's cuts to Medicaid. That imbalance persists largely because most billionaire wealth sits in unsold shares, whose gains go untaxed until they are realized — wealth a conventional income tax never reaches, and which a levy on wealth itself is designed to capture.

Critics — including California's Democratic Governor Gavin Newsom — argue the measure will drive billionaires and their tax revenue out of the state. California already levies the highest top income tax rate of any US state, and its budget is unusually reliant on capital gains paid by a narrow slice of top earners, which makes state finances swing with the markets. Studies of California's 2012 top-earner tax increase, however, found that most millionaires stayed put rather than leaving.

Brin is not alone in funding the opposition. Other billionaire donors, including Peter Thiel, Eric Schmidt and Chris Larsen, have also spent significantly to oppose the tax. Brin's campaign committee has additionally organized competing ballot propositions which, if passed, would nullify the tax.

For now, polling suggests the billionaire tax is supported by a majority of voters, and more than 1.6 million Californians signed the petition that put it on the November ballot.

Taxing the ultrawealthy, at home and abroad

Similar measures targeting the ultrawealthy are currently under consideration around the world.

The idea is not new in Europe, where wealth taxes were once widespread: most countries have since repealed them, France scaled its levy back to cover only real estate in 2017, and only a handful of European states — including Norway, Spain and Switzerland — still tax wealth directly.

In New York, Mayor Zohran Mamdani has proposed a 2% income tax increase for those earning over US$1 million, and has passed a property surcharge tax on second homes. Other US states — including Washington state, Maine and Minnesota — have passed or are considering similar income or wealth tax measures.

In the United Kingdom, a group of 120 millionaires has launched a "Proud to Pay" campaign asking the government to levy an additional 2% tax on wealth over £10 million.

Spiralling global inequality

Behind the public discussion of California's billionaire tax lies a much deeper debate about spiralling global inequality.

Recent data from the US shows the share of economic output flowing to workers has dropped to a record low of 52.9% in 2026. That means for every US$100 the economy produces, workers take home US$52.90 in pay — the smallest share since records began in 1947. Similar trends have been observed around the world.

Billionaire wealth, conversely, has accelerated rapidly. As of 2026, Forbes reports a global record 3,428 billionaires. Perhaps most symptomatically, in June Elon Musk briefly became the world's first trillionaire after the public launch of SpaceX; his wealth now sits at around US$800 billion.

The causes of inequality

Some blame globalisation for this explosion of inequality, but two other important related factors also deserve consideration.

The first is the global decline of the trade union movement. With union membership and power declining around the world, the ability of workers to negotiate for better wages has declined as well.

The second is a trend of corporate consolidation into a small number of large "superstar firms". These companies, which include tech giants like Alphabet, Amazon and Uber, wield monopoly-like powers — reducing competition and allowing these firms to drive down wages.

The rise of artificial intelligence and automation will only accelerate these trends, enabling the largest firms to shed even more workers even as their output and profitability continue to climb.

Workers feel the crunch

For the last couple of decades, stagnating wages have been propped up by cheap access to credit. With central banks using unconventional policies to keep interest rates low, household spending remained largely stable — funded by an increase in household debt.

With inflation rising, however, central banks around the world have pushed interest rates up from the emergency lows of the pandemic era, cutting off that source of cheap credit. With inflation rising faster than wages, the effect has been real declines in living standards.

Unsurprisingly, voters are unhappy with this "cost of living" crisis, and all over the world have turned away from incumbents and established parties.

A jump to the left?

If the previous decade's politics have been dominated by dissent on the right, many countries are now seeing the emergence of stronger dissent on the left.

After Mamdani's headline-grabbing victory in New York, Democratic Socialists have ridden a wave of momentum to win a series of primary races. Beyond the US, left-independent Catherine Connolly has been elected Irish president, the Greens have risen in the UK, and left-wing Die Linke has recently resurged in Germany.

These different parties and leaders share a focus on combating growing global inequalities of wealth and power. Billionaires, as the most obvious and visible symbol of those inequalities, are an obvious target. However, as California's proposal shows, attempts to rein in the wealth and power of billionaires should expect furious backlash from the billionaires themselves.

The future of wealth inequality

California's coming election will serve as an important test of the political power of the billionaire class — and of the broader health of American democracy.

Yet even if the tax is successful, taxing billionaires treats only a symptom of global inequality rather than addressing its underlying causes. A policy agenda for seriously addressing wealth inequality must therefore also include a much broader suite of measures — such as improving workers' bargaining power, breaking up monopolies, and public ownership of AI technology.

Without these structural fixes, voter anger and the current political instability around the world can be expected to continue to escalate.

Henry Maher, Lecturer in Politics, Department of Government and International Relations, University of Sydney

This article is republished from The Conversation under a Creative Commons license.