[Music playing in the background, “Do You Hear the People Sing” from Les Misérables:
“Will you join in our crusade? Who will be strong and stand with me?
Beyond the barricade Is there a world you long to see?”]
_____________
Whether you live in California or not; whether you’re a grant maker, nonprofit executive or an elected official anywhere in the United States, on the defining issue of our day, wealth inequality, being neutral is not an option. Unfortunately, as of this writing, many are.
The wealth tax initiative, Proposition 40 (“40”) on California’s ballot this November provides the clearest and most important opportunity to stand up for democracy and curb excessive wealth. My father would often say, “not voting is the same as voting for the other side.” Staying neutral or taking a “no stance” on the proposition is the same as being in bed with the oligarchs.
Yes, billionaires have extraordinary power over our lives. A vast majority of Americans work either directly or indirectly for billionaires–think Walmart, Amazon, Home Depot, Berkshire Hathaway. Virtually all entertainment and media are controlled by billionaires, and we can’t leave out the entire wealth defense industry or even the federal government.
Add in any person or organization dependent on noblesse oblige, particularly politicians and nonprofit leaders. As was reported in the New York Times, 300 billionaires and their families accounted for nearly one-fifth of all reported federal political contributions in 2024. And according to Inside Philanthropy, living billionaires or their children control 56 of the top 100 private foundations and may account for half of all philanthropic funding.
For the recipients of this largesse, it isn’t an easy decision to bite that feeding hand. Loni Hancock, who has had a distinguished career in government and politics and served as executive director 45 years ago of the foundation I chaired at the time, said something I’ve never forgotten: “You can only judge a person by how they handle themselves when making difficult decisions.” The verdict is out on many of the people for whom supporting a tax on the ultra-rich should be a no-brainer.
Politicians need only look at polling which consistently shows an overwhelming majority of voters in both parties support taxing the ultra-rich. But politicians operate in a system bought and paid for by the ultra-rich. As Jeffrey Winters points out in his critically important book, The Blind Spot, How Oligarchies Dominate our Democracy, the oligarchs want us to think we operate in a democracy, when all the time they are pulling the strings.
Nonprofits exist to fill the void left by our elected officials, yet too many (what is too many: anything more than zero) of their leadership have, by staying out of the fight, chosen billionaires over the people they are supposed to serve. Their constituents are precisely the ones harmed most by the oligarchs.
As I’ve often written, virtually every issue nonprofits care about has wealth inequality at the root of the problem. For example, every environmentalist should be out knocking on doors in support of taxing the ultra-rich because billionaires a) get the anti-environment legislators elected; b) choose profits over the environment in the companies they run, such as oil companies and AI; and c) with opulent homes, private planes and yachts, they are responsible for extraordinary environmental damage. The same could be said about housing, food supply, healthcare, and more broadly, shared prosperity and affordability. Taxing billionaires is not mission creep.
The refrain I hear from “neutralists,” quoting from the billionaires’ handbook, is that 40 is poorly written. This is code for “I haven’t actually read the initiative, I wasn’t at the table when it was put together and nobody asked me for my advice before it got on the ballot, and that just pisses me off.” When did nonprofit and union leaders become so petty? For the record, I wasn’t at the table, either.
The California Teachers Association (CTA), one of the most powerful political forces in California, is a prime example of how personalities trump policy. For various reasons (in this case, “poorly written” includes not enough of the 40 revenue going to education), they not only opposed 40 but put the squeeze on politicians and even on organizations like California Calls, which is made up of 31 grassroots, community organizations, to stay neutral. Grassroots organizations in cahoots with billionaires?
Let’s just review the facts about the initiative. It is a one-time 5% wealth tax on the 200+ billionaires in California, whose total wealth exceeds $2 trillion. The wealth of this small group of billionaires increased by an astonishing $400 billion in the last 20 months–four times greater than the tax they are being asked to pay. Most (not all) of the $100 billion in revenue fills the healthcare gap created by Trump’s H.R.1. Currently billionaires pay just a measly $2 billion in income taxes in California each year, about 1% of state revenue.
I doubt “neutralist” nonprofit organizations are suggesting we let millions of Californians go without healthcare? But if billionaires don’t pay this tax, who is going to foot the bill? Answer: The working and middle class. To my knowledge, no politician or nonprofit organization has suggested an alternative way to fill the $100 billion gap.
Contrary to the critics, making 40 a one-time tax (payable over five years) was brilliant. It eliminates the incentive for billionaires to leave the state to avoid the tax (as a practical matter, it is extremely difficult for a billionaire to do this in any case). And if the tax works as well as its supporters expect it will, then the public can decide to do it again 5 years hence.
California’s oligarch-in-charge, Governor Newsom, is using every trick in his book to protect his billionaire friends. Katie Porter, so-called progressive, wrote a silly op-ed opposing 40, within days of Newsom appointing her to the California Community Colleges Board. Maybe a coincidence? In the most shameless example, Planned Parenthood California opposes the initiative. Why? You guessed it: It is “poorly written!” “We weren’t consulted.” And, to paraphrase, it is only one-time and ongoing revenue is needed. Sound familiar? Get the logic: there is no proposal or even source for ongoing revenue, so we should skip the chance to get a major life-saving infusion of cash now? Someday the truth will come out as to why Planned Parenthood California leadership chose to abandon its constituents, the ones who will suffer most by cuts to California’s healthcare system, but Newsom’s fingerprints are on it.
California ballots will be sent out October 5, the same day that Excessive Wealth is hosting an all-day educational conference in San Francisco, US vs. Billionaires. Support for 40 has remained steady, despite the $100+ million the billionaires are spending to confuse voters, but winning requires all-hands-on-deck. “Neutral” is not an option.
The June Rebellion of 1832 in Paris, an anti-Monarchist rebellion, was captured in the musical, Les Misérables, which like today raised the question: “Who will be strong and stand with [us]?”
p.s. I encourage you to read “The Whole World Is Watching” for more on the wealth tax initiative.