Rep. Ro Khanna went on the podcast "Conversate with Killer Mike" this week to defend California's Proposition 40, a one-time 5% tax on the net worth of the state's roughly 200 billionaires. His closing argument: "You didn't build this money yourself."
Then, in the same breath, he gave them partial credit. "Yeah, you were entrepreneurial, you had some genius, you worked hard," Khanna said, before listing the government-funded internet, AI research and universities. By the math of a 5% tax, that's 95% genius and 5% DARPA. Most of us would take that grade on any report card we've ever brought home.
Let's run the numbers, because the numbers are the joke.
Khanna said there is $25 trillion of wealth in his district and the 50 miles around it. He called that one-third of the nation's wealth. He also said those billionaires' wealth rose 144% in three years. Your 401(k) rose 144% too, if you count from the day it was opened to the day you looked at it and closed the app.
He said America has 989 billionaires, and that they pay little income tax because their wealth grows through stock valuations, not paychecks. "They have no income," Khanna said. Neither do you after rent, but nobody's holding a ballot measure about it.
The one-time tax, he said, is meant to raise $100 billion to keep 3.5 million Californians from losing health insurance. One time. Health insurance, last we checked, bills monthly. California is proposing to pay a subscription with a garage sale.
Khanna also previewed the sequel. He and Bernie Sanders have a plan for a 5% tax every year for five years, which he said would raise $4 trillion over 10 years. The wish list: free trade schools, free college, free childcare, $60,000 teacher pay, and an $11,000 check for every family under $150,000. Note the word "free" appears three times in one sentence, which in accounting is what we call a liability.
The opposition is not coming from Republicans alone. Gov. Gavin Newsom opposes Prop 40 and has warned it could drive wealth out of the state. Khanna's explanation, on the podcast, was that some Democrats "don't want to offend these billionaires because they want their money for running for office." So the case against the tax, per the tax's biggest fan, is his own party's fundraising.
Voters will also see Propositions 41 and 42, which could cancel out Prop 40 if they get more votes. California has written a ballot where one measure taxes billionaires and two measures exist to un-tax them. It's the only state where the ballot comes with its own refund policy.
Here's the part nobody in Sacramento says out loud. When a billionaire leaves, he takes a jet. When the bill arrives, it takes the bus, and it stops at your house.
So Khanna's message stands. You didn't build that money yourself. You just get to keep 95% of not building it, which is still a better return than anyone in California has gotten on a state program since the high-speed rail broke ground.
This article is satire. The Demorat is a parody news site; real facts are drawn from the linked sources, and jokes, invented scenes, and fictional characters are not real.
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