California voters could soon decide the fate of one of the most consequential — and confusing — ballot measures in recent memory, and the outcome remains anyone’s guess.
Proposition 40 would place a 5 percent tax on the fortunes of California’s roughly 200 billionaires, with most of the resulting revenue earmarked for healthcare programs. Backers call it a long-overdue reckoning for the state’s wealthiest residents. But the measure’s path to passage is anything but straightforward, tangled up in union infighting, competing ballot initiatives and a leadership scandal that has handed opponents a ready-made talking point.
The measure is the brainchild of the Service Employees International Union-United Healthcare Workers West, yet it has drawn opposition from several other major labor organizations — an unusual alignment that puts unions on the same side as the billionaires Prop. 40 targets. Adding to the turmoil, Dave Regan, the union’s outspoken president, is facing serious misconduct allegations from fellow SEIU leaders, who say an independent probe substantiated claims of bullying, harassment, intimidation and even physical violence. Those officials have called for his resignation, saying their union must hold true to its values around respect and accountability. Regan has denied the accusations, but the controversy has become a liability for the campaign as it fights to win over skeptical voters.
Even if Proposition 40 clears the ballot, its future isn’t guaranteed. Wealthy interests opposing the tax have placed two rival measures before voters: Proposition 41, which would bar new taxes that exceed the state’s existing spending cap, and Proposition 42, which would prohibit any tax on personal property. Under California’s rules, if multiple conflicting measures pass, only the one receiving the most votes takes effect. That means a strong showing for either Prop. 41 or Prop. 42 could effectively cancel out the billionaire tax, regardless of how Prop. 40 fares on its own.
A recent survey from the Public Policy Institute of California illustrates just how tight the race has become. Support for Prop. 40 stood at 52 percent among likely voters, with 46 percent opposed — a margin narrow enough that either outcome remains plausible. Meanwhile, both rival measures showed slim leads of their own in the same poll. Notably, those surveyed were given only the official ballot summaries, without any explanation of how the three measures might interact or cancel each other out — a wrinkle that could catch many voters off guard once they’re filling out their ballots.
Mail voting is set to begin within weeks, giving campaigns on all sides a short window to sway an electorate that appears genuinely split.
Absent from the fray, at least publicly, is Gov. Gavin Newsom. Before Prop. 40 even qualified for the ballot, Newsom had voiced concerns that a wealth tax could push high-income residents and businesses out of California, potentially hurting a tax base that already relies heavily on the state’s top earners for income tax revenue. Since then, though, he has softened his stance, suggesting that taxing extreme wealth is better addressed at the federal level rather than through a single state’s ballot measure. Political observers note that Newsom’s shift may reflect his own ambitions beyond Sacramento — a potential presidential run makes alienating the progressive wing of his party over billionaire taxation a risk he seems unwilling to take, even as he stops short of endorsing Prop. 40 outright.
With labor unions divided, competing tax measures on the same ballot, and a scandal complicating the campaign’s messaging, Proposition 40’s fate looks likely to hinge on which side can cut through the noise and reach voters before ballots start arriving in mailboxes.
Original source: CalMatters
