Props 41 & 42: Hell fuck no
Prop 41: “Prohibit Excluding New State Taxes from Spending Limit and Require Special Tax Audits Initiative”
Prop 42: “Prohibit New Taxes on Retirement Holdings, Personal Assets, and Savings and Limit Retroactive Taxes Initiative”
These propositions exist only because of the rule that self-serving billionaires get multiple chances to win fights that democratic voters have to win every time. They are really bad on their merits, but they are also good examples of how billionaires get to rewrite the state’s actual tax policy—enacting far-reaching and, on their own terms, very bad changes—just to get to the one thing that they really want. In this case, that’s killing Prop 40 so as to remain untaxed, which, if either of these pass, will happen. That these propositions are only on the ballot because billionaires will spend incredible sums of money to keep from having to pay even the most modest rate of taxation on their wealth, we will hasten to emphasize, is a goddamn insult to democracy.
It is also a reflection of what careless people the billionaires are, to use the term of art: They will do a big thing, with lots of messy and far-reaching and complicated effects, in order to get what they want, and then all the mess that’s left after will be someone else’s problem. The existence of these propositions on your ballot, just by itself, is a great argument for the dissolution of billionaire wealth. This is what they spend it on, to avoid spending it on people not dying of preventable and treatable injuries and diseases.
Anyway: Prop 41 is written so that you see phrases like “pre-election financial and performance audits of tax-related ballot initiatives” and “state audits every four years to determine program effectiveness and cost-saving measures” and think: “oh, nice, finally some discipline! Scrutiny of taxation! Effectiveness!” It’s also framed so that making it harder for the government to collect taxes feels like fiscal responsibility, instead of what it is, which is making the government spend money so that it has less money to spend. And that’s not even the point, though the rhetorical games being played to frame and obscure that should demonstrate the kind of attitudes they embody; the real point of Prop 41 is the following phrase, which is framed so that you have no idea what it’s even saying: “Nullifies state taxes enacted after January 1, 2026 that exempt their revenues from voter-approved state spending limit.”
What it should say, if it was meant to be understood, is: The Tax Revolt Is Your Only God, You Will Have No Other. The Gann limit (see also our Proposition 2 entry) would apply to all new taxes. It definitely takes out Proposition 40—which produces special new revenues, and thus spending, that would be exempt from the Gann Limit—but it’s also, as such, a casual shotgun blast aimed at the state that will kill a lot of other things, too, after it hits its target. And there’s something kind of maddening about that, about how carefully it’s crafted to definitely take out Prop 40, but then phrased so vaguely that you can’t see that intention clearly, and then precisely because of that sleight-of-hand vagueness, it becomes a much more damaging and far-reaching piece of legislation. It would do less actual damage if it was just called the “you can’t tax billionaires, you peasants” proposition. But then you might vote against it. In order to trick you, you’ll get the even worse version of the “you can’t tax billionaires, you peasants” bill.
Oakland Review of Books
Prop 42 also sucks on its own merits, so naturally, Gavin Newsom—a snake who should be cast into infamy forever—is hugely for it. It’s basically a lie; the messaging on it is about how it protects your pensions and retirement from being taxed, which is a way to imply that Prop 40 doesn’t have a specific “this doesn’t apply to pensions and retirement accounts” provision, which it does. But again, while the backers will try to convince you that this is about protecting your retirement accounts, it’s essentially a prohibition on any or all wealth taxes, going forward. It’s the “make California a tax shelter for billionaires forever” proposition, with the added bonus for Sergey Brin that it bans precisely the kind of retroactive tax that Proposition 40 is designed to be (and has to be, if it’s to successfully force billionaires to pay taxes). After all, if Prop 40 wasn’t the kind of retroactive tax it is, billionaires would find it relatively easy to shift their wealth to avoid paying their fair share. Prop 42 is designed, therefore, to make the billionaire tax shelter that is your state an even larger and more capacious shield for billionaire wealth generation and preservation. Thanks, Gavin, you running dog!
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