Far-left progressives are trying to rally up support for California’s controversial one-time 5% tax on billionaires that’s up on the November ballot — but famed businessman Mark Cuban on Saturday delivered a brutal assessment to one of the tax’s biggest supporters.
Cuban, himself a billionaire, chastised Democratic Congressman Ro Khanna for supporting the tax: “Ideology is not a strategy.”
Khanna, a potential 2028 White House contender, was celebrating on X that the California Democratic Party endorsed Proposition 40 in defiance of more mainstream Dems such as Gov. Gavin Newsom.
“California voters want a Democratic Party that will stand up for the working class over the billionaire class,” the congressman proclaimed.
But Cuban said Khanna was not assessing the situation accurately.
“Ro, I like you. You know that. But you need to read the state of the state,” he tweeted at Khanna.
Cuban lauded the number of “unicorn” startups in the state, powered by Silicon Valley, that seems to be growing every day. Those startups often can can raise billions of dollars as investors chase after the AI frenzy, meaning founders can become billionaires overnight — and then find themselves taxed.
“They are the definition of cash poor, stock rich,” Cuban explained, adding it would be difficult to tax people in that situation.
“Do you really think each of multiple founders, who started an amazing company in Cali and is now a billionaire, can each just pull out $250m per billion of net worth from their raise? You know they can’t.”
If Prop 40 passes, Cuban claimed businesses and investors, including himself, would definitely seek to avoid California; in fact, he said he would make it a requirement to not be based in California.
“You can bet if I’m investing in a multi- billion dollar startup, I’m asking them to move from California first,” he said. “If this passes, only idiot startup founders stay in Cali.”
The congressman still seemed to not be convinced, replying to Cuban with a question on another potential way to tax billionaire startup founders even if their net worth isn’t in cash.
Californians are currently divided over Prop 40, according to a recent poll, which showed 48% support compared to 41% who opposed. About 11% are undecided.
It’s especially important for Prop 40 to garner as many “yes” votes it can as billionaires like Sergey Brin have poured money into competing ballot initiatives that may override it. Typically, the initiative that gets the most votes is the one that goes into effect.
The proposed tax has split Democrats, with many labor groups backing it as a way to offset federal health cuts but prominent figures like Newsom worrying it will destroy the state’s economy.