California Gov. Gavin Newsom’s endorsement of a national billionaire tax is being mocked by his own party who support a one-time state version of the tax, including Congressman Ro Khanna.
Khanna, speaking to reporters Friday, teared into Newsom for his “flip-flopping” in touting his national tax idea while opposing the state version, which will go before voters to decide on a one-time 5% tax.
“You can’t hypothetically say I support policies on a national level while ducking the fight in your own state, which is defining for the entire nation, and saying, ‘Well, I don’t want to upset the billionaires in my state, so I’m just going to punt this and say, hypothetically, we can solve something at a federal level,” Khanna said.
Newsom opposes the state tax proposal due to fears that California’s economy would be hurt in the long run after wealthy individuals flee to other states. He said Friday that “the fight to make the wealthiest Americans pay more in taxes is not one we should be fighting state by state.”
After failing a Thursday deadline to negotiate that tax from appearing on the ballot, the governor instead came out with a national idea that would “democratize” the economy.
Newsom’s national policy proposal is significant given he is widely expected to run for U.S. president in 2028. So is Khanna, whose clash with Newsom over the tax and other issues could preview a future Democratic primary showdown.
Dave Regan, president of the SEIU-United Healthcare Workers West, the union behind the state proposal, said in the appearance alongside Khanna that Newsom and others are wrong that there will be “capital flight” from the state tax.
Khanna, who has been trying to stake out a progressive lane in any potential buildup to a presidential bid, insisted Newsom’s announcement is misleading “propaganda.”
“The proposal with respect to what Governor Newsom has proposed federally is not a wealth tax,” Khanna said. “Taxing the loans on assets is something that the tech oligarchs themselves have proposed, because that will raise a fraction of the revenue of an actual wealth tax.”
The congressman said the tax fight exemplifies a crucial point in the future of the Democratic Party. He and others supporting the tax have slammed Newsom for siding with billionaires.
“I believe this is the defining fight on what side you’re on on this issue, for whether you’re an economic populist or whether you’re going to be for the working class or whether you’re still with the donor class of our party,” Khanna said.
“The reality is that what happens in California is going to determine the course of what happens in this country on this issue,” he added.
Political observers say Newsom’s latest move is him trying to play a fine line in appealing to the far left electorate for a presidential bid while also still maintaining the support of wealthy tech billionaire donors such as Ron Conway.
“Given that it’s going to be on the November ballot, this is the best possible alternative message for him to follow,” Dan Schnur, a professor of political communications at USC, told The Post. “‘I am for a billionaire tax — just not this one.’”
The state’s one-time tax measure is expected to generate a costly election fight that could climb to tens — if not hundreds — of millions, and it could shape Newsom’s presidential ambitions given he has vowed to defeat it.
Supporters of the tax said it’s needed to help make up federal cuts to health care.
“We believe Californians are ready to say that the most fortunate and the wealthiest people among us can put forth a modest one time 5% tax, so that millions and millions and millions of people will continue to have at least a stable health insurance system,” Regan said.
