RE: LeoThread 2026-01-15 14-10

It has been underreported how much wealth has already left California due to the proposed asset-seizure tax.

A private poll of affected individuals found 80–90% have either left in 2025 or plan to leave in 2026 if the ballot measure looks likely to pass.

Roughly $2–2.5 trillion of assets are estimated to be gone, costing the state about $20 billion in annual revenue and putting hundreds of thousands of jobs at risk.

An even larger exodus is occurring among those not directly targeted who fear the law will expand beyond billionaires.

The initiative would allow legislators to seize post-tax assets by majority vote, effectively eroding private property rights.

Under this approach, private assets could be treated as public property, with legislators deciding what people may retain and use each year.

Numerous founders, CEOs, and other business leaders are actively relocating companies out of state—beyond tech and AI—threatening the core economic engine that has supported California for generations

How this could unravel the broader economy:

• About ten states have explicit or implicit prohibitions against an asset-seizure tax
• Affected individuals are likely to move to states that protect private property rights

• California already faces a $20–30B annual budget deficit, an unfunded ~$1T pension liability for public employees, and ~$500B of debt outstanding

• Limited borrowing capacity may push the state toward further asset seizures to meet obligations
• Seizures could begin with millionaires and expand to the middle class, accelerating departures

• Deficit, debt, and job losses could spiral, producing a large-scale exodus
• No U.S. state has declared bankruptcy; many states face similar fiscal pressures from promised benefits and unchecked waste

• Struggling states may request federal assistance, effectively federalizing state debt; other states and residents could react strongly, raising the risk of constitutional and civil tensions

This chain of consequences may seem extreme but follows logically from selectively removing private property protections.

While many affected are not ultra-wealthy, and inequities in the state deserve attention, eliminating private property rights would be harmful for everyone

Possible alternatives include:

1. With a roughly $350B annual budget, cutting wasteful programs could likely recover ~$50B per year
2. If additional revenue is needed, tax loans on unrealized capital gains, limiting tax-free rollovers of certain appreciated assets, and implementing a step-up in basis on inheritance could raise multiple billions
3. Converting public retirement plans from Defined Benefit to Defined Contribution would address the ~$1T+ unfunded liability and relieve long-term fiscal pressure

These facts point to the need to resolve fiscal problems without undermining property rights or tearing apart the state and nation