The proposed California "entrepreneur's tax" is not a one-time levy on billionaires. It's viewed as the first step toward an annual tax on paper wealth, with thresholds planned to drop to $25M. This would impact founders with illiquid equity post-Series B, forcing a mass exodus before an IPO.

The proposed tax on billionaires' assets isn't about the billionaires themselves, who hold a fraction of national wealth. The real goal is to establish the legal precedent for a private property tax. Once normalized, this mechanism can be extended to the middle class, where the vast majority of assets reside.

The historical record shows that wealth taxes cause capital flight on such a large scale that they ultimately reduce a government's total tax revenue. For example, after France introduced one, 42,000 millionaires left with €200 billion, forcing the government to later abolish the tax.

Threatening to confiscate wealth from the most mobile people incentivizes them to leave. This capital flight has already begun in response to the proposal, proving such policies ultimately reduce the state's long-term tax revenue by driving away the very people they aim to tax.

When a government must implement a punitive tax to prevent its most successful citizens from renouncing citizenship, it's a clear admission that its domestic policies are failing. It signifies a shift from incentivizing contribution to coercing compliance, a hallmark of a declining state.

Billionaire wealth taxes are easily dodged by relocating. A more robust policy would tax capital gains based on the jurisdiction where the value was created, preventing billionaires from moving to a zero-tax state just before selling stock to avoid taxes.

Proponents often describe wealth taxes as a "one-time" event to make them more palatable to voters. However, the true aim is not the initial revenue but establishing a permanent legal precedent for the government to seize private property. The "one-time" language is a deliberate misdirection to cross a legal and political Rubicon.

A proposed wealth tax in California sets a new precedent by targeting assets that have already been taxed as income. This fundamentally shifts taxation from income to private property, granting the government the right to assess and claim a portion of citizens' belongings, which undermines a core principle of the U.S. economic system.

Citing his firsthand experience with France's wealth tax, Manny Roman argues such policies often prove disastrous. The wealthy are mobile and can "vote with their feet" by moving to lower-tax jurisdictions like Belgium or Switzerland. This mobility undermines the intended tax base, rendering the policy ineffective.