Did California Really Lose $1 Trillion Fast?
California is in the middle of a big argument over a proposed one-time tax aimed at ultra-wealthy residents. The number people are talking about is huge. Some say nearly $1 trillion in wealth left the state in a single month. That claim grabbed headlines.
Venture capitalist Chamath Palihapitiya posted on X that “Collectively, the amount of Billionaire wealth that has left California in the last month (!) is now in excess of $700B.” He added, “That means the $2T of California wealth they expected to tax is now down to $1.3T and falling quickly.”
Palihapitiya also warned, “I would not be surprised if 2026 ended with less than $1T of billionaire wealth in California and decades and hundreds of lawsuits,” and called the push “A complete and total unforced error. Where was the Governor? Where are our leaders??”
The proposal under debate would hit residents worth more than $1 billion with a one-time 5% levy based on net worth at a specific date. Governor Gavin Newsom has publicly expressed reservations about the plan. Supporters say it would raise money for schools and services. Opponents say it would push people — and tax revenue — out of the state.
Numbers like $700 billion or $1 trillion come from private estimates and fast changes in reported holdings. Valuations of private companies swing. People can change legal residence. And market moves can inflate or deflate headline totals overnight. That makes single-month figures noisy and hard to confirm.
Analysts say there are three things to watch. First, how many wealthy individuals actually change residency or shift assets out of reach of the tax. Second, what rules courts set if the tax is enacted. Third, how much of the claimed outflow is real versus paper value changes.
Either way, this debate highlights the trade-offs around big taxes on the very rich. Policymakers will have to weigh short-term revenue goals against possible long-term impacts on investment, jobs, and tax base.
The proposed "wealth tax" is already causing an exodus from California. It turns out successful individuals would rather not have the government seize their assets simply to create a bigger pot of money for fraud, waste, and corruption. pic.twitter.com/Zz1fkO1urq
— Kevin Kiley (@KevinKileyCA) January 3, 2026