California might be about to find out what happens when you tax billionaires hard enough that they actually leave. And Bill Ackman, the hedge fund manager who never met a hot take he didn't want to share, is sounding the alarm bells.
Ackman Takes Aim At California's Tax Strategy
The Pershing Square Capital Management CEO didn't mince words when discussing California's economic trajectory. In a post on X, Ackman declared the state is "on a path to self-destruction," pointing out that Hollywood has already seen better days and now the state risks losing the entrepreneurs who actually create jobs and drive economic growth.
His critique wasn't just about tax policy. Ackman also went after Democrats who continue praising Gov. Gavin Newsom, calling that position "crazy" given what he sees as California's increasingly hostile business environment.
The Billionaire Exit Plan
Ackman's comments came on the heels of a New York Times report revealing that some of Silicon Valley's biggest names are actively planning their California departures. Tech investor Peter Thiel and Google co-founder Larry Page are both reportedly considering cutting ties with the state before year-end.
According to sources familiar with the situation, Thiel has been exploring opening an office for his investment firm in another state and spending less time in California. Page, who's called Palo Alto home for years, has discussed leaving entirely. Companies connected to him recently filed incorporation papers in Florida, which notably has no state income tax.
The Tax Bill That's Scaring Billionaires Away
What's driving this potential exodus? A proposed ballot initiative backed by a California health care union that would slap a 5% wealth tax on anyone worth more than $1 billion.
Here's where it gets interesting: the tax would apply retroactively to anyone living in California as of January 1, 2026. Affected billionaires would get five years to pay up, but the numbers are staggering. Someone with $20 billion in assets would face a one-time tax bill of $1 billion.
For Larry Page, estimates suggest his tax liability could exceed $12 billion. Peter Thiel could be looking at a bill topping $1 billion. Those aren't rounding errors, even for billionaires.
Newsom Fires Back At Trump
Meanwhile, Governor Newsom has been busy fighting a different battle. Earlier this month, he accused President Donald Trump of pushing an economic agenda that enriches billionaires while leaving working Americans struggling, setting up an ideological clash with potential 2028 implications.
Trump's camp rejects that narrative entirely. They point to continued GDP growth, declining inflation, and stock market records as evidence their policies are working. In a November interview, Trump highlighted surging retirement accounts, arguing that market gains benefit working families through their 401(k) plans.
The irony, of course, is that while Newsom criticizes Trump for favoring billionaires, California's proposed wealth tax might actually be the thing that sends its billionaires packing. Sometimes the law of unintended consequences has a sense of humor.