America’s tech industry, driven by the rapid development of artificial intelligence, is creating more wealth than the world has ever seen.
Elon Musk, who holds a bigger share of that wealth than anyone else on the planet, says we could be heading toward an era of super abundance where no one has to work and everyone is living a comfortable life because each person will have a share of the new wealth.
Musk also has big dreams of human colonization of Mars and, given current political realities, I’d say his Mars dream is more likely to be realized than his earthly egalitarian utopia.
The reason? No matter how rich they may be, the typical wealthy person reflexively resists sharing their good fortune by paying more in taxes. Plus, there is a political party — the Republicans — dedicated to letting the rich keep every cent they possibly can.
Some states are blessed to have more millionaires and billionaires than others — states like Washington and California, for instance. Many people in those states think a portion of that expanding wealth should be taxed and used to improve the lives of the 50% of the population that scrapes by every month on incomes that do not cover the rising cost of living.
In Washington, that impulse has taken the form of a new, annual 9.9% tax on any income above $1 million. In California, it comes as a ballot proposal, Proposition 40, that would put a one-time, 5% tax on the net worth of any billionaires residing in the state on Jan. 1, 2027.
The negative response to those measures does not exactly align with Musk’s share-the-wealth vision of the future.
In California, superrich Meta CEO Mark Zuckerberg threatened to take his money and leave the state if the tax proposition is approved by voters. He was only persuaded to stick around when Meta’s board of directors concocted a stock plan that would cover the tax hit.
If I-645 fails and the tax is implemented, the state will face a second test, what might be called the Zuckerberg question: How many millionaires and billionaires will abandon the state and head to Texas or Florida or some other low-tax jurisdiction?
It is very hard to share the wealth if the wealthy do not want to share and if they can simply move away.
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