AI Equity Scheme: Government Stake Incoming?

A California governor who failed at home now wants Washington to grab billionaire wealth and own a chunk of artificial intelligence in the name of “fairness.”

Story Snapshot

Gavin Newsom is campaigning against California’s one-time 5% billionaire wealth tax while demanding a new federal billionaire tax.
He also wants a federal “public equity” fund so Washington owns a major stake in the artificial intelligence economy.
Nonpartisan analysts warn California’s wealth tax could drive billionaires out and cost hundreds of millions in lost yearly revenue.
Newsom’s federal plan would raise taxes, grow government, and risk turning AI into another permanent Washington entitlement machine.

Newsom Fights California Billionaire Tax While Pushing a Federal One

California Governor Gavin Newsom is now calling for a national minimum tax on billionaires, even as he vows to vote against a billionaire wealth tax on the California ballot this November.^[2] He says the state measure, a one-time 5% tax on residents worth more than $1 billion, is the wrong way to go and warns it could hurt state finances if wealthy people leave. A nonpartisan state analysis backs that concern, projecting tens of billions in short-term revenue but likely long-term income tax losses in the hundreds of millions each year as billionaires move out.^[4]

Newsom argues that “the fight to make the wealthiest Americans pay more in taxes is not one we should be fighting state by state,” saying rich people can simply move to low-tax states like Texas or Florida to avoid targeted state taxes.^[3] His message is clear: he wants Washington, not Sacramento, to lead the charge on taxing wealth. Yet this comes after years of his support for higher taxes and heavy regulation inside California, which has already driven businesses and families to other states. Many conservatives see his new federal plan as a political pivot aimed at national office, not a serious fix for working Americans.

What the California Ballot Fight Reveals About Wealth Taxes

The California initiative backed by a major healthcare workers union would tax roughly 200–250 billionaires one time at 5% of their worldwide assets, with about 90% of the money promised to healthcare programs hit by federal funding cuts.^[17] Supporters claim it could raise around $100 billion over five years.^[18] But the California Legislative Analyst’s Office warns that while the tax could bring in tens of billions at first, billionaire departures and behavior changes could cut state income tax receipts by hundreds of millions of dollars or more every year, shrinking the long-term tax base that funds schools, public safety, and other core services.^[22]

Top Democrats are divided. Senator Bernie Sanders and other progressives cheer the wealth tax, framing it as making billionaires “pay their fair share.”^[16] Newsom and an unusual coalition that includes the California Teachers Association and major hospital groups oppose it, warning it would destabilize state finances and threaten funding for teachers and firefighters.^[1] Conservative economists go further, arguing that wealth taxes often raise far less than promised and can even reduce net revenue once capital flight is counted; one analysis of this California plan estimates real collections could be closer to $40 billion, not $100 billion, with possible net revenue losses once lost income taxes are factored in.^[24]

Inside Newsom’s Federal Billionaire Tax and AI “Public Equity” Fund

In a long Substack essay, Newsom lays out a national plan he calls a “true minimum tax on billionaires — a modern Buffett rule,” meant to ensure that the richest Americans cannot pay a lower tax rate than their workers.^[2] He targets practices where the ultra-wealthy borrow against stock portfolios, report little taxable income, and then pass appreciated assets to heirs without ever paying full taxes on the gains. His proposal would also raise corporate tax rates back to pre–Trump levels, close offshore loopholes, tighten inheritance rules, and apply a new minimum tax to anyone with a net worth above $100 million.^[5]

On top of that, Newsom wants Washington to create a national “public equity” fund that would hold large stakes in artificial intelligence companies and the wider AI economy.^[8] He says “every American should own a piece” of AI, and wants revenue from this fund and his tax hikes to pay for severance, retraining, and portable benefits for workers displaced by technology, as well as universal child care, tuition-free college, and more healthcare spending.^[6] In effect, his plan would lock in a permanent federal claim on future AI profits and expand long-term entitlement-style programs, all managed from Washington.

Why Conservatives See a Bigger Threat in the AI Fund

For many conservatives, the most alarming part of Newsom’s agenda is not just higher taxes, but Washington’s push to own “a major stake in the new economy.”^[5] When the federal government becomes an equity partner in key industries, it gains leverage over speech, innovation, and political dissent. Tying AI profits to federal programs like universal child care and free college risks turning every AI policy debate into a fight over protecting government revenue, not protecting freedom and competition. That raises real concerns about censorship, surveillance, and cronyism in a sector that will shape the economy and national security.

California Gov. Gavin Newsom proposes federal billionaire tax and AI "public equity" fund https://t.co/gcEyi4eZyV

— The Right News, Right Now. (@BradPorcellato) June 26, 2026

Conservatives also warn that these plans ignore basic fiscal discipline. Decades of big-government promises have produced trillions in debt, inflation, and higher living costs for families. Now, rather than cutting waste or devolving power back to states, Newsom wants to stack new federal taxes, expand federal control over cutting-edge tech, and funnel the proceeds into a familiar wish list of social programs. Voters who are already paying more for gas, groceries, and housing may not be eager to trust Washington with even more of their paycheck and the future of the AI economy.