On Sunday, California Democrat Party's executive board held a meeting to decide where the party would stand on all of California's ballot propositions. Key among those was the Billionaire Wealth Tax proposal being pushed by the SEIU. And that vote was close. In order to get the party's support, a ballot measure has to get 60 percent of the vote from the executive board. On its first pass, the wealth tax failed.
The pitched and often emotional vote over Proposition 40 exposed deep fissures in the state party over how to respond to growing grassroots anger over wealth inequality. And the endorsement, which narrowly failed to clear the 60% threshold on its first vote, only occurred after two delegates switched sides on a subsequent round.
Delegates and observers erupted into cheers after 61% of the 235 executive board delegates in attendance voted to support Prop. 40.
According to Politico, the outcome of this vote was the result of lots of behind the scenes work by supporters and, partly, by the intervention of eighty-seven-year-old congresswoman Maxine Waters.
Proponents of the wealth tax worked for months behind the scenes before Rep. Maxine Waters walked into a California Democratic Party executive board meeting over the weekend and hoisted in the air one of the deciding votes that helped the party endorse the measure...
Waters’ show of support capped months of organizing ahead of the vote. Backers courted executive board members through mail, gift baskets, emails and mass text messages, then expanded their efforts to party delegates, some of whom served as proxy voters for board members unable to attend the gathering in San Diego, SEIU-UHW Chief of Staff Suzanne Jimenez told Playbook.
Wealth tax backers made a compelling argument, said one member of the party’s executive board who was in attendance supporting the measure: Party members should not “feed into the argument that Democrats are too chickens*** to do anything.”...
A first floor vote barely failed on Sunday, but then Waters walked in to cheers, according to two attendees. On a re-vote, she turned to a room full of around 200 board members and proxy voters with her card in hand. The motion cleared the 60 percent margin it needed by less than two percentage points.
The key to this really does seem to be the argument that the party's base wants to see the rich taxed. Supporters made the argument that failing to back the wealth tax would be like telling the base to take a hike.
Politico notes that the state party board in California is more progressive than the party as a whole. Just because they (barely) endorsed this, doesn't mean it's broadly popular.
Other labor unions and health care organizations, including progressive groups like the California Teachers Association and Planned Parenthood Affiliates of California, object to the tax because it does not provide long-term funding for a range of services, not because they are ideologically opposed to taxing billionaires. They support a different tax on the November ballot: Proposition 3, which would make permanent a temporary income tax hike on high earners.
Willie Pelote, a political consultant working for the No on 40 campaign, called the measure inherently divisive, pitting the interests of health care workers against those of educators and others whose salaries depend on state spending. He said that labor groups should have collaborated to put a measure on the ballot that would have helped all sectors. And he warned delegates that supporting the billionaire tax measure would ultimately deepen rifts in the Democratic Party.
Still, this is a win for the SEIU and gives them a tiny bit of momentum heading into the election. The main opponent of this proposal, Gov. Gavin Newsom, has been remarkably quiet. He seems to mostly be triangulating the issue by supporting a national wealth tax even as he opposes the California measure.
Newsom said the solution is a new national tax policy, rather than a state-by-state system. He proposed a minimum tax on anyone with a net worth above $100 million. He also wants to make it illegal for the wealthy to borrow against their stock portfolios to fund their luxury lifestyles tax free.
Newsom said there should be new rules for inheritance taxes, warning that "the transfer of wealth among the ultra-wealthy will lock in a permanent American aristocracy of inherited wealth." And he wants to raise corporate tax rates to where they were before President Donald Trump's first-term tax cut.
Bernie Sanders is also pushing the national wealth tax. So this is definitely where the party is headed, and not just the DSA members. But if the tax passes in California, other blue states will likely follow their lead and the national tax will be close behind.
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