Another of my past predictions comes true: Now cometh the wealth tax.

Back in this post I wrote, "...once the middle-upper middle class need to be targeted in order to transfer wealth to the starving lower classes in order to buy votes, it will begin with those who have assets that are on the books.  If you have a nice retirement fund with stocks and bonds OR real estate, the wealth tax is coming for you.  They will want a percentage of your existing wealth each year even if you are no longer working.  They will want a percentage of paper gains before they are even realized and if after paying the paper gain tax the assets fall in value there will be no rebate.  So the notion of long term investing will be out the window because government will win if your unrealized gains go up but you will take the hit by yourself when they come back down."


Today's headlines again prove my world view to be correct as California floats a bill for consideration into law that would tax the global wealth of Californians.  The last time I saw something like this go down was the so called unitary tax that Florida stupidly tried to levy against IBM in Boca Raton.  The state told IBM that its state taxes would be levied against its global revenues.  IBM complained to the state that it was unfair and threatened to leave if it was not repealed but Florida saw IBM making money hand over fist on their personal computers which were being built in the state (partially by me!).  This arrogance on the part of Florida caused IBM to immediately plan to move out of the state.  The state watched IBM move in that direction for 3 months but did not change its mind.  But IBM then began laying off its Florida workforce and the assholes in government got scared.  So they offered to repeal it but it was just too damned late.  IBM flipped them the bird and moved its manufacturing operations to RTP in North Carolina.  In very short order, 13000 highly paid engineers left the state, me included.

California is trying to learn from Florida's mistake.  Their response: "the tax would also be imposed on former residents who left within the past decade, presumably to catch those who fled the state’s income tax rates, which already are the highest in the country.”.  While this has got to be completely illegal, it is important to note that they are running it up the flagpole.  They are serious and so they are starting with this outrageous proposal with the idea of negotiating it back a bit.  But make no mistake, if you own a business in California that is worth, say $10 million which just barely breaks even after expenses, California is going to slap you with another $40k in tax "just because".   And if you don't have it well then I guess you better just sell the business because greedy corrupt government IS going to get its share of YOUR money.

The whole thing is corrupt as Hell but California keeps electing these liberal pukes like there is never going to be a day of reckoning.  Wake up folks, the day of reckoning is here.  As the fake money dies, government will not slim down. It will just find more and more and more ways to tax you.  I say again, GET OUT of California before everyone else does because once the first 5-10% leave the housing prices will collapse because nobody in their right mind is moving there.  Wait until Google and Facebook and everyone else start threatening to move their HQ out.  That is where the rubber will meet the road.