California Governor Proposes Public Equity Fund Tied to Billionaire Tax and AI
California Governor Gavin Newsom has introduced the idea of establishing a “public equity” fund that would utilize a federal tax on billionaires, alongside advancements in artificial intelligence. In a recent Substack post, he discussed his economic strategy, advocating for a national minimum tax applicable to billionaires and proposing a federal fund aimed at ensuring that every American has a stake in the future shaped by AI.
“I support a tax on the wealthiest Americans,” Newsom stated, referring to this concept as the modern iteration of the Buffett Rule. This rule aims to ensure that the ultra-wealthy contribute at least as much in taxes as their employees do.
He also expressed his concern regarding the upcoming wealth tax on California’s November ballot, stating, “I will vote no.” His opposition stems from his belief that taxation of affluent individuals should be managed at the federal level instead of through state initiatives.
“The battle for taxing the richest Americans should not be a state-by-state struggle,” he emphasized. “This is a federal issue, which has led to the current flawed system.”
Newsom pointed out an inequality in the tax system, where sometimes corporate employees end up paying higher tax rates than their heirs. He illustrated this by noting that construction workers could pay more in taxes compared to developers, while delivery drivers might face higher tax rates than the founders of the companies they work for.
He criticized a system created by “decades of loopholes engineered by lobbyists, with the backing of politicians who know whom they represent.” Newsom also claimed that the loophole allowing for “tax-exempt living loans” should be eliminated, as it predominantly benefits the extremely wealthy.
He argued for rewriting inheritance laws, highlighting that in the next two decades, the country will witness the largest transfer of wealth in history, with around $124 trillion switching hands. He stressed that federal tax law, corporate legislation, and inheritance regulations hinder a broad coalition of American workers, both blue-collar and white-collar, urban and rural.
Shifting the focus to artificial intelligence, Newsom proposed the establishment of an AI “equity” fund, stating, “It’s apparent we are on the brink of a new economic paradigm.” He raised concerns about who will reap the benefits of the growth created by automation and insisted that all Americans need to share in the prosperity that AI promises through a national equity fund.
Newsom framed his proposals as a “once-in-a-century opportunity to rejuvenate the American Dream,” envisioning funding for universal child care, free higher education and job training, health care support, and a fresh industrial policy targeting the AI age.
Additionally, he expressed a desire to reinstate the corporate tax rate from before the 2017 Trump tax cuts and eliminate loopholes that let multinational companies shift profits overseas. Newsom criticized “trickle-down economics” as a failed strategy that has existed for nearly 50 years, arguing it leads to profits going into buybacks and executive pay, all while real wages for workers have flatlined.
A recent commentator has suggested that Democrats may leverage similar rhetoric to fuel fears about job losses attributed to AI as the 2026 midterm elections approach, predicting an influx of messages aimed at increasing public anxiety over these issues.
