As Twitchy readers know, Mark Cuban and Ro Khanna have had some 'tiffs' in the past about money, taxes, capitalism, etc.. Basically, the billionaire knows more about capitalism, taxes, and making money than the communist.
Speaking of crazy, this wealth tax in California that Bernie Sanders supports from Khanna is a disaster.
The California Democratic Party and the California labor movement just stood with @BernieSanders and me in supporting 5% wealth tax on 250 California billionaires.California voters want a Democratic Party that will stand up for the working class over the billionaire class. pic.twitter.com/QrLZUh3bS6
Ro, I like you. You know that. But you need to read the state of the state.The number of Deca Unicorns in Cali is growing by the day as investors chase amazing startups.A unique feature of these 10b startups is that even if they raise a billion, little, if any of that… https://t.co/l1LRaiki16
… money goes to the founders, who are now worth billions of dollars overnight. They are the definition of cash poor, stock rich
How are you going to tax them? Make them borrow money against their shares, if they can? They just raised money to grow their company and a bank will come along and loan them money? A company that has been in business maybe less than a year? lol
Will you take their stock if they can’t?
Do you really think each of multiple founders, who started an amazing company in Cali and is now a billionaire, can each just pull out $250m per billion of net worth from their raise ? You know they can’t.
If this passes, and it doesn’t directly impact me at all, I won’t be a Cali resident, but you can bet if I’m investing in a multi-billion-dollar startup, I’m asking them to move from California first. IMO, if this passes, only idiot startup founders stay in Cali. I’ve done it before and will do it again. Dallas. Pittsburgh. Indiana.
I will make NOT being in California a prerequisite for an investment.
Why not a non recourse loan for pledged stock as collateral for this situation?
Allow illiquid founders to pledge shares with a loan from the government to pay tax. The loan period is long but not infinite (e.g. 10 years). The loan is non-resource: at the end of the period, the loan is either paid back in cash, or the government assumes the shares.
Ro, that’s insane.You want the state to loan money to the founder, who will then immediately give it back to the state as a wealth tax ?Meaning the state has not received any incremental receipts? What’s the point of that ?Unless of course you want the gov to own shares… https://t.co/wJGaCvVfhE
… (something I thought you criticized) and possibly have control, of companies who underperformed, (or the funding market changed), and couldn’t pay back their loans over those 10 years ? And I’m sure the investors in those companies will be thrilled about their new partners. That will make for interesting board meetings.
“Today’s first topic is trying to figure out how to motivate the founder(s).