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California’s looming capital flight problem could reshape state in 3 key areas

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California’s potential «billionaire tax» is the latest catalyst that is driving a capital exodus that puts the state’s tax base, budget and political power at risk.

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The measure would levy a one-time 5% wealth tax on residents with more than $1 billion in assets, including unrealized gains — a proposal California Gov. Gavin Newsom has warned could backfire.

Supporters say the tax would close budget gaps, while economists warn that it could weaken long-term revenue.

TAX FIGHT PUTS CALIFORNIA ON COLLISION COURSE AS BILLIONAIRES LEAVE FOR RED STATES

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Economists argue the risks are already materializing. Here are three ways that California’s capital exodus will reshape the state.

1. Forcing out the ultra-wealthy deals a major blow to the tax base

California Gov. Gavin Newsom has previously said that he does not support the «billionaire tax» measure. (Wally Skalij/Los Angeles Times/Getty Images)

Wayne Winegarden, a senior fellow in business and economics at the Pacific Research Institute, warned that the departure of even a few ultra-wealthy taxpayers can have lasting consequences.

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«When one of those individuals leaves, that’s a significant and recurring hit to the tax base,» Winegarden told Fox News Digital.

E.J. Antoni, chief economist at the Heritage Foundation, said the proposed wealth tax «has literally never worked anywhere,» warning that capital flight erodes the tax base and shifts the burden onto those who remain.

«The tax base is collapsing, there’s no other way to put it,» Antoni said.

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CALIFORNIA WEALTH TAX PROPOSAL HEMORRHAGES $1T AS BILLIONAIRES FLEE

Texas has emerged as a clear winner in the shift toward lower-tax, less-regulated red states, while blue-state leaders grapple with the fiscal and political consequences of capital flight.

Between 2012 and 2022, California recorded a net loss of more than 361,000 residents to Texas, a shift that carried roughly $21 billion in taxable income with it. 

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Megan Mauro, interim president and CEO of the Texas Association of Business, said the Lone Star State has seen a surge of new residents from California.

«We have a light regulatory touch and no personal or corporate income tax,» Mauro said, citing Texas’ recent $25 billion surplus as evidence of a different fiscal approach.

She warned the billionaire tax could leave California with fewer taxpayers and less revenue over time.

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2. Capital flight pushes budgets in the wrong direction

A view of the California State Capitol on August 19, 2025 in Sacramento, California.

A smaller state budget could limit funding for public services and increase pressure on remaining taxpayers. (Justin Sullivan/Getty Images)

When it comes to California’s budget, the stakes are especially high.

A relatively small group of top earners supplies a disproportionate share of state income tax revenue, meaning departures at the top can quickly translate into budget shortfalls.

«You’re going to have less revenue,» Winegarden said, warning that slower revenue growth makes it increasingly difficult for states to finance their agenda.

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As high-income taxpayers leave, spending pressures don’t necessarily ease, he said, warning that the state will have a hard time financing things like Medi-Cal, California’s Medicaid program. 

3. Population loss could mean fewer congressional seats

House of Representatives chamber

States with shrinking populations risk losing congressional representation, while expanding states gain influence. (J. Scott Applewhite/File/AP Images)

Analysts say the migration could reshape political power, affecting congressional representation and federal funding. States that lose population risk fewer seats in Congress, while faster-growing states can gain seats. 

Shifts in population also influence how federal dollars for transportation, health care and education are allocated, since many funding formulas are tied to population size.

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«I think you absolutely get to a point where people are willing to vote differently,» Winegarden said. 

More broadly, Antoni said California could serve as a warning for other states weighing similar policies. 

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«California’s decline was not written in stone. It did not have to be this way,» he said. 

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Donald Trump afirmó que el nuevo líder supremo iraní Mojtaba Khamenei “probablemente está vivo, pero dañado”

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El presidente de Estados Unidos, Donald Trump, habla durante un evento del Mes de la Historia de la Mujer en la Sala Este de la Casa Blanca en Washington, DC., EEUU, el 12 de marzo de 2026 (REUTERS/Evan Vucci)

El presidente de Estados Unidos, Donald Trump, afirmó que considera probable que el nuevo líder supremo de Irán, Mojtaba Khamenei, siga con vida, aunque sugirió que podría haber sufrido algún tipo de daño.

En una entrevista con Fox News Radio, Trump fue consultado sobre la situación del dirigente iraní tras su reciente nombramiento. El mandatario respondió que, en su opinión, Khamenei probablemente continúa con vida, pero cree que podría estar afectado físicamente.

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Creo que está dañado, pero probablemente está vivo de alguna forma”, aseguró el inquilino de la Casa Blanca.

Por otra parte, reivindicó la ofensiva conjunta de Estados Unidos e Israel contra Irán como el cumplimiento de una obligación postergada durante casi cinco décadas por administraciones pasadas.

Durante un acto en la Casa Blanca por el Mes de la Historia de la Mujer, Trump afirmó que la campaña avanza “muy rápidamente”, calificó a Irán como una “nación de terror y odio” y sostuvo que el ejército estadounidense está “haciendo lo que hay que hacer, lo que se debería haber hecho durante 47 años”.

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El nuevo líder supremo de
El nuevo líder supremo de Irán, Mojtaba Khamenei, segundo hijo del difunto líder supremo de Irán, Ali Khamenei (REUTERS/Foto de archivo)

“Realmente son una nación de terror y odio, y están pagando un gran precio en este momento”, insistió en sus declaraciones, expresadas en el día 13 de la operación «Furia Épica“.

Trump emitió en los últimos días mensajes contradictorios sobre el desarrollo de la guerra, al afirmar por momentos que Estados Unidos e Israel “ganaron” frente a Irán y sugiriendo que el conflicto podría terminar “muy pronto”, y en ocasiones que aún existe la necesidad de continuar la lucha para acabar con el régimen.

Trump no respondió directamente a los comentarios del nuevo líder supremo iraní, Mojtaba Khamenei, quien en su primer mensaje tras asumir el cargo prometió venganza y defendió que Irán debe mantener el control del Estrecho de Ormuz.

El aumento de la tensión en la región ha disparado los precios mundiales del petróleo, en medio de la virtual paralización del tráfico de petroleros por esa vía clave. No obstante, Trump afirmó en redes sociales el jueves por la mañana que considera prioritario impedir que el “imperio del mal” de Irán acceda a armas nucleares.

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En sintonía con los desafíos regionales que surgen de la escalada en Medio Oriente, el secretario del Tesoro de Estados Unidos, Scott Bessent, anunció que la Marina estadounidense, posiblemente junto a una coalición internacional, escoltará buques a través del Estrecho de Ormuz tan pronto como las condiciones militares lo permitan.

El secretario del Tesoro de
El secretario del Tesoro de Estados Unidos, Scott Bessent (REUTERS/Jonathan Ernst)

En declaraciones a Sky News, Bessent confirmó por primera vez que Washington contempla operaciones de escolta naval para reabrir este paso estratégico, por donde circula aproximadamente el 20% del petróleo mundial.

“Mi convicción es que, en cuanto sea militarmente posible, la Marina de Estados Unidos, quizás con una coalición internacional, estará escoltando buques”, afirmó Bessent y detalló que el operativo comenzará cuando Estados Unidos logre “el control total del espacio aéreo” y las “capacidades de reposición de misiles de Irán estén completamente degradadas”.

El funcionario añadió que petroleros iraníes y de bandera china han transitado la zona en días recientes, lo que, a su juicio, descarta que Irán haya minado el estrecho.

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Tras el inicio de la Operación Furia Épica el 28 de febrero —una ofensiva coordinada de Estados Unidos e Israel contra instalaciones militares, nucleares y de liderazgo iraní, que resultó en la muerte del líder supremo Alí Khamenei— el tráfico comercial por el estrecho se redujo prácticamente a cero.

Según la Agencia Internacional de Energía (AIE), el flujo de crudo cayó de unos 20 millones de barriles diarios a una mínima fracción, obligando a los países del Golfo a recortar su producción en al menos diez millones de barriles diarios. El precio del Brent llegó a rozar los 120 dólares por barril.

(Con información de AFP)

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Transgender triple killer removed from home with 2 foster children months after authorities were notified

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Two foster children who had been living with a convicted transgender triple killer, despite authorities being aware of the situation since late December 2025, are no longer residing with the violent criminal, according to local media reports.

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Reginald Arthurell — who began transitioning to a woman shortly after his release from prison in 2020 — was removed from the home after heavily armed officers raided the address on Monday, radio station 2GB reported. He had been living with a 12-year-old and a 14-year-old for several months, the outlet said. 

The minister for Families and Communities of New South Wales (NSW) on Tuesday issued an apology, saying the situation «should never have been allowed.»  

«It is entirely unacceptable for a vulnerable child in the care of the state to be living with a triple murderer,» Kate Washington told 2GB. «It should never have happened and I’m deeply apologetic for what has happened.»

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VIOLENT REPEAT OFFENDER ACCUSED OF KILLING TEACHER AS 911 CALL REVEALED HER FINAL MOMENTS: REPORT

Reginald Arthurell began transitioning into a woman after 2020 in Australia. (Obtained by the NY Post)

She added that «very poor decisions were made» at the time when authorities became aware of the situation and said a review is underway to determine how the «terrible» circumstances were allowed to happen, promising systemic changes.

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The situation has sparked widespread backlash and calls for the resignation of authorities who allowed the crisis to continue for months. 

Late last year, Arthurell moved into an existing foster home in Sydney, where two children were already living under the care of an elderly woman, 2GB reported. He reportedly met her while she was working at a hospital, and he was a patient there.

The woman, who invited him to move in as a housemate, already had two foster children living with her under her approved placement with the New South Wales Department of Communities and Justice.

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Arthurell therefore shared the household with the children. The arrangement went unnoticed by authorities until the carer’s daughter reportedly raised concerns late last year.

FLORIDA MAN WHO WRESTLED COP’S GUN AWAY AND KILLED HIM TO BE EXECUTED AFTER FINAL APPEALS REJECTED

Reginald Arthurell wearing a blong and black wig with lipstick on in two split photos

Reginald Arthurell is a three-time convicted murderer in Sydney, Australia.  (Obtained by the NY Post)

Prior to moving in, Arthurell had built a long criminal history, primarily involving the killings of three people over three decades, court documents show. He was first convicted of manslaughter in 1974 for reportedly stabbing his stepfather to death in Sydney. In 1981, he fatally bashed a 19-year-old sailor during a violent robbery, and while on parole in 1995, he killed his fiancée by beating her to death with a piece of wood, local outlets reported.

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After killing his romantic partner, he was caught photographing himself wearing one of her dresses, 2GB added.

All three killings involved alcohol, court documents show. Records indicate that Arthurell spent nearly 39 years of his life in custody following the murders.

After his prison release in November 2020, Arthurell began transitioning into a woman under the name Regina. The first public photos and self-introductions appeared on a transgender community Facebook page in May 2021, 2GB reported. Arthurell had also expressed plans to undergo gender-affirming surgery «as soon as possible,» News.com.au reported.

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Reginald Arthurell wearing a long curly brown wig

Reginald Arthurell was removed from a home that housed two foster children following a raid by armed police officers.  (Obtained by the NY Post)

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Court documents also described that «her transition has been taking place over quite some years,» confirming the process was ongoing after his release.

Arthurell now remains in private accommodation following his Monday removal, ABC Australia reported Tuesday. 

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Mamdani touts landmark court victory against repeat offender landlord in housing enforcement push

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New York City Mayor Zohran Mamdani on Thursday touted a Bronx Supreme Court judgment he said has already topped $2.1 million against Bronx landlord Seth Miller, portraying the case as a new template for City Hall to squeeze owners who don’t fix violations.

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Speaking at Bronx Borough Hall, Mamdani said the court found that «years of uncorrected code violations at 919 Prospect Avenue constitute a public nuisance,» and ordered penalties of «$1,000 a day» for violations dating back to April 21, 2019, «totaling more than $2.1 million so far,» with «fines continuing to accrue» if repairs are not made.

«Since your landlord, a repeat offender on New York City’s annual Worst Landlord Watch List, purchased the property in 2011, your tenants have faced an unending stream of violations that have taken a toll on their health, safety and well-being,» he said. «We are speaking of infestations of, mice, rats and cockroaches; leaking pipes; collapsed ceilings; black mold; and lead paint. The list of abuses and failures, frankly, goes on.»

«This is a landmark victory,» he said, saying it was «the first time that the court has levied the maximum civil penalties allowed on a landlord under the Nuisance Abatement Law.»

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IS MAMDANI’S SOCIALIST PUSH FOR RENT CONTROLS ABOUT TO WRECK THE NEW YORK CITY HOUSING MARKET?

New York City Mayor Zohran Mamdani speaks at a «Rental Ripoff» hearing at Fordham University in the Bronx borough of New York on March 11, 2026. (Spencer Platt/Getty Images)

He also warned other owners: «If you do not change your ways, we now have a strong precedent to pursue the same kind of legal action against you.»

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Mamdani’s corporation counsel, Steven Banks, declined to spell out how the city would force compliance if the landlord attempts bankruptcy tactics.

«There are multiple ways forward. I’ve always learned [that] when dealing with somebody like this particular landlord, it’s best not to telegraph exactly what we’re going to do,» Banks said. «But rest assured: we will be ready.»

The mayor said the city has «allocated more than $85 million in our preliminary budget to add 200 new attorneys and 100 support staff to our Law Department,» arguing the goal is compliance, not revenue.

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People attend a rally before a "Rental Ripoff" hearing at Fordham University in the Bronx

People attend a rally before a «Rental Ripoff» hearing at Fordham University in the Bronx borough of New York on March 11, 2026, in New York City.  (Spencer Platt/Getty Images)

The push escalates Mamdani’s day-one posture that targeted landlords and promised aggressive legal intervention.

On Jan. 1 at his inauguration, Mamdani vowed, «We will make sure that 311 violations are resolved.»

«Today is the start of a new era for New York City,» Mamdani said. «It is inauguration day. It is also the day that the rent is due.»

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HOURS AFTER TAKING OFFICE, NYC MAYOR MAMDANI TARGETS LANDLORDS, MOVES TO INTERVENE IN PRIVATE BANKRUPTCY CASE

Zohran Mamdani

New York City Mayor Zohran Mamdani speaks at a «Rental Ripoff» hearing at Fordham University in the Bronx borough of New York on March 11, 2026, in New York City. (Spencer Platt/Getty Images)

During his day one action plan, Mamdani announced an executive order creating a LIFT task force, or a land-inventory effort designed to leverage city-owned land and accelerate housing development. He said the task force will review city-owned properties and identify sites suitable for housing development no later than July 1.

He also announced the SPEED task force, which Mamdani said stands for Streamlining Procedures to Expedite Equitable Development. He said the task force will work to remove permitting barriers that slow housing construction. 

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Both task forces will be overseen by Deputy Mayor for Housing and Planning Lila Joseph, he said.

«These are sweeping measures, but it is just the beginning of a comprehensive effort to champion the cause of tenants,» Mamdani said.

WATCH:

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Landlord groups have attacked Mamdani’s tenant-protection chief, Cea Weaver, a longtime housing activist and member of the Democratic Socialists of America (DSA), over past comments linking homeownership to «White supremacy,» calling them «racist» and evidence of hostility to property owners.

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Speaking about housing policy and equity in a March 2021 DSA video, Weaver said, «For centuries, we’ve really treated property as an individualized good and not a collective good, and we are going to … in transitioning to treating it as a collective good and towards a model of shared equity, will require that we think about it differently.»

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«Families, especially White families, but some POC families who are homeowners as well, are going to have a different relationship to property than the one that we currently have,» she added.

Fox News Digital’s Nikolas Lanum and Jasmine Baehr contributed to this report.

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