Senior Research Fellow at the Mercatus Center at George Mason University
Arlington, VA
Joined February 2009
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Veronique de Rugy retweeted
Amazing that a person who has produced so many estimates doesn’t even know how budget scoring works.
@joshrauh is right here, and @gabriel_zucman once again wrong.
See for example scores of repatriation holidays.
Now, the crucial flaw is that Jaros and @joshrauh simply ignore this.
They assume that billionaires will leave permanently, frightened by the prospects of an annual wealth tax.
But they just count the revenue from the one-time wealth tax. Not the revenue from the annual tax.
The annual tax that triggered the “exodus” Jaros and @joshrauh imagine never materializes.
The billionaires upended their lives for nothing.
Veronique de Rugy retweeted
Professor Zucman is not an American lawyer so his mistake on this post is thinking the retroactive one-day snapshot date will survive constitutional challenge. It won't.
Retroactive tax changes have survived legal scrutiny in some limited circumstances in the past, but courts frown much more heavily on retroactive enforcement of a “wholly new tax.” The California wealth tax would be “wholly new” not just to the state, but to the country, making this a fairly cut-and-dry case of unconstitutional retroactivity.
The ballot initiative itself even has a provision to rewrite the effective date if/when a judge strikes it down.
Because most people in the know realize this, it absolutely makes sense for the billionaires to move out, just based on this one thing regardless of one's predictions of future California legislation.
Crucially, moving to another state doesn’t allow one to avoid the tax, since the tax would be owed by billionaires who lived in California at the beginning of 2026.
Not 2027 — but beginning of 2026.
There is no incentive to move to another state. One cannot avoid the tax by moving. This is one of the main reasons why it was structured as a one-time tax.
Veronique de Rugy retweeted
It's funny because Zucman's frequent co-author Emmanuel Saez has a great paper in the AER showing that high-income taxpayers move around a lot when you have free migration (such as for Euro soccer leagues). Yes, it's for a permanent income tax, rather than a "temporary" wealth tax, but they are clearly responding to tax rates
Veronique de Rugy retweeted
Gabriel Zucman @gabriel_zucman has now for the third time criticized our research on California’s proposed billionaire tax, claiming we have provided “no answer” to his criticisms.
xitter.cf/gabriel_zucman/status/…
We have actually already responded twice on this platform, but let’s address his arguments once more in detail, with the hope that third time’s the charm. 1/14
This Hoover Institution study, which has fueled the deluge of ads (more than $200 million spent by billionaires so far) to defeat the California billionaire tax, is spectacularly misleading.
Let me explain its crucial flaw. 🧵
Readers added context they thought people might want to know
Zucman argues that the tax will raise his projected revenue because billionaires who leave CA after 1/1/26 will be taxed anyway.
At least $542B of net worth (Page, Brin, Thiel) departed the state by 12/31/25.
The entire thread is a misleading denial of this fact.
ft.com/content/d66976…
nytimes.com/2026/04/27/us/…
forbes.com/sites/forbeswe…
Veronique de Rugy retweeted
The key reason is this:
People who did not fall off the turnip truck yesterday know the truth about "one time" taxes. Especially this one that spends the money on recurring programs instead of one time expenses.
My source for CA prop 40 leading to a permanent tax? Prof. Zucman:
The key problem is this:
Why would billionaires permanently leave California in response to a one-time tax owed if they lived there on January 1, 2026?
It would only make sense for them to leave if the tax becomes annual.
But if the tax becomes annual, it would also generate revenue annually — by virtue of, well, being annual.
Veronique de Rugy retweeted
Very good explanation from one of the smartest French economists of why Mélenchon can cancel all French sovereign debt that was outstanding as of July 1st this year without any negative consequences, as long as he promises it’s a one-time default.
Let’s be clear: this is a highly inappropriate way to model the effect of Prop 40 on taxpayer behavior.
For one, it’s a basic violation of rational expectations, a cornerstone of modern economics.
In Jaros and @joshrauh world, the billionaires act irrationally: they respond to a policy that does not exist and will never exist.
Economics students around the world are taught this is not an appropriate way to model behavior — but apparently in this context (fighting Prop 40) it’s OK.
Veronique de Rugy retweeted
Amid the gloomy predictions about the future of reading, @joeljmiller continues to offer welcome perspective. From James Daunt’s revival of Barnes & Noble to small independent publishers, there’s plenty of reason for optimism.
And then there’s Jane Eyre: required reading in China, restricted in four Texas school districts.
Bookish Diversions: Books Are Alive and Well
The Man Behind B&N’s Comeback, Paperbacks, Hermit Crab Press, ‘The Last Upheaval,’ ‘Jane Eyre’ in China—but not Texas
open.substack.com/pub/miller…
Veronique de Rugy retweeted
You can quarrel with the assumptions. But working with estimates from the literature is a better approach than "We just assumed the loss to moving/structuring/reduced effort would be only 10 percent", which I think is already unrealistic given the known departures.
California's Billionaire Tax Act would collect roughly $30 billion. Accounting for lost income taxes from departures, the mean Net Present Value is negative $39 billion, from Benjamin Jaros and Joshua Rauh nber.org/papers/w35899
Veronique de Rugy retweeted
1. This claim is downright false. The top 0.001% paid an avg effective tax rate in the high 30s in recent years
2. Zucman's published stats from 2018 confirmed this. Then he manipulated how he calculates them to fit his story. I caught him red handed.
xitter.cf/gabriel_zucman/status/…
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Veronique de Rugy retweeted
Calestous Juma’s book Innovation and Its Enemies turns 10 this year. I want to once again encourage everyone to give it a read. It is an absolute masterpiece. Sadly, Professor Juma passed away shortly after its publication, but his legacy lives on in this wonderful text.
Veronique de Rugy retweeted
California's Billionaire Tax Act would collect roughly $30 billion. Accounting for lost income taxes from departures, the mean Net Present Value is negative $39 billion, from Benjamin Jaros and Joshua Rauh nber.org/papers/w35899
Veronique de Rugy retweeted
Americans across the political spectrum are refusing to face adult financial realities. From the left demanding massive social spending without European-style taxes, to the right demanding tax cuts while ignoring major deficit drivers, everyone wants the reward without the responsibility.
wsj.com/opinion/free-express…
Veronique de Rugy retweeted
I learned more from this @EconTalker episode about demographics than you would think possible in an hour.
Listen in for what you should- and shouldn't- be worried about with respsect to fetility rates.
econtalk.org/the-great-ferti…
Veronique de Rugy retweeted
"the shipbuilding ecosystem, which we totally screwed up with that stupid Jones Act" – at Washington, DC
Jamie Dimon, Chairman & CEO, JPMorgan Chase & Co., is about to address #EconClubChi. Watch the live program here: youtube.com/live/UkvigLsQ2Ic…
Veronique de Rugy retweeted
Sans même tenir compte des dégradations matérielles, ce weekend aura coûté au contribuable français environ 3 milliards *par an*, à perpétuité, en intérêts supplémentaires sur la dette (11bp de spread).
L'équivalent du salaire d'environ 60 000 profs de lycée supplémentaires.
Veronique de Rugy retweeted
Shareholders of UAL are by definition possible targets of a wealth tax, as they have financial assets. If the CEO wants to expropriate shareholders, shouldn't they pressure the board (⬇️) to replace him? Why should a person support a CEO who wants the gvt to seize their assets?
What about passenger inequality. Is it unjust that some people can afford $12,000 for a round trip ticket in Polaris with steak and champagne but others pay deep discount economy without seat selection and fly in a middle seat in the back next to the toilet?
Veronique de Rugy retweeted
From @veroderugy: The federal government just closed fiscal year 2026 with a deficit of nearly $2 trillion, according to figures the Congressional Budget Office released last Thursday
Read more ⬇️
nysun.com/article/what-excus…
Veronique de Rugy retweeted
Spending on core state functions (net of pension contributions) in France compared to peers. To compute these shares, I removed the State’s imputed pension contributions for teachers, soldiers and other civil servants from each function and from total spending-- gives a better sense of what the government spends on teaching kids and keeping the country safe.
thetwocents.substack.com/p/t…
French students complain that France doesn't spend enough on education. Well, it does: $13,787 per pupil per year, 1.4% more than the OECD average, and more than countries like 🇰🇷🇩🇪🇦🇺🇨🇭🇪🇸🇨🇦🇮🇹
But 32% of that money doesn't go to education, but to pensions!