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Billionaires spend a record $612 million to fight California’s wealth tax
$612 million has come from more than 70 current and former California billionaires, according to a POLITICO analysis. UK pledges 3% of GDP for defense by 2030, without naming a funding source
Chancellor John Healey told parliament on October 28 that Britain will lift defense spending to 3% of GDP by 2030, to “set the direction” toward a NATO target, according to Politico.
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Transcript
JOHN: Welcome to The Gist. I’m John.
MARY: And I’m Mary. It’s Wednesday, October 28th, 2026. Let’s get you up to speed.
JOHN: We start with The Gist View. Today, it’s all about a massive political bet in California.
MARY: Over 70 billionaires just spent a record 612 million dollars to fight a state wealth tax. Politico ran the numbers. That averages out to under 9 million dollars each.
JOHN: Why spend so much? It comes down to math. The proposed tax is a one-time, 5 percent levy on net worth over one billion dollars. So even the “poorest” billionaire would owe 50 million dollars.
MARY: Spending 9 million to save 50 million is just good business. It’s like buying premium insurance for your fortune.
JOHN: Exactly. The healthcare workers’ union sponsored this tax to fund medical care. They have the voting numbers. The billionaires only have their wallets. Money is their only lever.
MARY: You might wonder, why not just move out of California? Some do. But moving only protects the person who packs up.
JOHN: Right. Defeating the tax at the ballot box protects the whole billionaire class. It stops other states from copying the idea. They are paying to kill the precedent.
MARY: And history backs their play. Back in 1990, the OECD—the international club of rich-world economies—counted 12 member countries with wealth taxes. By 2017, that dropped to just four.
JOHN: Let’s pan out to the Global Overview. AI is now playing central banker.
MARY: Economists Tara Sinclair and Sophia Kazinnik built “Sim Fed.” It’s an AI system. They created AI agents to play the 12 real-life officials who vote on US interest rates.
JOHN: We’re talking about bots named “Sim Powell” and “Sim Cook.” Bloomberg reports these bots predict the Federal Reserve will hold rates steady today.
MARY: The benchmark rate is crucial. It sets the cost of borrowing for everything. Mortgages, company loans, and government debt.
JOHN: Traders pay big money for any edge here. The real test is simple. Can a bot trained on public speeches beat human analysts at predicting the future?
MARY: Speaking of predictions, where is the smart money going? Sarah Ketterer is the CEO of Causeway Capital Management. She told Bloomberg she sees value in defense and French banks.
JOHN: Defense makes sense. Governments are boosting military budgets. Contractors have orders booked for years to come.
MARY: But French banks are a contrarian pick. France has faced recent budget fights and unrest. Investors got spooked. Ketterer thinks that makes their stock cheap right now.
JOHN: Over in the Middle East, the political math just got harder for Benjamin Netanyahu.
MARY: The Wall Street Journal reports his party won the most votes in the latest Israeli elections. But, he lost his parliamentary majority.
JOHN: That changes the power dynamic. To form a government, he needs coalition partners. Those partners will demand a high price. Think cabinet ministries, bigger budgets, or major policy shifts.
MARY: Let’s bring it back home for the European Perspective.
JOHN: In the UK, Chancellor John Healey made a big promise. Britain will boost defense spending to 3 percent of its Gross Domestic Product by 2030. GDP is the measure of the total economy.
MARY: Politico notes this hits a major NATO target. Defense contractors love this. A long-term promise lets them plan new factories and hire workers.
JOHN: But there’s a catch. Healey didn’t say where the money will come from. So, the defense industry gets the certainty. Taxpayers get the suspense of future tax hikes or budget cuts.
MARY: Here in Germany, Berlin is stepping into the future of policing. Next month, 30 AI-powered cameras go live at Kottbusser Tor.
JOHN: The goal is to automatically flag violence or emergencies around the clock. Politico reports it will run as a trial before full operation in December.
MARY: The system isn’t as anonymous as first claimed. The power shift here is clear. Police gain automated eyes. The public gets to find out exactly how much identifiable data the city is keeping.
JOHN: We’re also feeling a pinch at the cash register. The ifo institute just released its price-expectations index.
MARY: That index tracks the share of companies planning to raise prices. It jumped to 22.7 points in September.
JOHN: The ifo’s lead economist expects German inflation to climb past 3 percent soon. Why? Energy. Oil prices spiked after blockades in the Bab al-Mandab strait. Gas and power are hitting their highest prices since late 2022.
MARY: Utilities will likely hike winter bills. So, retailers are passing those costs onto you right now.
JOHN: Meanwhile, the European Union just wrote a big check to Austria. Brussels approved 319 million euros in state aid for a new semiconductor factory.
MARY: Euronews reports this is a strategic move. Public money lowers the cost to build. It also shifts Europe’s microchip production capacity further into Austria, securing a vital resource closer to home.
JOHN: Finally, a non-obvious diplomatic play. Russian Foreign Minister Sergei Lavrov is heading to Atlanta this Friday.
MARY: He’s leading the Russian delegation at the G20 foreign ministers’ meeting. German broadcaster ZDF notes this comes right before new peace talks between Moscow, Kyiv, and Washington.
JOHN: It’s a fascinating move. Russia is using a US-hosted economic summit as a backdoor diplomatic channel.
MARY: That’s the landscape today. We’re seeing big money buy certainty, whether it’s billionaires fighting taxes in California, or defense firms banking on UK promises.
JOHN: Meanwhile, everyday people are testing the limits of AI in Berlin and feeling the squeeze of energy prices at the supermarket. Innovation is moving fast, but the bill is always coming due.
MARY: Thanks for spending part of your day with us. If you found today’s breakdown useful, you can get The Gist delivered free to your inbox every single morning.
JOHN: Just tap the subscribe link in our show notes to join us. No strings attached, just the news you need. We’ll see you tomorrow.
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