Silicon Valley Mobilizes to Shape California Governor's Race and Wealth Tax Battle

Tech industry flexes financial muscle to influence state politics and policies

Published on Feb. 21, 2026

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Silicon Valley's immense wealth and influence have become crucial to California's economy and budget, but the tech industry has historically paid little attention to state government. That is now changing rapidly as the industry seeks to elect a tech-friendly governor and fight proposed taxes on corporations and the wealthy.

Why it matters

The tech industry's growing political involvement could have major implications for California's economic and fiscal policies, as well as the state's overall political landscape. Silicon Valley's ability to fund campaigns and lobby for its interests could shift the balance of power in Sacramento.

The details

Billionaire investor Tom Steyer is making a bid for the Democratic gubernatorial nomination by endorsing efforts to raise taxes on corporations and the wealthy, including a proposed wealth tax that has already prompted some tech billionaires to relocate to low-tax states. Meanwhile, San Jose Mayor Matt Mahan is counting on Silicon Valley to bankroll his campaign, positioning himself as the industry's preferred candidate by opposing new taxes. The tech industry's political engagement is being driven by concerns over potential regulations on artificial intelligence and other emerging technologies, as well as a perceived shift in the California Democratic Party toward more progressive policies.

  • Gavin Newsom, the current governor who has generally backed Silicon Valley, will be leaving office in a year.
  • In 2020, voters rejected a 'split roll' measure that would have allowed increases in commercial property taxes, but the issue remains a priority for public employee unions and other left-leaning groups.

The players

Tom Steyer

A billionaire investor making a bid for the Democratic gubernatorial nomination by endorsing tax increases on corporations and the wealthy.

Matt Mahan

The San Jose mayor who is positioning himself as the tech industry's preferred candidate for governor by opposing new taxes and aligning himself with Silicon Valley's interests.

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What they’re saying

“We really can't wait. We're on the clock. And so, yes, the only way to pass that is with a special election.”

— Tom Steyer (Politico)

“That's the wrong approach.”

— Matt Mahan, San Jose Mayor (N/A)

What’s next

The gubernatorial race and the battle over the proposed wealth tax will likely be key political battlegrounds in California over the next year, with the tech industry playing a major role in shaping the outcome.

The takeaway

Silicon Valley's growing political involvement could reshape California's economic and fiscal policies, as the tech industry seeks to elect a governor and fight proposed taxes that could impact its vast wealth and influence.