In a dramatic escalation of political tensions, California Governor Gavin Newsom publicly threatened to withhold billions of dollars in federal tax payments from the US government, deepening a contentious and highly charged dispute with President Donald Trump’s administration. The high-stakes clash centers primarily on immigration enforcement policies, the unprecedented deployment of federal troops in Los Angeles, and longstanding fiscal grievances between California and the federal government.
Newsom forcefully articulated his stance on X, stating, “Californians pay the bills for the federal government. We pay over $80 billion more in taxes than we get back. Maybe it’s time to cut that off.”
This statement references California’s status as a significant net contributor to federal coffers. In 2022, California residents paid approximately $692 billion in federal taxes while receiving roughly $609 billion in federal spending, creating a considerable surplus of around $83 billion.
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Despite this apparent fiscal leverage, Treasury Secretary Scott Bessent reacted sharply to Newsom’s threat. Bessent accused Newsom of promoting criminal tax evasion, emphasizing the seriousness of withholding federal taxes owed by Californians.
“Governor Newsom is threatening to commit criminal tax evasion,” Bessent stated plainly. “His plan would defraud the American taxpayer and leave California residents on the hook for unpaid federal taxes.”
Bessent further urged California’s leaders to emulate Trump-era tax reforms instead of engaging in “reckless” threats.
Immigration enforcement
Newsom’s aggressive fiscal threat was triggered by Trump’s federal immigration enforcement actions in Los Angeles, actions Newsom and other local leaders claim are politically motivated. Beginning June 6, 2025, federal Immigration and Customs Enforcement agents conducted raids in the Los Angeles fashion district, a Home Depot parking lot, and other targeted locations, resulting in over 100 immigrant arrests within a week.
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These operations quickly drew significant backlash from local communities and activists, with large protests erupting throughout Los Angeles. Demonstrators expressed outrage over tactics described by Mayor Karen Bass as “terrorizing immigrant communities” and “sowing fear.”
Trump directed approximately 2,000 federally controlled National Guard troops to deploy in Los Angeles, ostensibly to maintain law and order amid protests and civil unrest over recent immigration raids and deportations.
This deployment, executed without the state government’s consent, was swiftly condemned by Newsom and Bass as a “serious breach of state sovereignty.”
“The federal government is sowing chaos so they can have an excuse to escalate,” Newsom asserted publicly, emphasizing nonviolence and calling on residents to remain peaceful amid heightened tensions.
Newsom even highlighted the irony that Homeland Security Kristi Noem previously criticized the idea of former president Joe Biden federalizing the state’s national guard when she was South Carolina’s governor, a contradiction on the current administration.
The LAPD publicly stated that protests in the city remained largely peaceful, implicitly challenging Trump administration assertions of widespread chaos necessitating federal intervention.
As of this writing, there have been no official reports of fatalities resulting from the protests in Los Angeles. However, numerous injuries have been documented, primarily linked to confrontations between demonstrators and law enforcement using crowd-control methods such as tear gas, rubber bullets, and flash-bang grenades. Several protesters have received medical treatment for minor to moderate injuries, while the LAPD and California Highway Patrol reported injuries to officers caused by projectiles thrown by protesters.
Regardless of the actual situation, Trump has ordered Noem, Defense Secretary Pete Hegseth, and Attorney General Pam Bondi to “take all [actions] necessary” to address the protests in Los Angeles.
Constitutional crisis?
Trump’s unilateral deployment of National Guard troops without California’s consent invokes complex legal debates regarding state versus federal authority.
The White House justified the deployment citing the protection of federal property and personnel under 10 U.S.C. § 12406, which allows such actions without invoking the broader authority of the Insurrection Act. The deployment was done through a Presidential Memorandum, said White House Press Secretary Karoline Leavitt.
This justification, however, remains controversial among legal experts. Former Congressman Adam Kinzinger highlighted critical legal restrictions under the Posse Comitatus Act, explicitly stating, “without the Insurrection Act, the activated Guard troops are now federal army and cannot do law enforcement.” Therefore, while the deployment is legal, federalized National Guard troops are restricted from law enforcement unless an exception applies.
However, some legal analysts clarified that protecting federal facilities does fall within allowed duties under the cited provision, thus setting the stage for ongoing legal battles over the boundaries of federal authority.
Further complicating matters, historical context is pivotal. The National Guard’s federal deployment without state consent is exceedingly rare, previously occurring notably in 1965 during civil rights struggles.
But where everything stands, there could be an identifiable path toward a constitutional crisis, primarily driven by competing claims over state sovereignty versus federal authority. If California acts on Newsom’s threat to withhold billions in federal tax revenue, it would likely trigger immediate legal challenges, potentially forcing unprecedented Supreme Court intervention. Concurrently, the federal government’s deployment of troops without state approval and the contested legality under the Posse Comitatus and Insurrection Acts could result in conflicting court rulings.
And while an outright civil war remains unlikely at this stage, experts warn that persistent escalation—especially through inflammatory political rhetoric, unchecked federal troop deployments, or violent clashes intensifying beyond law enforcement capabilities—could theoretically lead down a dangerous path.
Speaking to reporters as he prepared to board Air Force One in Morristown, New Jersey, on Sunday, Trump asserted that there were “violent people” in Los Angeles who “aren’t going to get away with it.” When questioned about potential plans to deploy additional US troops to Los Angeles, Trump responded decisively, “We’re going to have troops everywhere. We won’t allow our country to be torn apart the way it was under Biden.” He did not provide further details.
Information for this story was found via AP News and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
