Ahead of the 2026 elections, a swath of Democrats in office and on the campaign trail are trying to curry favor with voters by calling for wealth taxes to fund a list of progressive policies, from dental and vision health insurance to universal child care. The most notable proposal, a ballot measure in California with potential retroactive enforcement, has already sparked a mass exodus of billionaire residents from the Golden State.

But targeting America’s 1% to provide greater social services could come with adverse effects on the United States’s robust nonprofit sector. After all, policies often have unintended consequences.