What sounds good at first can unleash a cascade of unexpected and undesirable effects. In 1696, Britain’s King William III started taxing buildings on the basis of their number of windows, an early attempt at progressive taxation. But the levy, which lasted 155 years, prompted landlords to block up tenement windows, robbing the poor of light and ventilation. In 1990 a luxury tax on purchases of boats, private jets, high-priced cars and expensive jewelry seemed like a nice way to narrow the US budget deficit—until it devastated the American yacht industry, put tens of thousands out of work and was quickly repealed.