[quote=SK in CV]
1st, it was a subsidy for all debt when all interest was deductible. The remaining deductions for mortgage and other interest is still a subsidy. (The argument used in the mid-80’s when the elimination of the personal interest deduction was proposed is that it was a subsidy for borrowers who went into debt.)
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It is a subsidy if we agree that any money not confiscated by the government is a subsidy to those who got to keep it.
Interest was never taxed until 1986. I was not here in 1986 when some of the interest was made taxable, but I believe you when you say that politicians framed the tax increase as an issue of fairness. That’s my only point – taxing something that has been going on since the invention of natural exchange and was never ever taxed might be ‘good’ policy and required, but it should not be presented as stopping a giveaway.
[quote=SK in CV]
2nd, your argument would seem to support never reducing government entitlements or expenditures. So social security can never be reduced, medicaid cutbacks are out of the question, the Earned Income Credit must be permanent, reduction of college education funding should have been opposed, and eliminations of government employee retirement plans is yet again, the government taking something away. Is that really the argument you want to make?[/quote]
No. My argument is that the interest deduction is not an expenditure, that’s all.
Incidentally, you picked items that I have no problems with – I don’t think any of the listed should be reduced. But that can’t be inferred from my premises.
