Reply #8: These are really bad deductions - they should be gone

[dcfirefighter]

seriously. After returning the top bracket tax cuts, but they should be gone nonetheless.

The mortgage interest deduction is a de facto tax on renters. Renters don't get to take it, ergo they must pay more than non-renters. The subset of the population that rents is poorer than the subset that owns. It's a regressive deduction. Perhaps better than eliminating it, it should be reduced from two houses & $1 million to one house and half a million, but that is merely a matter of degree.

Furthermore, all of the 'homeownership' tax deductions are really and truly a means of transferring wealth from workers to landowners. As we have seen, easy access to money (low interest rates) doesn't necessarily make homeownership more affordable, it makes property more expensive. As soon as most people can afford a more expensive house, house prices rise.

More explicitly, land prices rise. You can still commission construction at $125-$250 a square foot. It's buying that lot that gets more expensive - and there is no feedback loop. If construction costs rise, new contracters put their hats in the ring, and new construction methods arise (think engineered wood trusses v. dimensional lumber as lumber prices have risen). However, there is no feedback loop with land. No matter how expensive it gets, no one is making more of it.

As for the employer paid health insurance deduction: eliminating this is almost necessarily the first step towards universal healthcare. Currently, if it is possible at all, it is very expensive for an individual to buy healthcare. Corporate-sponsored healthcare puts the employer in the position of the customer to the insurer. In other words, the insurer must keep the employer, who pays the bills, happy, much more than he must keep the insured employee happy.

I expect most of you will disagree with my assessments here, but I stand by them. These are two of the worst tax deductions there are, and they SHOULD be eliminated.

After they roll back his earlier tax cuts.