Except that one is a deduction, which incentivizes/rewards people for doing something with money they've earned that is beneficial to their long term economic outlook
Yeah. Because it's just about paying interest. WTF?
How about "buying a home"? By making the interest deductible, it helps provide an incentive to buying a home. Or at the very least, offsets the cost difference a bit when compared to say, renting.
Sorry, no, it's welfare, pure and simple. I mean, don't get me wrong, being able to write off a portion of the interest on my $700,000 loan for my summer home clearly has a much greater benefit to society than giving working families more money to raise their children.
Because no working families ever buy a home? I know that you envision a world in which everyone is either rich and doesn't need any deductions at all, or poor and unable to afford any of the financial actions which might qualify for them, but the reality is that a hell of a lot of people live well in between those extremes and something like the mortgage interest deduction can make a significant difference for them by allowing them to buy a home, which creates wealth for themselves and their children while still being able to afford to feed and clothe their children.
But you don't want those pesky working class folks to ever accumulate wealth, do you? How can you control them if you allow them to actually own things? Heaven forbid if their children actually start their own businesses or something. That would be a calamity!!! Edited, Feb 16th 2012 7:44pm by gbaji