Time to Ditch the Mortgage Interest Deduction

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Adam Ozimek glosses a recent study on the effects of the mortgage interest deduction in suburban areas (which are lightly regulated) vs. urban areas (heavily regulated):

Using national data from 1984 to 2007 they found that the MID did not increase overall homeownership. In areas with light land use regulation they found that homeownership among higher income families was increased, and in tightly regulated housing markets homeownership was decreased for all income groups except the lowest….We spend around $100 billion a year on this subsidy, and to the extent that its defenders are correct and homeownership does have positive externalities, it is actually making urban areas worse off.

There you go. This shouldn’t come as any big surprise, since the mortgage interest deduction was always aimed at spurring new homebuilding in the suburbs. But whether or not you think that’s a worthy goal, it apparently comes at the expense of homeownership in cities. It’s a policy that passed its sell-by date long ago. Get rid of it.

(But replace it with what? Middle class homeowners will feel hard done by if one of their cherished subsidies goes away while millionaires get huge tax cuts and hedge fund managers continue to benefit from things like the carried interest rule. And rightly so! But surely there’s some kind of bennie we could give them that wouldn’t be quite so destructive in its overall impact?)

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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