Ederik Schneider Online

Thursday, December 13, 2012

Reason: Anthony Randazzo and Dean Stansel: Who Benefits from the Mortgage Interest Deduction?

Who Benefits from the Mortgage Interest Deduction?

The Mortgage Interest Deduction or MID for short is something thats going to have to be looked at, either during. The fiscal cliff discussions to help get our debt and deficit under control or in broader tax reform in the 113th Congress. Because it costs around 83B$ a year and it benefits a lot of people who simply don't need it, which makes it somewhat wasteful. Because wealthy people who own vacation homes, benefit from the MID, as well as people who own mansions. Or second homes, or homes worth over a million dollars or more, so tax reform would be a good thing to take up either now. As either to reach an agreement on deficit reduction or broader tax reform in 2013 or a combination of both in. A somewhat balanced deficit reduction package that puts the US Government in pace to start to pay. Down our debt and deficit and doing tax reform in a way that doesn't hurt anyone who actually needs these tax. Subsidies, like the MID, we might not have to eliminate it but we could cap it at lets say only one home and. That home being worth under a million dollars and then index the MID cap for inflation.

The MID alone reforming that won't be nearly enough to help pay down our debt and deficit, its an expensive. Tax deduction 83B$ but we are looking at a situation where we are going to need 4T$ in savings over ten years. 83B$ would just be 2% of that, we also need to look at other tax expenditures like the subsidy for business's that. Send jobs oversees, we should eliminate that right now and completely end it and replace with that would encourage. Companies to create jobs in America, that would be an example of overall tax reform that would get us off of the income tax. And replace it with what I call a Progressive Consumption Tax, that would tax things that people need to live well. Cheaper then luxury items and allow the Federal Government to tax people based on what they takeout of society. Rather then what they produce for society, so people and business's are encouraged to be productive. And taxed when they take out of what's been created in the country.

As former US Comptroller General David Walker has said, the US Government has simply promised more. For its citizens at our expense, that they have the resources to pay for currently and that Americans are willing to pay for. Which means we need to figure out what do we need as a country for government to provide for us. That can be financed in a fiscally and economically responsible manner and where we can cut back because. We simply don't need government doing those things or we can't afford to have them.