Yes, exactly.
But I didn't know about the early history of a *general* interest exemption. Thanks, Matt, for providing that info.
On Wed, Sep 1, 2010 at 5:15 AM, Jordan Hayes <jmhayes at j-o-r-d-a-n.com> wrote:
> Matt writes:
>
>> Barry Ritholtz wrote about this recently. He takes issue
>> with the belief that the mortgage interest deduction was a
>> policy designed to encourage home-ownership; he claims it
>> is a hsitorical anachronism from when all interest was
>> deductible when the income tax was originally introduced.
>
> That's true from an originalist standpoint; the question is: when they got
> rid of the interest deduction (principly because that sector had grown, and
> it became clear that it was wrong), why did they leave mortgage interest?
> That's when the policy decision was made.
>
> He's right that it wasn't *designed* to do that; but he's missing the larger
> point.
>
> /jordan
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