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Guest Post: Housing Subsidies - Capitalism’s Smoke And Mirrors

Tyler Durden's picture


Submitted by Ben Tanosborn

Housing Subsidies - Capitalism’s Smoke and Mirrors

I have always looked at government subsidies with suspicion… trying to identify whether they are designed to assist (those in need) or to render support (for a cause). And looking at housing subsidies has been no different.

Housing subsidies to provide assistance with shelter have existed for centuries now, and continue to exist, particularly in developing nations with a high level of poverty, a low level of sophistication in the mortgage and banking systems, and an inefficient or poor land titling system.

There has been economic justification for providing such subsidies based on both the public health argument: due to problems caused by the concentration of population in major urban areas; and the sociopolitical argument: redistribution of wealth to those considered economically disadvantaged to make up for imperfections in the market, and, oftentimes, as a preventive measure of social unrest.

Many, if not most, people would agree with the general use of subsidies in a vertical equity fashion, or the efficient redistribution of wealth for a common social purpose: social justice to provide shelter for those who need it. It is subsidies in housing designed to support a political and not a socioeconomic purpose that bother me. Subsidies as they continue to exist in the US in housing follow in this category – much in exclusivity these days to the subsidies in other developed nations the world over, at least in quantifiable terms.

There is well over two-thirds of a trillion dollars yearly in interest and property taxes claimed as deductions in the federal income tax, or allowed as a component of the standard deduction for those who do not itemize. As a result, there could be as much as $170 billion ($130 b. in interest and $40 b. in property taxes) in subsidies in 2012 by the federal government; and possibly another $30 b. in the other tiers of government, mostly from the states.

That elicits the question… could those resources, $200 billion annually, be reallocated in the economy in a more efficient way? I believe most economists would argue, without needing to resort to Debreu’s CRU (Coefficient of Resources Utilization) that the macroeconomic stability of the US would be better served by using those resources in other areas; some providing a larger multiplier effect for the economy, while others might be used to fund much needed infrastructural changes for the long term economic viability of future generations. So, if this distortionary tax/subsidy is a sad anomaly in a mature economy such as the United States, why do we have it and proudly tout it? And even more importantly, why are all of us, citizens/taxpayers, unaware… no, truly ignorant… of the true cost of this tax subsidy and its positive alternative uses? As most of us would suspect, the reason is political… with a touch of greed and self-serving by politicians.

America’s economy, our capitalistic magical perpetual-motion machine has been forever lubricated by that friction-reducer in Washington known as lobbying… the “illuminated” teaching that takes place on the politicians we elect to serve us in Congress. A division of lobbyists, between 20 and 24 for every representative and senator in the Capitol, tutor these elected officials on what’s good for the country, what might be called the gospel of free enterprise according to the special interests they represent.

One might expect some direct proportionality in the money spent by these lobbyists and the economic impact on the industries/causes they represent. And, if housing and healthcare come close in their share of the gross domestic product, shouldn’t both lobbying groups spend similar amounts? Interestingly enough, according to figures from the Center for Responsive Politics, the “healthcare giants” (American Medical Assn., American Hospital Assn., Blue Cross/Blue Shield and different groups of “Big Pharma”) spent $870 million in the last 14 years to indoctrinate (and help reelect) our politicians. Yet, the National Association of Realtors (NAR) spent only $178 million during the same period to spread their industry gospel and keep those government subsidies in place.

It should come as no surprise to find the NAR spending only one-fifth as much as the healthcare mafia. Home ownership has been made part of the American psyche, and the capitalist system, for generations… as were the other myths of exceptionalism or the American dream. Yet, after decades of blotted subsidies, the US fares no better than most industrialized nations in either the ratio of owner-occupied units to total residential units (about 68 percent) or in actual ownership (equity after mortgages are deducted)… a figure which has been decimated after the recent housing bubble.

The bottom line to housing subsidies in America – that is, allowing deductions for interest and property taxes in owner-occupied residences when computing the federal and state income tax – is one of total absurdity, more so than ever now that we have come to accept a global economy which is shifting middle-class wealth from the haves to the have-not nations… and the prospect of increased mobility due to a chronic state of high unemployment in the form of underemployment.

Housing subsidies have been not only economically inefficient, but deceivingly used by a political system using smoke and mirrors to convince us that we are all “capitalists”, instead of pawns in a capitalist system.


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Sat, 05/12/2012 - 11:32 | 2419752 Alcoholic Nativ...
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Long live private property rights! 

Sat, 05/12/2012 - 11:52 | 2419767 Joe The Plumber
Joe The Plumber's picture

I would expect advocating the raising of taxes to come from a daily koss poster. After all we all know the government can allocate capital more efficiently than the individual. Sarc


Sat, 05/12/2012 - 12:01 | 2419781 Alcoholic Nativ...
Alcoholic Native American's picture

Raising taxes is an absurd idea.  In the Age or quantative easing, tax revenues, like deficits are quaint relics.  The democratic strategy of "taxing the rich" draws liberal dimwits like flies to shit though and this is probably why they are persuing it.

Democrats reelection strategy seems to be tax the rich and let the gays marry.  Lord help us. 

Sat, 05/12/2012 - 12:28 | 2419815 LetThemEatRand
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No doubt the Lord shares your hatred of taxing the Rich, and your hatred of the Gays.   Amen.

Sat, 05/12/2012 - 12:53 | 2419852 Buckaroo Banzai
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The Lord loves the gays. He just hates what they do to each other.

Sat, 05/12/2012 - 12:57 | 2419865 LetThemEatRand
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Almost as much as disobedient children.  Exodus 21:17 - "And he that curseth his father, or his mother, shall surely be put to death."

Sat, 05/12/2012 - 13:00 | 2419871 LetThemEatRand
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He really hates fatherless children, too.  Deuteronomy 23:2 - "A bastard shall not enter into the congregation of the Lord; even to his tenth generation shall he not enter into the congregation of the Lord."

Sat, 05/12/2012 - 13:00 | 2419877 LetThemEatRand
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An unwed mothers?  Get out of here.  Genesis 38:24 - "And it came to pass about three months later, that it was told Judah, saying, Tamar thy daughter-in-law hath played the harlot; and also, she is with child by whoredom. And Judah said, Bring her forth, and let her be burnt."

Sat, 05/12/2012 - 13:07 | 2419891 Buckaroo Banzai
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Luckily for us, Jesus Christ sacrificed himself on the cross to pay for all our sins. You may wish to refer to the New Testament, not the Old.

Sat, 05/12/2012 - 13:15 | 2419907 LetThemEatRand
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I know I'll have as much luck convincing you about gays as convincing my dog not to lick himself, but how about we move on to simpler things.  Where in the New Testament is the part about God and/or Jesus (or the Holy Ghost for that matter) hating anyone who taxes rich people again?

Sat, 05/12/2012 - 13:53 | 2419979 Oh regional Indian
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Everything is a meta-phor. If anyone here believes in fractals (as most should, or there are no quants on this board)...then, if one thing is a metaphor, it's all metaphor.

Like owner-ship. A meta-phor for a flag-carrying land-ship, by the kind dispensation of his majesty, via the treaty of 1783, as long as he get's his due in revenue, from you. AND , as long as all british subjects and american citizens have free passage up and down the coasts on the Great Missisippi River system.

The degree to which the question of owner-ship, in this Lex Romana we all currently inhabit, is a farce, is a deeply nested fractal metaphor in itself.

Plus, Moses was Akhnaten. It's all about eeeeeegypt.



Sat, 05/12/2012 - 16:17 | 2420191 TheGardener
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Lost you on the fractals and moses mate, still agree on you.

Ownership being put in perspective long on your small minded long indian long time ZH resident.

Sat, 05/12/2012 - 20:22 | 2420440 LetThemEatRand
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"have no idea what you're talking about, but agree with you!"

Reach around time.

Sat, 05/12/2012 - 21:32 | 2420514 Conrad Murray
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Plus, Moses was Akhnaten. It's all about eeeeeegypt

Sat, 05/12/2012 - 15:02 | 2420101 A Nanny Moose
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Do you require Gumbint approval in all of your relationships?

Sat, 05/12/2012 - 15:11 | 2420117 Chris88
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"Where in the New Testament is the part about God and/or Jesus (or the Holy Ghost for that matter) hating anyone who taxes rich people again?"

Oh gee, maybe "Thou shalt not steal"  Which is all the government does.

Sat, 05/12/2012 - 21:43 | 2420526 Acorn10012
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Sat, 05/12/2012 - 21:54 | 2420536 Rubbish
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If you understand the New Testament, we are to give all our worldly possessions to the poor and carry up a cross for Christ. In as much I doubt you would pass judgment on thieves or find any problem paying Ceasar what is Ceasars.


The gates aren't narrow because this shit is easy.

Sat, 05/12/2012 - 13:44 | 2419958 FeralSerf
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If that is so "lucky", think how lucky it would be if you submitted to lethal injection in place of some convicted murderer.  How can people be so fucking stupid to believe this shit?  Even sheep aren't that stupid.

Sat, 05/12/2012 - 15:28 | 2420148 Red Heeler
Red Heeler's picture

Fear and Loathing in the New Testament:

If any man come to me, and hate not his father, and mother, and wife, and children, and brethren, and sisters, yea, and his own life also, he cannot be my disciple. - Luke 14:26

Sat, 05/12/2012 - 16:22 | 2420221 TheGardener
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Nietzsche and Robin were right, don`t hate your next akin...
cause they are never coming back...

Sat, 05/12/2012 - 21:24 | 2420503 Rubbish
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This passage is simply showing that nothing should come before Jesus. You cannot exalt these humans above God.

Sun, 05/13/2012 - 07:53 | 2420874 Umh
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Sounds like cult admission requirements.

Sat, 05/12/2012 - 13:16 | 2419912 TheGardener
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So with all those harlots voting who is for childrens rights ? The fatherless should get two votes instead of a father.

The none-male , none-propertied should get two for their
unearned disadvantages and whites, lest there be any left, could still be eligible to vote if having a proven record of
having cut their self-esteem being cut by at least one and a half and passed PC exams and thus be counted one to a dozen.

Sat, 05/12/2012 - 14:25 | 2420038 Amish Hacker
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OK, Mr. Devil-Quoting-Scripture (LetThemEatRand), where in the Bible is baseball first mentioned?

In the big inning.

Sat, 05/12/2012 - 15:18 | 2420131 LetThemEatRand
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I don't recall invoking the Bible in support of baseball, so what is your point?  The clowns above invoked the Lord in their bashing of gays and taxes.  

Sat, 05/12/2012 - 21:48 | 2420530 Acorn10012
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LTER - a swing and a miss.

Amish - too funny!!!

Sat, 05/12/2012 - 20:56 | 2420471 Rubbish
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I'm thinking you missed the whole part about Jesus. He loves a lost sheep who returns just as much as one who never strayed. In fact when he/she returns, it's party time.


He also told us not to lay up riches of this gold and silver (that should go over real good here).  The day you meet the Spirit you won't sweat the small shit.

Sat, 05/12/2012 - 13:04 | 2419883 FeralSerf
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The Lord is allegedly omnipotent.  If S/He/It hated what gays do to each other, S/He/It could have them do something else to each other or disable their gay enabling code.  Are you denying that The Lord has freewill?

Your post, assuming it's not in jest, has to be one of the most idiotic  fucking statements ever.

Sat, 05/12/2012 - 13:13 | 2419902 Buckaroo Banzai
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You have an infant's understanding of God, unfortunately. God gave us the gift of free will, and the downside of that gift was the free will to turn away from Him.

God didn't abandon you-- you abandoned Him.

Sat, 05/12/2012 - 13:25 | 2419922 LetThemEatRand
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Can you explain the Spanish Inquisition again?  Thank you.

Sat, 05/12/2012 - 14:32 | 2420055 Sophist Economicus
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I can. A bunch of moralizing assholes that destroyed the lives of many under the pretenses of doing good. No God was involved. Just defective moralizing, dimwits like yourself.

BTW, read any Rand yet?

Sat, 05/12/2012 - 15:31 | 2420127 LetThemEatRand
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And this is different than the current gay bashing war mongering self-righteous religious right how?  No doubt the defective moralizing dimwits who tortured and terrorized in the name of Jesus Christ thought and certainly proclaimed they were doing God's work then, no?  Did you finish building your Rand shrine yet asshole cultist?

Sat, 05/12/2012 - 15:47 | 2420171 Sophist Economicus
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The 'religious right' is a fabricated term - an intuition pump, if you will, to get the masses to turn from any kind of religion and to convince them to genuflect to the 'elite' instead of their God.  I imagine tha religious people have all sorts of diverse perspectives on gays or anything else.   I think the world and its people are more complex than the stupid characteritions that you are know for on these pages.     But of course, those that protest bigotry the most, are usually the most biggoted.

No one does God's work, BTW, but God (if He exists).   I know you're too stupid to know otherwise.


Sat, 05/12/2012 - 16:44 | 2420246 Rentier
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Dang bro you just owned Rand...

Also, Rand I can assure you those that do the actual gay bashing are not church going peeps.  They are males that find gays an afront and abomination to true male masculinity, one reason why they take it as a personal insult if hit on by a gay which results in them bashing their head in...not because they such holy rollers.

Sat, 05/12/2012 - 20:01 | 2420419 LetThemEatRand
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"Rand I can assure you those that do the actual gay bashing are not church going peeps."

Now that's just funny.  You do realize, don't you, that some of the most prominent "gay bashing" types are gay church leaders and their "flocks."  Haggard comes to mind.  And many Catholic priests among others.  Let me guess -- better to change the facts than debate the ones you can't defend?

Sat, 05/12/2012 - 20:11 | 2420425 LetThemEatRand
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Of course, there's no such thing as a rabid group of anti-gay, war mongering religious zealots who consistently vote Republican and who openly hate "liberals" and "Dems."  Mostly Southern.  Mostly white.  Identify themselves as Christians.  Think Obama is a Muslim.  Just a figment of our collective imagination.  If you can't defend it, deny it exists?

Sat, 05/12/2012 - 20:17 | 2420432 StychoKiller
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Feel free to ask Larry Craig what his "stance" is on this. :>D

Sat, 05/12/2012 - 21:51 | 2420534 Acorn10012
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Feet wide apart?

Sat, 05/12/2012 - 21:40 | 2420522 Rubbish
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Everyone, everything does Gods work. Evil is part of Gods plan too, it has to be. If you think the fallen angels weren't written into the baseball game schedule, then you wouldn't believe God is infinite and the creator of everything.

Sun, 05/13/2012 - 09:25 | 2420938 jwoop66
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Combination of kicking out the muslim invaders and the Church/Govt(very closely related at the time) having too much power.   Whats your point, rand?   If taxes were higher and there were more govt subsidies things would have been better?

Did as many people suffer in the Spanish Inquisition as they did in Stalin/Mao/Hitlers statist utopian endeavors?

Sat, 05/12/2012 - 13:26 | 2419926 Cathartes Aura
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whereas you are here as a representative of God, doing God's work?

I'll try to remember that when reading your more, shall we say, colourful posts. . .

Sat, 05/12/2012 - 13:57 | 2419983 FeralSerf
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You didn't answer the question:  "Does God have freewill?"

An infant has a "greater understanding of God" than you do.  God did not and cannot "give us the gift of freewill" if we live in the same universe God lives in.  Spinoza proved that beyond a reasonable doubt about 400 years ago.   To deny this is to deny cause and effect.  Einstein, Leibniz and many others with much greater minds than yours agree with that.

God cannot abandon me and I cannot abandon it.   Your statement is illogical.

Sat, 05/12/2012 - 14:34 | 2420061 Sophist Economicus
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Spinoza PROVED it????


Sat, 05/12/2012 - 15:08 | 2420109 FeralSerf
FeralSerf's picture

Read any Spinoza yet?  Or is Spinoza's "Ethics" a bit over your head?  (I think you're already, in effect, answered that, BTW.)

Sat, 05/12/2012 - 15:40 | 2420163 Sophist Economicus
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Why, quite frankly I did, in college where I was a Philosophy major.

The problem might be in some of these questions about God might be constrained by our use of logic in our constrained perception of the universe.    It's not a shot across the bow on Spinoza (but I never met a philosophical argument that was ever completed as long as both sides were rational -- just endless chess moves)

The concept of God is a little to big for us mere humans right now.    We really cannot explain the origin of the universe, what is the root cause of magnetism, why there is gravity, etc.    So, when it come to tautologies or silly questions like:

Is God all powerful?   Well, can he create a rock he cannot lift?  I get bored.


Sat, 05/12/2012 - 18:24 | 2420340 FeralSerf
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If the concept of God is too big for us, why are there so many people spending so many resources on the God industry?  Spinoza certainly didn't consider the concept too big.  I question whether you really did read and understand Spinoza with a comment like that.

Who said God is all powerful?  My suggestion of an omnipotent god was sarcasm -- meant to show how illogical the concept was.  Apparently this went over your head as well.  You have plenty of company if it makes you happier.

Sat, 05/12/2012 - 20:14 | 2420429 LetThemEatRand
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Philosophy major, heh?  So do you publicly and loudly denounce all of those who challenge the liberal arts education as a waste of time and nothing but an indoctrination into dreaded and evil liberalism?  And do you agree that education including an education in the arts is critical to being able to analyze the world around us?   Have you ever attended public school my hypocrite friend?

Sat, 05/12/2012 - 20:20 | 2420435 StychoKiller
StychoKiller's picture

Philosophy == Liberalism?  Does NOT compute.

Sat, 05/12/2012 - 20:26 | 2420444 LetThemEatRand
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So you agree that a Liberal Arts education is a great thing, yes?  Or do you not know what it means?

Sat, 05/12/2012 - 22:04 | 2420543 Acorn10012
Acorn10012's picture

Education/learning is good.

Its up to each individual who paid for a L.A. education to say whether is was a good investment. Did they want the knowledge for the sake of having it or to translate the degree into a career?

Sun, 05/13/2012 - 09:33 | 2420948 jwoop66
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What  now constitutes a college level "liberal arts education"  used to be taught by the eighth grade; that is until Progressivism improved the educational system.

Sat, 05/12/2012 - 16:38 | 2420239 TheGardener
TheGardener's picture

Big Pharma has an even bigger joke on this issue.

Big bad diseases heading your way. Subscriptions only might
apply for full fear-mongering maximum disease-protecting limited self afflicted package. Choose your free maximum damaging price.

Sat, 05/12/2012 - 20:15 | 2420430 StychoKiller
StychoKiller's picture

Gheys can't reproduce (without external help).

Sun, 05/13/2012 - 00:49 | 2420729 rotagen
rotagen's picture

The Lord doesn't exist. Denounce your chimp brain.  But I agree, I can endure gays only so long as I don't think about the mechanics of it.

Sat, 05/12/2012 - 12:16 | 2419803 blunderdog
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Although this author clearly appears to believe in the utility of "central planning" concepts, I don't think he said specifically taxes should be RAISED--he said housing interest shouldn't be a deductible expense.

What if housing interest were no longer a deductible expense, and everyone's taxes were lowered equally by the relative amount of revenue "gained" by eliminating that deduction?

That is: eliminate the mortgage interest deduction, then divide $200B by the number of taxpayers who actually pay money to the government and subtract it from their annual total bill.

Would you oppose that?

(I'm just curious to hear your thoughts, BTW.  I have no preference.)

Sat, 05/12/2012 - 13:01 | 2419875 TheGardener
TheGardener's picture

Deductions on the feral federal cat tax from local fat cat taxes are subsidies (!) that should be re-distributed as they have been stolen from hapless property owners anyway .

Got you, comrade. I had a good laugh at the Debreu`s CRU
and than started choking: a hoax or not to be ?

Sat, 05/12/2012 - 13:23 | 2419919 blunderdog
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I think the author is sincere.  I'm not sure whether Joe the Plumber understands that he's defending government manipulation of the housing market.

For tax policy, one idea has always been so obvious...a government COULD tax ONLY the net increase in "money" owned by the subject,

If I have income of $50,000 and expenses of $50,000, I pay no taxes.  If I have income of $50,000 and expenses of $48,000, I pay taxes on $2,000.

Thus the only "income" taxed would be net increase in liquid holdings of all subjects.

The result would be that taxes would be paid predominantly by those experiencing the greatest increase in monetary wealth, which is one of those principles that seems to be popular, and which many people mistakenly believe is currently in effect.

Sat, 05/12/2012 - 13:30 | 2419933 TheGardener
TheGardener's picture

Broken window theory. If you pay them protection money equivalent to have all your windows, doors and fences replaced 4 times a year, then you are really worthy of government protection and should keep paying up . Up to the depletion of your assets.

Sat, 05/12/2012 - 14:10 | 2420011 blunderdog
blunderdog's picture

I don't think you understand: your assets can't be "depleted" by taxation when you pay nothing to keep them.  That's kinda the whole point.

Sat, 05/12/2012 - 14:05 | 2420003 Joe The Plumber
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I know quite a few markets are distorted by government subsidy, but when Ben and his ilk speak of making markets more efficient it is only as a way to justify increased taxes and increased spending

Sat, 05/12/2012 - 14:12 | 2420013 blunderdog
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You don't want to answer the question, huh?

Sat, 05/12/2012 - 20:23 | 2420443 StychoKiller
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"If Congress can employ money indefinitely to the general welfare, and are the sole and supreme judges of the general welfare, they may take the care of religion into their own hands; they may appoint teachers in every State, county and parish and pay them out of their public treasury; they may take into their own hands the education of children, establishing in like manner schools throughout the Union; they may assume the provision of the poor; they may undertake the regulation of all roads other than post-roads; in short, every thing, from the highest object of state legislation down to the most minute object of police, would be thrown under the power of Congress... Were the power of Congress to be established in the latitude contended for, it would subvert the very foundations, and transmute the very nature of the limited Government established by the people of America." - James Madison

Consider yerself answered.

Sat, 05/12/2012 - 23:23 | 2420650 blunderdog
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OK, thread is this: author proposes eliminating deductions for mortgage interest.  Joe the Plumber interprets this as a request to increase taxes.  (May or may not be, no point in quibbling, author's not here to clarify.) 

I ask Joe the Plumber: would he be opposed to eliminating the mortgage interest deduction without raising taxes?

He declines to answer, and you've delivered copypasta that indicates you didn't understand the question.

Kinda pathetic.

Sat, 05/12/2012 - 14:11 | 2420015 mkhs
mkhs's picture

So I spend all my money on booze, broads, and blo so that my expenses equal my income?  Wouldn't that be a lifestyle worth promoting.

Sat, 05/12/2012 - 14:38 | 2420068 blunderdog
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Sure.  Or you could spend all your money on feeding the hungry in your community, or running your business as a hubcap polisher, or buying and collecting precious metals and stock certificates, or whatever else it would be you'd want to do with it.  If you preferred, you could save some of your money and pay taxes on whatever you kept.

This would actually be *preventing* tax policy from promoting any specific lifestyles or choices. 

The thing is that people have had the Feds promoting lifestyle choices for so long that eliminating the current incentives might be mistaken for promotion of the alternatives.  Things like marriage and home-ownership, for example, are currently promoted by tax policies in the USA, and the taxpayers who don't want to marry or buy a home are paying more taxes than the people who DO choose to do such things.

Personally, I would view the availability of unrestricted alternatives as increased liberty. 

One view is that there needn't be any alternatives at all, if you think government *can* know best how all people should behave.  That is: if government just adopts the "right" set of behaviors to promote, everyone would just do what government says and we'd live in totalitarian paradise.

Lots of folks really have no commitment to liberty, they just THINK they do.

Sat, 05/12/2012 - 16:04 | 2420199 mkhs
mkhs's picture


  If you preferred, you could save some of your money and pay taxes on whatever you kept.


You miss the obvious.  This tax on saving discourages saving, and, therefore encourages wasting money on hookers and coke.


Sat, 05/12/2012 - 16:17 | 2420215 blunderdog
blunderdog's picture

Yeah, you're at least two steps behind, dude.

Why do you want government offering incentives for people to save money?

Is that anything like government offering incentives to hire minorities?

Why or why not?

Sat, 05/12/2012 - 20:26 | 2420446 StychoKiller
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"To take from one, because it is thought his own industry and that of his fathers has acquired too much, in order to spare to others, who, or whose fathers, have not exercised equal industry and skill, is to violate arbitrarily the first principle of association, the guarantee to everyone the free exercise of his industry and the fruits acquired by it." - Thomas Jefferson

Sat, 05/12/2012 - 23:12 | 2420641 blunderdog
blunderdog's picture

If you can't think about stuff for yourself, I guess quoting the guys who could really is your best bet.

Oh, I should add: politicians are unnecessary, even the smart ones.  I think you're mistaking me for someone else.

Mon, 05/14/2012 - 15:48 | 2424714 mkhs
mkhs's picture

No, not taxing is not encouraging, but taxing is discouraging.

You only see what you want to see.  You do not want government incentives, but gladly accept dis-incentives.

Sat, 05/12/2012 - 19:55 | 2420416 Omen IV
Omen IV's picture

eliminate the deduction for mortgage interest and shift the demand for housing to what...? how about making more bullets/guns/ planes/ ships /tanks - more worthless shit to rust in the desert or the dock and find new bad guys to weave a story or a double agent to create an incident to blow up this stuff so we can make more useless shit - that would make more sense

Sat, 05/12/2012 - 13:00 | 2419876 GMadScientist
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These are the same people being led around by their noses during every electoral cycle, right?



Sat, 05/12/2012 - 11:55 | 2419771 Silver Bug
Silver Bug's picture

The whole government system is smoke and mirrors. Remember! Nothing in life is free.

Sat, 05/12/2012 - 14:12 | 2420009 deez nutz
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Sat, 05/12/2012 - 22:09 | 2420550 Acorn10012
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Sat, 05/12/2012 - 14:14 | 2420016 deez nutz
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Today I am pleased to sign into law S. 900, the Gramm-Leach-Bliley Act. This historic legislation will modernize our financial services laws, stimulating greater innovation and competition in the financial services industry. America's consumers, our communities, and the economy will reap the benefits of this Act

- William "J-Bone" Clinton

They reaped we got raped ...............

Sat, 05/12/2012 - 11:33 | 2419753 I am Jobe
I am Jobe's picture

LOl. Sheeples were too fucking stupid to begin with. So how is that dream coming?

Sat, 05/12/2012 - 11:35 | 2419755 onlooker
onlooker's picture


Award for worst of the year, make that two or so.

Sat, 05/12/2012 - 11:57 | 2419775 Joe The Plumber
Joe The Plumber's picture

The socialist should just say straight out he wants to raise taxes on certain homeowners, and spend it on governent projects.

Typical socialist. He doesnt have the balls to speak plainly

Sat, 05/12/2012 - 12:36 | 2419825 TheGardener
TheGardener's picture

The socialist soon to live in your basement yelling on you to cut the lawn will have the balls to show you the door on your former house if he thinks his time has come.

"whether they are designed to assist (those in need) or to render support (for a cause)."

Subsidies are never ever designed to assist or to render support. They are there to distort and subvert
voter preferences. Spin times ten , right from the beginning.

Sat, 05/12/2012 - 14:02 | 2419993 Joe The Plumber
Joe The Plumber's picture

I just want these socialist types to man up and say they want to raise taxes .

Seripusly Ben. Dont be a pussy about it. Just say it.

Sat, 05/12/2012 - 11:43 | 2419761 FeralSerf
FeralSerf's picture

The entire tax system, especially the income tax, in America is a total absurdity.  Why should housing be any different?  Why should religious institutions get an exemption, for example?  Do I, (who consider them to be absolute bullshit methods of corralling sheep),  get to pay their taxes for them?  Yep!  Is this not a government enforced religion prohibited by the First Amendment?

Housing doesn't really belong to the sheep.  Any livestock owner would tell you his livestock needs to be sheltered if they're going to be members of a profitable flock.

Sat, 05/12/2012 - 12:02 | 2419779 BeetleBailey
BeetleBailey's picture


THE only way out of this mess. I have a client that has talked to several of Romney's economic advisers - and recently stated he "talked them into a corner" as to FairTax. They could not argue it.

Romney says FairTax would "hurt the middle class" - it's a lie. That he knows it is all the more reason the tax should be put on a national stage. Romney enacting it as a platform during the GOP convention would rock the nation, and set Obama back on his fraudulent heels.

Obama? Of course his advisers were quick to dismiss FairTax as "regressive" - which is nonsense, and hypocritical, as Obama's 9 tax raises of his first term (inwhich he lied over and over again - "no raises of tax of any kind" during his campaign of 08).

ALL were regressive. The cigarette tax alone (161% increase) hit his supposed "base" right in their wallets. That they still back him is a lesson in sheeplery....imbeciles.

Prebate is the big thing. It is too bad that the masses are not educated on this.

It is no wonder to me that every country on the planet that has a decent base of taxpayers and corporations, that has enacted some sort of flat tax or FairTax derivative has bulging coffers, NO flight of corporations going abroad, and happy citizenry.

ABOLISH the IRS. Do away with accountants.

I urge people to fully read up on FairTax....once they do, they see the benefits, and see how the American public has been LIED to for decades as to this idiotic tax percentages and criminal loopholes.

Sat, 05/12/2012 - 12:43 | 2419833 narnia
narnia's picture

unless our currency regime is changed, all of this is really irrelevant because these clowns can always impose an inflation tax.  provided we can have competing currencies, this tax schedlue would be way preferable to the fairtax:

18% tax on GAAP income on US sales (with a comp addback over a certain level for any individual) for any company that wants limited liability.

a tarriff regime that is higher so every company that does business in the US complies with our GAAP based rules or pays a fee to not comply.

keep existing fuel taxes.  get rid of all other federal taxes & compliance.

states are limited to consumption based taxes.  

slash government spending at all levels to match revenues.

Sat, 05/12/2012 - 13:48 | 2419948 Kobe Beef
Kobe Beef's picture

...and no more fucking subsidies!


@Beetle: abolish the IRS= +1

@narnia: competing currencies & slash government spending= +1

Sun, 05/13/2012 - 09:50 | 2420960 jwoop66
jwoop66's picture

Don't forget the tanning booth tax!   That is good government!   

 Actually I don't understand why the economic crisis hasn't ended yet.   Between the tanning tax, the cigs tax and cash for clunkers the economy should be roaring like a lion!  Maybe some of you collectivist geniuses(rand, an anonymous etc) could tell me why these brilliant govt ideas didn't solve all our problems!

Sun, 05/13/2012 - 13:02 | 2421412 heresy101
heresy101's picture

The 1% must have spent a bundle of money to come up with this POS idea hoping working people would fall for this con.

The "Fair Tax" just transfers all taxes to the "sheeple", while allowing the Banksters and their friends off scot free. While the 1% spend obscene amounts of money (a lot on illegal things such as cocaine), a 23% tax on their spending would be a gigantic tax cut. Most of their money is made from unproductive methods of speculating in derivatives, closing down factories for bonuses, moving jobs overseas to avoid paying taxes (Apple). NONE of this would be captured by the "Fair Tax". The pittance that they are paying at 30% would drop to 5% with the "Fair Tax".

Thanks for being a shill for the 1%. What a stupid idea.

Tue, 05/15/2012 - 19:40 | 2429548 BeetleBailey
BeetleBailey's picture

"The "Fair Tax" just transfers all taxes to the "sheeple", while allowing the Banksters and their friends off scot free."

WRONG!!! I'd like to see this "scot-free" loophole that this 1% would have. Show it to me.

Black markets for drugs are a pretty lame excuse as well.

Oh, and don't fog up the talk by using the fucked UP derivatives markets in this - that bitched up hot mess of puke needs to be burned to the ground.

The 1% HATE this idea heresy. If it were "so good" to them, we'd have FairTax commercials out the bunghole, and talking heads on TV selling in enmass.

Sat, 05/12/2012 - 11:55 | 2419762 technicalanarchy
technicalanarchy's picture

Our tax system is set up to shift and control. Over valuing houses and the Section 8 program has basically set government pricing on rentals under a certain amount. Making it a free (or almost free) dream land for the poor at the cost of the working lower and middle class (in higher rents to compete with the govenment subsidies). Groceries are blowing my meager mind lately. If you shop between the 1st and 10th seems higher cause I think they are raising prices till the food stamp cards run out. Then lower the prices when the food cards are out and they actually have to compete for money. There is an added cost over taxes to competing with free government money. 

I don't agree with property taxes cause that means you are just renting your property and own nothing.

Sat, 05/12/2012 - 13:04 | 2419884 Buckaroo Banzai
Buckaroo Banzai's picture

Neither property taxes nor income taxes have any place in a free society. If your labor is taxed, then you no longer own it...and if you don't own your labor you are by definition a SLAVE. Likewise, if your property is taxed, you no longer own it because it will always be subject to a tax lien and seizure by the state if you don't pay.

There is a reason why the Constitution as originally written outlawed direct taxes like income taxes, and only allowed indirect taxes (like excise taxes)-- they actually cared about freedom back then, unlike today, apparently.

Sat, 05/12/2012 - 16:45 | 2420251 blunderdog
blunderdog's picture

     ...if your property is taxed, you no longer own it because it will always be subject to a tax lien and seizure by the state if you don't pay.

If taxation on land-ownership is unreasonable, it's similarly unreasonable to expect government to be involved in the administration of that ownership. 

If I showed up at your house and killed you and your family and asserted ownership, who would you expect is going to care?

You already paid the previous owner, and no one else is involved in your assertion of ownership.

You may be making progress, Buckaroo, I'll make an anarchist of you yet.

Sat, 05/12/2012 - 11:44 | 2419763 Manthong
Manthong's picture

OK, so eliminate stimulative private household tax reduction so you can spend more money on government section 8 housing for non taxpayers. Marx would be so proud.  

Sat, 05/12/2012 - 12:14 | 2419794 Alcoholic Nativ...
Alcoholic Native American's picture

A lot of capitalist prefer section 8 renters because their payments are so reliable.  Government spending has a very good track record of trickling up.

I know it's cool to hate on socialism, but those in the know know how the game works: )

Sat, 05/12/2012 - 12:58 | 2419869 Buckaroo Banzai
Buckaroo Banzai's picture

The payments are steady, but the problem is that Section 8 renters absolutely trash the properties. These are people with no respect for themselves or anything around them. Section 8 landlords call carpeting "apartment diapers", which says it all.

Sat, 05/12/2012 - 14:16 | 2420023 FeralSerf
FeralSerf's picture

I thought you were claiming Jesus died for these Section 8 renters' (among others) sins so it's not a problem?

Do you know what a "glittering generality" is?

Sat, 05/12/2012 - 16:02 | 2420196 Buckaroo Banzai
Buckaroo Banzai's picture

Jesus may have died for their sins, but that doesn't mean He is going to clean up the mess they made.

You have the logical capacity of a 3 year old. Grow the fuck up.

Sat, 05/12/2012 - 18:09 | 2420320 FeralSerf
FeralSerf's picture

If the mess they made are part of their sins and you imply that they are, then it does mean he died for that too and ergo he has compensated fully for the mess they made.

You have the logical capacity beneath that of an worm.  A three year old at least understands a bit of cause and effect.  He yells and he gets a lollypop.  You do not seem to comprehend that concept.   Unfortunately you cannot grow the fuck up.  "The Lord", if he does have freewill (which I doubt), did not wire you that way.  That's why you and your ilk are destined to spend your lives tethered to some lying preachers, politicians and media bums.

Sat, 05/12/2012 - 22:16 | 2420555 Acorn10012
Acorn10012's picture

"Go, and sin no more.". At some point, I think we're expected to quit acting like fuckwads.

Sun, 05/13/2012 - 02:43 | 2420773 q99x2
q99x2's picture

"glittering generality"

A term commonly used to implement NWO globalist agendas.

Sat, 05/12/2012 - 11:51 | 2419766 Joe The Plumber
Joe The Plumber's picture

" could these housing subsidies be better allocated"

This is the best spin I have heard. I will translate to english

" we want the government to collect more tax money from certain homeowners so the government can spend it elsewhere"

Sat, 05/12/2012 - 11:52 | 2419769 rsnoble
rsnoble's picture

Let's just outlaw property taxes in the US. 3 states up north are working on that right now. Shrink the gov't, pay you're own fucking retirement assholes. Nothing worse that going to the gazillion dollar courthouse and finding one office after another stuffed with fucking morons who do nothing but stick it up your ass everyday. Death to public unions.

Sat, 05/12/2012 - 11:56 | 2419772 rsnoble
rsnoble's picture

BTW you ever notice that.........."we can't afford to do that" yet all their shit looks like a fucking museum?  People living in poverty 2 blocks from the statehouse, entire fuking state is broke "oh, let's renovate the state building for $50 million" passes in 2 fucking seconds. I hate these people, they are nothing but parasites.

Sat, 05/12/2012 - 12:23 | 2419810 ebworthen
ebworthen's picture

During this "crisis" my city has built a fancy new courthouse, and Police/City office building; all with real wood paneling, marble, granite, and lighting that looks like it came from Tiffany.  New trucks, motorcycles, and other city vehicles, trailers, mowers - haven't seen anything that looks more than three years old.  No expense spared.  All the while alternately raising property valuations, fees, rates.

Sat, 05/12/2012 - 15:00 | 2420098 AustriAnnie
AustriAnnie's picture

I got three words for ya:

Transfer. Of. Wealth.

Sat, 05/12/2012 - 16:04 | 2420202 Buckaroo Banzai
Buckaroo Banzai's picture

I got one word for ya: Theft.

Sat, 05/12/2012 - 12:34 | 2419816 Catullus
Catullus's picture

I hear ya

What's even funnier is that no one in DC ventures out there because of the crime  and now they've bought up a poor, black neighborhood to make space for the DHS.  So they decrease the amount of affordable housing around DC so they can tell us they need to increase taxes to pay for these monstrosities.

Sat, 05/12/2012 - 13:44 | 2419960 Kobe Beef
Kobe Beef's picture

If I ran the DHS, I'd get real serious about security. As crime is a far more serious threat to our citizenry than "terrorism", my men would use those criminals for target practice.

Sat, 05/12/2012 - 11:53 | 2419770 nmewn
nmewn's picture

Another socio-economist speaks.

Sat, 05/12/2012 - 11:59 | 2419778 Joe The Plumber
Joe The Plumber's picture

He should go back to daily kos

Sat, 05/12/2012 - 11:57 | 2419777 TheGardener
TheGardener's picture

Congratulations MDB ! From troll to poster to regular to contributor ! MDB going editorial !

What a reek of good information...

Sat, 05/12/2012 - 12:10 | 2419786 TheGardener
TheGardener's picture

This is a troll trap article ! And I have fallen for it !
;-) Down vote me twenty times and my trolling is over...

P.S. Don`t take my word for me putting my presence on line
because of some socialist gibberish slime ;-)

Sat, 05/12/2012 - 12:07 | 2419788 Marco
Marco's picture

Wow, Tyler believes in a redistrutive fiscal policy for social justice? Guess I completely misjudged him by the sentiment of the majority of ZHs.

Sat, 05/12/2012 - 12:32 | 2419818 Atomizer
Atomizer's picture



Look above ---Submitted by Ben Tanosborn


When houses where used to inflate growth, it provided a false state of production. At the end of day, higher property taxes just paid for municipalities’ 4% yearly raise increases and unneeded city expansions plans. After the fall of the housing market, many learnt that the hockey stick budget planning required continual yearly property tax increases  to sustain the status quo and fund new development projects.  

Just watch Europe 

Killing Joke - European Superstate

Sat, 05/12/2012 - 12:10 | 2419792 michigan independant
michigan independant's picture

Wrong, and they have no shame about it. I give to those in need and Statist never figure that out. Johnson fought two wars which was people across the other pond who bent as a reed in the wind and the war on poverty at home who would not work. When asked why are we there he said it makes to much money for my supporters. The infirm, very young and elderly are exempt. I thankfully have never been out of work. We have watched your type for decades and the masters you serve.

Sat, 05/12/2012 - 12:19 | 2419798 Catullus
Catullus's picture

There is well over two-thirds of a trillion dollars yearly in interest and property taxes claimed as deductions in the federal income tax, or allowed as a component of the standard deduction for those who do not itemize. As a result, there could be as much as $170 billion ($130 b. in interest and $40 b. in property taxes) in subsidies in 2012 by the federal government; and possibly another $30 b. in the other tiers of government, mostly from the states.

So not taxing people is a subsidy? Not stealing from people is a subsidy according to the author.  Then he questions if this "subsidy" could be better spent by the government. 

So people who recieve this "subsidy" don't spend their money on something else?  The author some how knows that people aren't using their tax credits to pay for the rest of their lives?  That somehow if the government just taxes and spends more, it will be more "efficient" overall for the economy. 

Total and complete bullshit.

Sat, 05/12/2012 - 12:24 | 2419811 blunderdog
blunderdog's picture

If you steal from EVERYONE, but only give back to SOME of your victims,it's sensible to view as a subsidy, yes.

Kinda like the EITC.  You know the Feds give money to people who have really low incomes, right?  But they only give that money after having already taken a bunch of money from those people over the course of the year.

Sat, 05/12/2012 - 12:31 | 2419819 Catullus
Catullus's picture

Sort of like how Social Security is the only retirement fund guaranteed to bring in a negative return over time.  But at least I get part of my money back!  Hahaha. 

Sat, 05/12/2012 - 13:26 | 2419925 blunderdog
blunderdog's picture

You sound confused.  Social Security isn't a retirement fund, it's a tax levied primarily on lower wage-earners.

A "retirement fund" is a collective investment in which the participants retain notional ownership of a "share" of the total value of the fund. 

The taxpayer owns no "share" of government operating expenses.

Sat, 05/12/2012 - 13:32 | 2419938 Catullus
Catullus's picture


Sun, 05/13/2012 - 08:12 | 2420888 Umh
Umh's picture

It may be one of the taxes that is being collected from the working poor, but it is not levied primarily on the poor.

Sun, 05/13/2012 - 16:33 | 2421912 blunderdog
blunderdog's picture

Well, the folks with high incomes pay it on only a tiny fraction of what they bring home, so it does kinda work out that way.  The cap on it is incredibly low.


Sat, 05/12/2012 - 12:37 | 2419824 rwe2late
rwe2late's picture

 not taxing some while taxing others IS a form of subsidy (backhanded though it may be) for those who do not have to pay ...

and further, designing taxation to further profit select interests is a form of subsidy to those interests (e.g. tax accounting laws favoring large global corporations over small local ones )

Your implied anarchist belief that no government spending can ever be worthwhile is "complete bullshit", though quite understandable given the prevalent operations of our corrupted government.

Sat, 05/12/2012 - 13:33 | 2419936 Catullus
Catullus's picture

So when your house doesn't get robbed and your neighbor's house does, it's you that's stolen from your neighbor. Not being mugged in NY is the new mugging of those who have been mugged.  For your next trick, will you explain how not purchasing health insurance is increasing someone else's health care costs because everyone else is not paying for it?

And it's not implied anarchism, it's explicit at this point.  The $200bn a family doesn't get taxed would not have been better spent by the government. 


Sat, 05/12/2012 - 20:05 | 2420408 rwe2late
rwe2late's picture


 You are an math-challenged idiot

if you are unable to fathom that

1) taxing everyone and refunding the tax collected back to a select few (which you would recognize as a subsidy)


2) taxing everyone EXCEPT the same select few

both effect the SAME result, a subsidy (monetary benefit) for a few.

A rose by any other name is still a rose.


Sat, 05/12/2012 - 23:14 | 2420643 Catullus
Catullus's picture

Show me the math, assbag.  Write it out in a equation.  Do it.  I challenge you.

Also, you piece of dog shit, you can start by showing that a tax deduction is not a tax refund.  Of course you're slipping between examples, but logic-challenged fuck sticks like yourself don't pick up on that.  Try to stay on topic next time.

Sun, 05/13/2012 - 10:02 | 2420981 rwe2late
rwe2late's picture

your whole argument rests on a word game, alleging "refunds" are not "subsidies"

$X = dollars of person X

$Y = dollars of person Y

$T = dollars taxed

If $X=$Y, and $T>0, then


~ ~ ~

$S = subsidy given

If $S > 0, then


If $S=$T,

$X-$T+$S = $X-$0


SAME result whether X is not taxed or is subsidized, refunded, gifted, blessed or whatever term you understand


Mon, 05/14/2012 - 08:03 | 2423116 Catullus
Catullus's picture

I'll ignore that for X and Y to be taxed the same, they have to have the same income.  Taxes are based off income in this country. And the mortgage interest deduction reduced the taxable income.

But for the rest, I'll concede.  You won.  You demonstrated that if a subsidy is equal to or greater than the taxes, the net-net effect is that X is better off than Y. 

Since I've conceded you math and demonstration, I get to use it now.

$X = dollars of person X

$Y = dollars of person Y


If $X=$Y, and $Ty  >0, then [you left that one out, but I understand]


~ ~ ~


If $S > 0, then


If $S=$T,

$X-$T+$S = $X-$0


So because X didn't have money stolen from him, he is better off than Y.  OR because X had insurance for theft, he got a subsidy, he is better off because Y didn't have the insurance (or nice grandma, or benevolent government).

Therefore, not stealing as much is the same as subsidizing someone's lifestyle.  That's the point I'm trying to make about what the author is inferring. 

We're probably arguing different things.  Thanks for putting in the effort (I don't mean that in a sarcastic way). 


Sat, 05/12/2012 - 12:18 | 2419801 rwe2late
rwe2late's picture

 Isn't the subsidy designed for banks to charge (a higher) interest on (bigger) loans?

To begin with, the tax break only applies to those who itemize. That excludes a number of (lower) income filers with less costly homes (and/or smaller mortgages) inasmuch as the interest paid would have to exceed the standard deduction.

Those who purchase the most expensive houses permitted with the biggest loans would typically get the biggest tax subsidy.

To further push in that direction ( and backstop the mortgage lenders), the upper limit for Fannie Mae was sharply raised to include rather pricey homes despite adding to Fannie Mae's insolvency.

Sat, 05/12/2012 - 12:18 | 2419805 the grateful un...
the grateful unemployed's picture

if they would abolish the marriage / family deduction the rights of gays to marry would not be an issue. a tax break is an entitlement to be protected at all costs (rich people will do anything to protect their life style.. and even the not so rich..)

the mortgage deduction was removed? if you do a short sale you get a 1099 on the difference? how far should we take this.


when you mention reallocating money for infrastructure i think of thousands of bridges to nowhere, and six lane freeways with no cars on them. if the reallocators had been out in force when Henry Ford opened his business, the politicians would have used the tax money to buy thousands of horses.

Sat, 05/12/2012 - 12:22 | 2419809 GreatUncle
GreatUncle's picture

Personally I think subsidies are not designed to assist they are used to conceal an underlying problem. Once implemented the problem is now masked so nobody can see them and everybody goes along thinking the problem solved.

No such thing and it then becomes a cost to the system and economy and instead of tackling it at the start it grows, oh does it grow.

Now what is the debt again?

Best one for me 1908, state pensions were non-existent in the UK?

Introduced why? So a person retired had something to live on and not fall into poverty but what happened before that and why did it occur? As a general test of the concept the Red Cross received the royal charter around the same time coincidental? Not really as most undeveloped countries at this time were living off the land and poverty not really a concept globally. Sold to the population by their government as a good and wonderful thing but it now has an end cost that has to be paid. So what happened and what went wrong?

The problem is? You cannot earn and keep enough of your income in a lifetime to support yourself. A century later and potentially we got a 5 trillion liability on this now. Did that grow big enough for you?

Personal opinion, but if you see a subsidy anywhere, then consider you have a problem and if not dealt with honestly at the start it becomes a far larger end problem.

Sat, 05/12/2012 - 12:29 | 2419814 ebworthen
ebworthen's picture

Decades of lies and misdirection. 

Home mortgage interest tax deduction only encouraged less principal payment and an illusory benefit.

Public housing?  It's like a car that Parents give to their kids; the kids didn't put any money into the car so they trash it.

Sat, 05/12/2012 - 13:56 | 2419984 Kobe Beef
Kobe Beef's picture

...and since the Parents stole the money from the neighbors to buy the car in the first place, why not buy the kids another after they trash the first few. Yeah, I get it.

Sat, 05/12/2012 - 12:33 | 2419820 Snakeeyes
Snakeeyes's picture

I gave a presentation on The Hill essentially saying that housing subsidies effectively gave our economy a heart attack. On Fannie and Freddie's future, I said the subsidies are the real problems and SOMEONE will provide them if Fannie and Freddie go away.

Sat, 05/12/2012 - 12:38 | 2419823 Dingleberry
Dingleberry's picture

We have always been socialist, except most of the socialism goes to benefit corporations. Think Medicare, esp. Part D (big pharma). Think defense (too many to list). Think tax breaks/credits designed to encourage debtors to go into more debt for corporate profits (too many to list). Including homebuilders.  Of course, this is all designed to "help" YOU, the hardworking, downtrodden taxpayer.

There was a time in the not so distant past that social security income was not taxed at all, you could write off your interest on credit cards, auto loans and such, unemployment income was tax free, etc. look.  And at the same time corporations have been able to technically "move" offshore, pay no taxes, and enjoy freely penetrating our consumer markets thanks to our esteemed politicians, etc. etc.  ANd don't even get me started on the FED.  You have been slowly squeezed like a lemon, and you are told you are getting "too much" from governmen socialist policies.  Yeah right.  All the while the wealth disparity has gone nuclear, and getting worse.  BTW, both parties are to blame. Believe in and/or support one party over the other at your eternal shame and embarrassment.  

Sat, 05/12/2012 - 12:37 | 2419827 denny69
denny69's picture

Capitalism died about five years ago. It's gone and it will remain lost for a long while. What these billionaire party boys are playing is nowhere near the capitalism of yore. It's something, but not capitalism and until the entire lot of them are thrown in prison, paraded through the streets, a la the Chinese method, with signs around their necks reading, "I'm a greedy asshole" or lined up against the wall for brain painting, it will continue to accelerate the total destruction of the markets and everything associated with them. I'm somewhat (that's 'somewhat') surprised that the more honest and competent capitalists haven't moved on these bums yet. In a few years they've altered and now are destroying a structure and methodology which took centuries to implement and develop. What the risks are now affect all of us, even those who are not involved in the game because that's what it's devolved to - a game and when one is talking about the welfare of billions of human beings and the fate of nations, games are the absolute last thing one would want to be spending their time on. Yet it does appear that game playing might be all we're left with after the smoke clears. Where's the Monopoly board?

Sat, 05/12/2012 - 15:20 | 2420134 Chris88
Chris88's picture

It died way longer than 5 years ago.

Sat, 05/12/2012 - 12:46 | 2419838 digalert
digalert's picture

I started to read this crap till I read to "property taxes claimed as deductions". Apparently you have a problem with the premise of deductions? How about we eliminate property taxes and you take your 'social justice, redistribution of wealth' bullshit elsewhere?


Sat, 05/12/2012 - 12:48 | 2419840 Stackers
Stackers's picture

" instead of pawns in a capitalist system. "

The last line shows the writer knows nothing and is just another marxist boob. We do not live a captilatist system. We live in a centrally planned facist cronyism systsm. but yes we are pawns to it.

Sat, 05/12/2012 - 12:50 | 2419846 1eyedman
1eyedman's picture

why only point out NAR?  what about all the builders out there?  and morgage banking money?  put those in and you probably come a lot closer.


in order to propigate an ownership socity (pls excuse), owning a home must be encouraged, not simply closing and getting a mortgage...but paying off the mortgage.  way back, our great gr parents (all dead, no living memory) used to value owning a home outright to ensure a roof over their family.  owing meant no one could come along and kick you out or raise the rent so high you had to leave...that is the true purpose of home ownership.  post ww2 and really since we left the gold standard, home became investments and people happily counted on their equity as future spending.  the baby boomers moved over and over roling their equity up each time.   it is this activity that resulted in the current widely known stat that a mortgage on average only lasts about 7 years b/c people either move or refi.  i am sure that stat will start to grow in length again.  genx now will be the first generation in 4 to live in one home most of their lives.  at least those who survive this credit-intact.   this will have a positive effect on the stability of neighborhoods and communites and children growing up with the same group of friends for many years.

the de-stabilization began back in the early 90's;  due to ez fha financing it became cheaper for builders to spread out further and further from city centers to put up newbuilds and lure people out into the sub and exburbs, hollowing out the income and socioencomic bases in cities.  what was left was elite wealth, and very poor ghettos. in the burbs you got new everything.  people actually disdained buying a 'used' house.  the tax infrustructure for cities crumbled and created a vicious circle.   but builders, bankers, and capital made out.   the could have done just as well in the city, revitalizing and rehabing.....but govt invervention via subsidies mispriced capital and led to many unintended circumstances, along with environmental degredation, more use of cars/fuel etc...overall everything tended to become more ineffecient: time, commutes, gas costs, high prices to live in burbs low prices in city, degradation of infrastructure.    mispricing of capital due to govt intervention

Sat, 05/12/2012 - 14:30 | 2420014 Kobe Beef
Kobe Beef's picture

um.. how to put this "sensitively"...

Lots of "tax base"-type people moved out of urban Detroit, Cleveland, Chicago, Philadelphia, Newark, Milwaukee, Baltimore, D.C., New York, & LA starting around 1964. Maybe something was going on around then. Maybe it's still going on...

I agree with you about bankers, developers, & realtors making out, but there is still another, largely unspoken factor at work in suburban flight/urban plight.

Open the other eye and you can see.



Sat, 05/12/2012 - 12:51 | 2419848 JR
JR's picture

The  philosophy of this article, i.e., wealth redistribution from an income tax (the only disagreement being who receives the redistribution of wealth), accommodates the 1913 Marxian philosophies of the Money Creators, i.e., that the Fed Board of Governors comprises a Supreme Court of Finance from which there is no appeal of any of their rulings.

The 1913 Federal Reserve Act would forever need a supporting partner: namely the Federal Income tax passed the same year.

Well-known Hearst columnist Westbrook Pegler wrote in 1955: “The Schiffs, the Warburgs, the Kahns, the Rockefellers and Morgans put their faith in House.” House openly espoused Socialist views.

Often called the “unofficial Secretary of State,” Colonel Edward Mandel House (the bankers’ moving force behind passage of the Acts), wrote the novel Philip Dru, Administrator, ostensibly fiction but “actually a detailed plan for the future government of the United States“which would establish Socialism as dreamed by Karl Marx,” according to House. This “novel” predicted the enactment of the graduated income tax, excess profits tax, unemployment insurance, social security, and a flexible currency system…and a dictator – the Administrator of the Republic. In short, it was the blueprint which was later followed by the Woodrow Wilson and Franklin D. Roosevelt administrations.

Charles Seymour’s The Intimate Papers of Colonel House, as described in the book Financial Terrorism, “notes that this man was the ‘unseen guardian angel’ behind the passage of the act creating the Federal Reserve. House’s Marxian goal for America could not be achieved without either the Fed or the income tax, both of which came to life in 1913. Once initiated, the two mechanisms began speeding America toward the totalitarian socialism favored by Marx.”

Sat, 05/12/2012 - 14:19 | 2420029 Kobe Beef
Kobe Beef's picture

Keep spreadin' the word, brother! The people certainly won't learn this in an "american history" class.

Sat, 05/12/2012 - 14:25 | 2420042 FeralSerf
FeralSerf's picture

House should be called the "unofficial President of the United States."  And Wilson his assistant president.

Sat, 05/12/2012 - 15:20 | 2420133 GMadScientist
GMadScientist's picture

Marxian? LOL

Where do you people get such powerful narcotics so consistently?

Sat, 05/12/2012 - 15:34 | 2420152 AustriAnnie
AustriAnnie's picture

Is it the use of the word "Marxian" that is so funny to you? (he did in fact use the word correctly)

Or is it funny that someone would question Marxian theory?

Sun, 05/13/2012 - 09:47 | 2420958 falak pema
falak pema's picture

FED and MArxian is like Pope and sodomy; having said that, the Borgias achieved that impossible synthesis in private all the while saying Saint Peter and his legacy were immaculate. 

So when you qualify the FED as being MArxian in theory you declare the Papal office as being friendly to back door butt bashing. One Pope's acts does not make the Papal legacy invalid, but repeated use of Indulgences and the Inquisitorial method does.

The FED's brief was not MArxian but the private structure of its shareholders ensured that ONE day it would morph without due process and checks and balances, as it HAS today. Just like the Papal church lost it's hegemony  when Luther nailed it and Erasmus derailed it.

Some legacies have ORIGINAL sin written all over their faces. In the case of the FED it wasn't MArxian bent but private Oligarchy power from INCEPTION, a no checks and balances bent. Get your facts and their interpretations right and don't bark UP THE WRONG TREE.

Sun, 05/13/2012 - 10:04 | 2420991 GeneMarchbanks
GeneMarchbanks's picture

It's as if I have to follow a dog around with a pooper scooper so the message doesn't get lost, which is annoying.

Your beloved 'Merika ain't Marxist, now or at any point in it's history as falak correctly points out but clumsily reaches back into continental history for a nonsensical comparison. Luther doesn't deserve such praise having spun-off another distortion of NT on top of an already existing distortion by the Roman Catholics. Stop using that association, it's inaccurate to say the least.


Sat, 05/12/2012 - 12:59 | 2419866 Abraham Snake
Abraham Snake's picture

I wasn't convinced that eliminating this deduction would be a good idea. Your statement --the macroeconomic stability of the US would be better served by using those resources in other areas-- may be valid.

What other areas of spending do you have in mind? Is keeping that money available at the community level a bad idea?

The problem is that the US government spends like a drunken sailor, an angry drunk at that. If they managed to get their hands on an extra 200 billion per year, it would probably just justify another Iraq style trillion dollar quicksand war. The problem isn't that the government lacks income, the problem is no level of income is enough for its grand ambitions.

Sat, 05/12/2012 - 13:06 | 2419889 GMadScientist
GMadScientist's picture

How about we remove the write-off and scale back ambitions? There's no fiscally sane solution involving only one or the other.

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