Tuesday, October 10, 2017

"Your thoughts and concerns are very important to me"


I'm old enough to know better. But more and more, I'm hearing talk of scrapping the mortgage interest deduction. I had to say something. So I wrote my senator.

I wrote
Don't give up the tax deduction for mortgage interest without getting something in return. Trade it for a new system of tax credits designed to encourage the repayment of debt. To ease the transition, design the new system to keep the tax benefit about the same as the old system. The amount of tax benefit can be changed gradually, later.

The macroeconomic problem with the mortgage deduction is that "the largest effect of the mortgage deduction is on household financial decisions, inducing them to increase indebtedness" -- NBER Working Paper No. 23600
http://www.nber.org/papers/w23600

The new system will encourage people to decrease indebtedness.

Three minutes later, I received a response from my senator:
Thank you for contacting my office. Your thoughts and concerns are very important to me and you will receive a more detailed response shortly. I sincerely appreciate your patience in waiting for this response, as our mail volume is often significant.

If this is a request for assistance with a federal agency or an immigration case, please contact ...

That was on 29 September. I'm still waiting for the more detailed response.

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