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Posted at 6:44 PM ET, 12/ 3/2010

Reconciliation

By Ezra Klein

Recap: McCain and the problem of "independence"; the fiscal commission sort of succeeded; and November's job numbers were awful.

Elsewhere:

1) More Eichengreen on Ireland.

2) "The women who read this statement scored significantly higher on average than other women in the class. They also scored higher on average than the men."

3) The mortgage-interest deduction is really bad news.

4) Steve Waldman is always worth reading.

By Ezra Klein  | December 3, 2010; 6:44 PM ET
 
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Next: Wonkbook: Likely deal will extend tax cuts and unemployment insurance; South Korea and U.S. finalize trade pact; Romer on uncertainty

Comments

Ezra, you omitted the laugh line this time; how Eichengreen is "perhaps America's most knowledgeable economist when it comes to E.U.-related issues".

Did your old professor get less gifted in just one day?

Posted by: 54465446 | December 3, 2010 7:01 PM | Report abuse

Ezra, in the interest of being even-handed, you rarely make mistakes on HCR, and have the subject pretty much down cold. I bow to your superior expertise in that area, and will leave the ideological battles to others.

Posted by: 54465446 | December 3, 2010 7:09 PM | Report abuse

the deficit dove is a jobs hawk; therefore, the deficit hawk is a jobs dove.

i prefer austerity fruit to deficit hawk, in addition :-)

Posted by: jackjudge4000yahoocom | December 3, 2010 7:43 PM | Report abuse

That article about the mortgage interest deduction (MID) is ridiculous on so many levels.

It basically claims the MID doesn't help increase home ownership then goes on to express shock at how much money the gvmt loses for each home owner because of the MID. And it then recommends the MID be phased our slowly to avoid shock to housing markets. The author (and Ezra) seems to be unaware that all these things are contradictory.

This article is just part of the new effort to slowly acclimatize Americans to the coming elimination of the MID and to dupe them into believing the MID primarily has favored the wealthy. In reality elimination of the MID will mostly hurt the middle-class, and it's part of a greater effort to shift more of the tax burden away from the wealthy to the middle-class.

Posted by: lauren2010 | December 4, 2010 7:15 AM | Report abuse

lauren2010: If, as the authors argue, the main effect of the MID is to distort housing prices rather than increase ownership, it is completely logical that eliminating it will shock the housing markets, at least slightly. It will alter the prices.

Though I don't know your politics, its funny how every time someone talks about removing a subsidy or tax break, a conservative pops up to argue it will hurt the middle class. Eliminate big-agra farm subsidies? Hurt the middle class! End MID? Hurt the middle class? Eliminate tax cuts for the WEALTHY? They're really middle class!

Real conservatives should want the government to get the hell out of the business of distorting markets, and end the employer health care exemption, the MID, agra tax breaks, etc.

Posted by: CarlosXL | December 4, 2010 10:04 AM | Report abuse

Carlos:

You have your points, but consider this. Many of us bought our houses on 30 year mortgages, Mortgage interest is part of the equation that we used to test our affordability. So now, perhaps 5 or 10 years in, you want to change this. It would be like giving the government the option to change terms on Treasuries after they have been purchased, just because they can.

I'm not worried, because like the deficit commission, this will never happen, However if you were to change the rules, you would HAVE to exempt all existing residential nmortgages in the interst of fairness, thereby rendering most of any proposed cost savings meaningless until years down the road.

Posted by: 54465446 | December 4, 2010 11:37 AM | Report abuse


The adjustable rate mortgage that I had before had me nearly to the brink of bankruptcy because of the never-ending payment increases. Now I have 3.18% fixed rate. I would absolutely recommend "123 Mortgage Refinance" I worked with to anyone I know planning to refinance mortgage.

Posted by: rosageorge | December 5, 2010 2:57 AM | Report abuse

CarlosXL,

lauren isn't a conservative. Lauren is just a progressive/liberal that thinks everyone's out to get her even so much as to distort simple ECON 101 principles that are at work here.

Posted by: visionbrkr | December 6, 2010 9:09 AM | Report abuse

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