Louis writes: >The ruling class understood that workers who owned rather than rented tended to adopt petty-bourgeois prejudices more easily. I imagine that a foray into the policy statements of the legislators of home mortgage interest deduction legislation would reveal some interesting ruling class attitudes.< It's true that home-ownership encourages petty-bourgeois prejudices; being a home-owner myself, I can see the process at work (and I try to fight it). (BTW, has anyone read Engels on the Housing Question and can summarize it? Does he say anything that Beard didn't say in that useful quote?) But I don't think that this accurate theoretical insight encouraged the ruling class to embrace the deduction for mortgage interest. Politics doesn't work that way, while that theory doesn't explain why the law was enacted in one era rather than another. There are a bunch of different (and often overlapping) interest groups within the capitalist class, each with their own goals and ideologies, working within a excessively complex political system (including the Supreme Court, which knocked down income taxes in the 19th century). Such tax laws are enacted when the various interest groups come to compromises -- sometimes pushed by forces outside the capitalist class itself. Because of the way the political system is so convoluted, accident plays a role, too, as when a tax cut for X is traded for some boondoggle for Y. I don't know much about the mortgage-interest deduction, but I would guess that it was instituted after or toward the end of WW II (in the US, of course). Capitalist interest groups favoring it would be the homeowners themselves (since the vast majority of homeowners were capitalists at that point) and the construction industry, probably in alliance with the building trades unions. The immediate cause of its institution, I would guess, was the end of the War, with all sorts of veterans being demobilized. So the deduction (I guess) would be part of the same phenomenon as the GI Bill of Rights (subsidies to veteran education & housing), an effort to avoid the post-World War I disaster, where veterans became a major anti-establishmentarian force. In addition, the extreme optimism of the ruling class after WW II would encourage this tax break. Please correct me if my guesses are wrong. It's possible that the tax break preceded this period. Since then, it's been a sacred cow. I don't think that the interest-rate tax break is going away (nor is the Small Biz Admin. or the Veterans' Admin.) It's too popular. It's probably not much of a subsidy to home-owners, either. Because of the tax break, banks and other lenders can get away with charging higher mortgage rates, capturing much of the subsidy. Jim Devine [EMAIL PROTECTED]
