if you don't like this then just tell Obama to keep all the tax rates the same. Otherwise, stop the whining.

Is this a news or an opinion piece?  I think it is in the news section.  If true, why characterize the deduction as "generous" and suggest the rich can afford to lose the benefit?  How about you just report the facts and leave the political commentary to the opinion and op-ed pages.

If you have a mortgage over a half-mil, and you're margin is so thin that just losing the tax break above a half-mil makes things a little tight for you, maybe you're over your head.

Imagine, Realtors against something which affects them directly... What's next personal injury lawyers against tort reform..? Basically it would be a cap on the amount someone with a million dollar house or has a second houses on the Cape can deduct from their adjusted gross. It doesn't sound like an elimination there's a reasonable cap and over that amount you don't deduct the incremental interest charges.. I bet all of a sudden folks take out mortgages that hit the maximum amount allowed..

Yes,  government interference, social engineering in the housing market has caused lots of problems, including the crash.  With the mortgage deduction you have another case where people have made reasonable financial decisions based on best guesses of what the government will do.   I would phase out all deductions 10% a year.

Contrary to the article, this deduction was NOT established to boost home ownership. From Wikipedia... A New York Times article notes that, in 1913, when interest deductions started, Congress "certainly wasn't thinking of the interest deduction as a stepping-stone to middle-class homeownership, because the tax excluded the first $3,000 (or for married couples, $4,000) of income; less than 1 percent of the population earned more than that;" moreover, during that era, most people who purchased homes paid upfront rather than taking out a mortgage. Rather, the reason for the deduction was that in a nation of small proprietors, it was more difficult to separate business and personal expenses, and so it was simpler to just allow deduction of all interest.[16]

Getting rid of the deduction for larger homes away from the central-core is a great idea because we all don't need to be providing incentives for people to ruin the environment. In fact, why don't we base the deduction on how far away you live from where you work? The shorter your commute, the higher the deduction, regardless of where you live, with special double incentive for those who live at a city center and don't own an automobile. Oh, raise the gas tax too! And toll all roads heavily coming into the city, the further you drive, the more you get taxed.

Unmentioned in this article--but central to why economists don't like this tax deduction--is the fact that it ultimately inflates house prices enough to cancel out any possible savings.

People typically try to buy as much home as they can afford.  If the government steps in and hands them a few extra dollars (such as it's doing here), they're just going to buy a more expensive house.  Since all home buyers are universally entitled to this same deduction, it doesn't get you a bigger house, instead it raises the price of all houses.

The deduction should be capped now based on income to limit the benefit to the very wealthy, and the rest of it should be phased out gradually, first for new home buyers, and then for the rest of us (in such a way so that the lost income is canceled out by inflation).  That way, no one that is barely making ends meet is going to suddenly be screwed by the change.

Everyones taxes need to go up across the board. low income, middle income, upper income.