08 November 2009

Tax and Road Policies Encourage Sprawl

..No Kidding:
....the tax code encourages Americans to live in big, energy-guzzling homes, ... and Congress seems intent on further unbalancing the federal budget to egg on home buyers. ...A particularly bizarre feature of the proposed extension is that the credit would go not only to new home buyers, but also to current owners who decide to upgrade.

But the real problem with the credit is that it continues the long-standing federal push toward far-flung McMansions and away from dense, apartment living. In the 1950s, the Interstate Highway System encouraged Americans to flee older urban areas. Nathaniel Baum-Snow of Brown University found that each “new highway passing through a central city reduces its population by about 18 percent.’’ The home mortgage interest deduction further encouraged suburbanization, because rental units are disproportionately in cities while owner-occupied homes are disproportionately distant from city centers...