At any given point in time there are a finite quantity of goods in any economy (housing being a prime example). Give everyone more buying power, and buyers begin to "compete" with each other for this finite supply -- with the result of that competition being soaring prices (the "housing bubble").
What this means should now be self-evident to all. The U.S. mortgage-interest tax deduction not only maximizes overall debt levels by enticing debtors to take on greater debt, but these higher debt levels drive up prices significantly.
Not only does this ultimately make U.S. housing less affordable for all, it is an artificial means to allow borrowers to become buried under debt levels their declining incomes cannot possibly sustain over time. Thus it is also a permanent recipe for an endless series of housing bubbles. One cannot argue with either arithmetic or human nature.
We can come up with a very simple title for the agenda of the U.S. government (and the banking oligopoly) to maximize debt-levels among Americans: debt-slavery. We see identical patterns with U.S. consumer debt and student loan debt. Debt slavery represents the pinnacle of "engineering" in the oligarchs' vision of a
: slavery where the serfs wear invisible chains and pay for their own upkeep.
But the oligarchs, and their foot soldiers of debt (the bankers) were not content with merely maximizing the debt on one mortgage for the debt slaves. They wanted to enslave the debt slaves with multiple mortgages. They enlisted the aid of the oligarchs who own/operate the propaganda machine.
Voila! Overnight, "second mortgages" (the ultimate shame/horror of our parents and grandparents) became "home-equity loans." Chumps weren't squandering equity they had slaved for years/decades building up, they were "accessing the additional credit they had earned."
However, for the rapacious vampires of Wall Street; this process of first enticing the chump into one too-large mortgage and then enticing the chump into a second and totally unnecessary mortgage takes too long. Thus, the vampires have announced yet another "innovation" in the U.S. housing/mortgage market: duping chumps into taking on a first and second mortgage at the time of purchase.