Although the mortgage-interest deduction is bad policy on numerous fronts, neither party seems keen to take it on. The real-estate industry portrays any cross-eyed look at the loophole as a frontal assault on the American Dream.

To their credit, Republicans baby-stepped in the right direction by trying to drop their usual support for the mortgage-interest deduction from their party platform. Candidate Mitt Romney has called for revenue-neutral tax reform that would lower federal income-tax rates while getting rid of loopholes--what is called "broadening the tax base." (He refuses to be specific on which ones he'd close.) By leaving out mention of the mortgage deduction, the platform would push the message along.

No sooner was that thought on paper than the real-estate industry went to work on the Republican Party. In its place was put a pledge to protect the mortgage deduction if tax reform doesn't happen. Still, progress.

Why offer a tax break for buying one product and few others? If you take out an auto loan, the interest you pay cannot be deducted from taxable income. If you buy a sofa on the installment plan, same no-deal. If you charge airline tickets on your credit card, again, the interest on your unpaid balance is not deductible.

The social-policy argument for the mortgage deduction is that it helps Americans buy homes, and that home ownership stabilizes communities. The first part is debatable. Canada does not allow for a mortgage-interest deduction, and its rate of home owning matches ours.