Reduced Mortgage Interest Deduction (MID) coming?

Urban Institute’s publication titled, Reforming the Mortgage Interest Deduction by Eric Toder, Margery Austin Turner, Katherine Lim, Liza Getsinger suggests that

Only individuals who itemize deductions can benefit from the Mortgage Interest Deduction (MID), and the value of the deduction increases with the marginal tax rate. If the government wishes to promote home ownership, a refundable tax credit available to all taxpayers would be more effective.

Henry Paulson, former US Treasury Secretary, recommends that

We should go further and reduce the subsidy for home ownership that helped create the crisis.  The central place of home ownership as part of the American dream reflects a bias of our society that is unlikely to simply end.  Policymakers may well decide that we should continue to facilitate lower-cost mortgages through a subsidy to mortgage credit guarantors.  Even so, the scope of the subsidy should be reduced by rationalizing and reducing the missions of the FHA and the successor(s) to Fannie and Freddie.  I would recommend limiting the availability of the subsidy to smaller mortgages or lower-income buyers or both.  And the price the government charges this new private-sector entity for its credit guarantee must be high enough to leave room for a robust private-sector mortgage market that serves taxpayers and homeowners equally. The benefits of a reduced subsidy for home ownership are clear.  But we cannot move toward this model until the housing market is stabilized and housing prices are likely to rise.

Mortgage Interest Deduction