My bottom line is that all government "subsidies" are the result of political processes. My thoughts:
Middle Class Suburbia - Huston55, I'm not exactly following your logic. FHA loans, etc. are fully available to urbians. I think you are really talking about ownership versus rental.
Mortgage/home ownership - my issue here is that our landlords (a few of which are here) get a break because interest is a business expense for them. It seems to me that the mortgage deduction is simply equalizing with rental properties so borrowing money to purchase real estate is treated the same in both cases. Otherwise rentals would be subsidized and ownership discouraged. And owners don't get to "deduct" maintenance and repairs like rental properties do!
Children - I've always looked at school taxes two ways. One is that you are simply reimbursing society for
your own education. Or you are contributing to educating the future taxpayer who will support you (and not be a vagrant/vandal/criminal).
Religion - I'm a believer in the First Amendment (and all the others too!) but agree that there are issues with how churches (especially megachurches) and contributions to them are handled in the tax code. I kind of like the discussion here about 503(c) charitable works being exempt. But I worry that our politicians would try to influence religion through the tax code.
Agriculture - I agree that political giveaways like farm subsidies/price supports should go (though say Federal crop insurance might be reasonable). I'm kind of surprised that they have held on this long, farm political power is a fraction of what it was. But then there is Iowa in the primaries...
Corporate - This one generates a ton of confusion. I'll start out with saying that IMO corporate income tax rate should be zero. As I've said before, corporations do not
pay taxes. They only
collect them from customers, owners or employees (there is no other source)
and remit them to the government. It is much better to collect taxes directly from those people (aka voters, aka taxpayers). Hiding taxes from voters (corporate taxes, excise taxes, tariffs, VAT) is what politicians love to do.
As an aside, a lot of the confusion I see comes from people thinking corporate income tax is similar to personal income tax. It is not. For tax purposes corporate "income" is actually profit, or revenue minus expenses, while personal income is, for all practical purposes, just revenue from which you get some politically negotiated deductions. A lot of what are called subsidies are various arcane rules defining expenses, which are necessary when you are taxing revenue-expenses. If personal income taxes were like corporate income taxes you would only pay on your savings.
So in my world corporate
income tax would be zero, dividends would be ordinary income, capital gains would be ordinary income indexed to inflation, paying employee health insurance would be neutral tax-wise to the corporation and employee (vice paying it as salary), the government would not be penalizing profitable companies / subsidizing money-losing companies, and about a million rules about business expenses (not "deductions" btw, that is a personal income tax term) would go away as would all the political payoffs surrounding them.
If we must tax the economic activity of corporations, I'm more in favor of a gross receipts tax. Corporate receipts/revenue is much less subject to financial and political shenanigans than income; it gets the government out of the winners/losers game that profit-based tax entails; and the actual rate could be very low - in my estimation maybe 1% to replace existing corporate income tax revenue. The whole "what is a legit business expense" and Schedule C wouldn't go away, you would still need to translate corporate income to the owners' personal tax returns. But it would be a start.
Oh, and I want my ACA subsidy next year