I've casually asked a few questions to my friends and family about where our money comes from here in the US. It's so clear that they have no idea, old ideas, or myths about our monetary system. It is a big, complicated situation and thinking about it too much makes them very uneasy, because they feel powerless and vulnerable enough already. I'm sure I don't understand it all, either, but I've come to appreciate that federal budgets, money, taxes, debts and deficits are not as I learned about them in high school in the 1970s!
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You're right. People don't want to think about this a lot so they end making up all kinds of myths in their heads that are based on logic and some stuff they've heard before
It's amazing. I paid off my first house when I was 28 and the interest rate was 11% (I bought a really cheap, busted-up house in the 1980s). My dad said, why don't you take longer so you can deduct your mortgage interest payment from your taxes? I said, well, a mortgage deduction is subtracted from my gross income, not my final tax bill. And at my tax rate, that's only saves me 20%, at most, of what I would be paying to the bank. Why would I want to pay the bank more, just to reduce what goes to the government? He did the math and paid off his house within 2 months. The value of a home mortgage interest deduction is so embedded in myth that people don't even question it.