Three takeaways from last night's debate in Denver:
1. Romney's performance was great. Better than anyone expected and better than any Republican hoped.
2. Obama's performance was abysmal. Worse than anyone expected and worse than any Republican hoped.
3. Romney's numbers still don't add up, and simply repeating something doesn't make it true.
Romney's plan of cutting every tax rate by 20% and paying for it by eliminating loopholes on top earners can only blow a hole in the deficiet the size of the Grand Canyon.
This is not new. The Tax Policy Center looked at Romney's proposal and even when making all assumptions most favorable to Romney -- including economic growth --
the policy only remains revenue neutral when all tax deductions are stripped from working class families. (A pdf of their report is here). I discuss the report here.
This chart, taken from the TPC report, explains the impact.
You may click on the image to enlarge it for easier viewing.
Bottom line: Romney's plan only remains revenue neutral when families earning less than $200,000 pay more in income taxes as a result of the lost deductions. A handy side effect for the wealthy and very wealthy, i.e. Romney, will pay significantly less because the reduced rate more than offsets the loss of the deductions.
In the end, Congress will not remove the deductions from the working class, and like every Repubican tax cut from Ronald Reagan's through G.W. Bush, we will blow an additional trillion dollar hole in the deficit, in this case, a $5TRILLION DOLLAR HOLE.
Did Romney's refusal to acknowledge this truth, and Obama's impotent attempt to call him out on this lie turn the campaign around? Well. we are about to find out, but my advice to Republicans is, don't hold you breath.
In 2004 John Kerry dominated the debates with Bush who often looked confused and uninformed, and Bush won reelection.
UPDATE: In last night's debate, Romney said "5 other studies" contra the Tax Policy Center's analysis and agree with him. That's not true. The Washington Post, Salon, and Politifact all say this claim is false because these so-called studies are not studies at all, but articles written from conservative hacks that simply deny the math. One was a WSJ article
from Martin Feldstein, an economist and an adviser to the Romney
campaign; one was from Harvey Rosen, an economist at the Griswold
Center for Economic Policy Studies at Princeton University; one was by
Matt Jensen, an economist with the American Enterprise Institute, a
conservative think tank; and two were WSJ editorials,” Politifact explains.