The Great Debate Megathread! Black Lincoln versus whiter, richer Douglas!

[Admiral Yi]

One other thing:  the concept of simplifying the tax code, and the concept of putting in more caps in the tax code, are kind of contradictory.  Caps create all sorts of discontinuities, and discontinuities are exactly the things that makes things very not simple to analyze.

Who said anything about simplifying the tax code?  The Romney/Ryan (modified) plan called for lowering tax rates and offsetting that with elimination of "loopholes" so that the plan would be revenue-neutral.  Democrats have been complaining for months (with good reason) that the plan was very short on specifics about what loopholes would be cut.  Here he puts something specific on the table and guys get so freaked out you start to make up objections.

The US tax code is chock-full of discontinuities.  Tax brackets, estate tax waivers, IRA limits, etc.

[DGuller]

I am not making up an objection.  I'm saying that caps are fucking stupid.  As for simplifying the tax code, I can't be assed to point to the source, but I was under impression that it was Mitt's soundbite as to how he would get more tax revenue.

[CountDeMoney]

OK, from Bloomberg BidnessWeek

Mitt Romney's idea for capping individuals' tax deductions at $17,000 would impose a burden that would fall hardest on the wealthiest taxpayers, who make the most use of the breaks.

The Republican presidential nominee suggested the idea of capping deductions this week as an option to help pay for his proposed 20 percent cut in income tax rates and elimination of the alternative minimum tax. The cap would be one piece of a three-part concept for broadening the tax base, said a campaign aide, who spoke on condition of anonymity to discuss the policy options in more detail.

"This is targeting high-income people and would hit them pretty hard," said Roberton Williams, a senior fellow at the nonpartisan Tax Policy Center in Washington.

The effects of such an idea would vary greatly depending on details that Romney didn't include when he floated it. He didn't say how such an idea might apply to tax breaks that aren't deductions, such as the child tax credit and the exclusion of employer-provided health insurance. He also didn't say whether the $17,000 cap would apply per individual or per married couple.

The aide said today that the deduction ceiling would be part of a three-pronged set of limits on tax breaks. The $17,000 cap would include deductions and credits, said the aide. Among the undecided issues is how to handle the fact that a $1,000 credit, which is a subtraction from a tax bill, is different from a $1,000 deduction, which is a subtraction from income.

Three Caps

A second ceiling would apply to personal exemptions and a third cap would apply to the health-care exclusion.

The amount and details of the limits could be changed to meet Romney's targets for revenue and distribution of the tax burden. The aide emphasized that the three-cap idea is only one option being considered.

Romney and President Barack Obama are holding the first of their three debates today in Denver.

"Governor Romney's tax reform plan will jump-start economic growth, cut the tax burden on the middle class, and lower tax rates across-the-board," Amanda Henneberg, a spokeswoman for the campaign, said in a statement. "He will pursue revenue and distributional-neutrality in reforming the tax code. There are a range of policy options, Governor Romney referenced one illustrative example, to achieve these goals."

Ben Ginsberg, Romney's campaign legal counsel, said at a Politico Live 2012 debate event in Denver that Romney will provide more details "in the next five weeks."

Tax Burden

By itself, a deduction cap probably wouldn't raise enough money to offset the cost of the tax-rate cuts Romney is proposing and prevent the tax burden from shifting from top earners to others.

In an August paper, the Tax Policy Center found that almost all tax breaks for annual income exceeding $200,000 would have to be eliminated to offset the rate cuts for that group.

Romney's deduction cap alone would fall short of that mark, because it would allow some itemized deductions. Romney said there could be a lower cap on deductions for higher-income households.

"This by itself will not solve the problem," Williams said.

For individual tax filers, the effect would differ depending on their financial situations. The heaviest users of tax breaks would pay more. Others would benefit more from the rate cuts.

The largest deductions in the current tax code are those for charitable contributions, home-mortgage interest and state and local taxes.

Limiting Benefits

Capping the total of itemized deductions would effectively limit the benefits of those tax breaks. The standard deduction, used by tax filers whose deductions don't exceed that level, is $11,900 for a married couple in 2012.

Romney's idea echoes a proposal from Martin Feldstein, a Harvard University economist who advises him. Feldstein has proposed capping deductions not at a flat dollar amount but as a percentage of adjusted gross income.

Only about 30 percent of taxpayers itemize their deductions, according to the Tax Policy Center, and they are concentrated in the higher income groups. About 80 percent of the benefits of deductions go to the top 20 percent of taxpayers, and about one-quarter of the benefits go to the top 1 percent, Williams said.

Including the health insurance exclusion in the proposal would change it significantly, because those benefits aren't part of income now, and that break is enjoyed by many in the middle class.

Obama Proposal

Obama proposed caps on itemized deductions paired with tax rate increases, not rate cuts. Obama's plan would limit the benefits of deductions, credits and other tax breaks of individuals making more than $200,000 and married couples making more than $250,000 to a 28 percent rate. That plan hasn't advanced in Congress.

The Obama campaign said Romney's suggestion of a cap on deductions means he would constrain tax breaks used by millions of middle-income Americans.

"Many families deduct much more than $17,000 now," the campaign said in a release on its website.

It cited Internal Revenue Service statistics that show in 2009 more than 6 million taxpayers with an adjusted gross income of between $75,000 and $100,000 had deductions for mortgages, state and local taxes and charitable giving averaging $17,328. There were 9.7 million taxpayers with incomes between $100,000 and $200,000 who deducted an average of $28,999 for mortgage interest alone, according to the campaign.

Limiting the effect on those families " would simply mean that Romney would be farther away from paying for his tax cuts," the campaign said.

[Neil]

There is a fair amount of literature regarding how law schools became more tolerable places once Female students and then professors came on the scene - they were simply unwilling to put up with the kind of bs males were willing to put up with and dish out all those years in the absence of females.

Take that example and multiply it across society.

I'm pretty sure that American society has included females since its inception.

[Sheilbh]

Based on Maggie, Golda and Indira I kind of admire and fear successful female politicians.

What about Sarah? (Palin)

Alas, not successful enough

[CountDeMoney]

OK, it's almost game time.  I hope Mittens has worked on his zingers, so they actually seem spontaneous and not like he's been practicing them all month.
Starched Mormon millionaires don't do canned humor well, you know.

[Kleves]

Obama won the handshake.

[CountDeMoney]

Obama wins the Necktie Match-Up immediately.  Nice and complimentary to the background, solid, subdued.

Mittens did good going with red, but never should've worn stripes.

[Kleves]

Are we really saving money on "two wars" if we're just going to immediately spend that money elsewhere? 

[lustindarkness]

Romney made a funny.

[Sheilbh]

I thought this from James Fallows is good:
http://www.theatlantic.com/magazine/archive/2012/09/slugfest/309063/?single_page=true

I agree on Romney's tie.

So far my bullshit count is Romney - 1, Obama - 1.

[CountDeMoney]

Romney made a funny.

At least his make-up is better tonight, and not the Univision "Montalban" look.

[Sheilbh]

God I hate debates in front of audiences when the audiences can't behave like an audience.  Let them shout, cheer and jeer - let them, for once in their lives, behave with the tasteless wild abandon of Congress.

[Admiral Yi]

God I hate debates in front of audiences when the audiences can't behave like an audience.  Let them shout, cheer and jeer - let them, for once in their lives, behave with the tasteless wild abandon of Congress.

No way.  It would turn into a non-stop applause-athon.

[Baron von Schtinkenbutt]

For your reference: