Presidential debate: Lots of red meat for policy wonks

Was it the natural tendency of old campaigners to play it safe in the opening quarter? Or the tendency of longtime adversaries to score points off each other rather than illuminate their differences?

Or was it that the issues on which the presidential campaign will turn are so complicated — the economy, taxation, healthcare — that it’s a challenge for anyone to make them accessible for average listeners?

Whatever the reason, Wednesday night’s initial debate between President Obama and his Republican challenger, Mitt Romney, provided red meat for wonks, but perhaps not so much for voters.

Transcript: Read the arguments

So here’s a quick decoding of some of the candidates’ points. Let’s start with taxation.

Romney has proposed cutting all marginal personal income tax rates by one-fifth — the top rate would come down to 28% from 35% — and making up the huge revenue loss by eliminating loopholes and tax breaks. He’s pledged that the share of the personal income tax paid by the wealthy wouldn’t diminish, but that taxes wouldn’t rise on the middle class either.

Obama’s main thrust against Romney was that the numbers of his tax plan don’t add up. Given the lowering of tax rates, he said, “it is not possible to come up with enough deductions and loopholes that only affect high-income individuals to avoid either raising the deficit or burdening the middle class. It’s math. It’s arithmetic.”

Romney’s riposte: “Virtually everything he just said about my tax plan is inaccurate.”

Obama’s analysis plainly was drawn from work by the Tax Policy Center, a think tank operated by the Brookings institution and the Urban Institute. The center observes that any tax plan that meets Romney’s specifications — the cut in rates, preservation of investment incentives such as low capital gains rates, elimination of the alternative minimum tax and estate tax, and “revenue neutrality” (that is, no overall increase or decrease in tax revenue) — would necessarily mean higher taxes for all taxpayers earning less than $200,000.

Its analysts said they couldn’t fully analyze the proposal because Romney hadn’t explained which loopholes he would eliminate or how. He still hasn’t, and didn’t do so during the debate — beyond repeating a recently unveiled suggestion that every taxpayer might be granted a lump sum maximum in deductions; the figure would diminish for high-income taxpayers.

PHOTOS: Memorable presidential debate moments

The candidates predictably sparred over the impact of “Obamacare,” the healthcare reform program enacted in 2010. Romney, who signed an almost identical bill as governor of Massachusetts, continues to insist that it has worked well in that state but can’t be a model on the national level. But he didn’t explain why it shouldn’t work nationwide, except by invoking state’s rights.

Romney repeated his campaign claim that Obamacare cuts $716 billion from Medicare. It’s highly misleading for two reasons. One is that it’s incorrect to suggest it’s a cut in current benefits; in truth, it’s a reduction in future reimbursements to doctors and hospitals, compared with what they would receive under prior law. The other reason is that the budget plan promoted by Romney’s running mate, Rep. Paul D. Ryan, includes the exact same provision — a fact that Obama, unaccountably, failed to point out.

Obama’s obscure reference to a 30% cut proposed by his Republican challenger in Medicaid, a federal-state program mostly serving the indigent and aged, applies to a provision of the Ryan budget plan, endorsed by the Romney campaign, to convert Medicaid to a block grant to states to spend as they wish. The grant would rise along with the growth in the U.S. economy plus one-half of 1%.

But because healthcare costs rise faster than that, congressional budget analysts say the shortfall would reach 34% by the 10th year of the change. The Republican program leaves the task of dealing with that gap to state governors, adding to their budget burdens.

Finally, one remark by Obama undoubtedly raised the hackles of Social Security advocates: his assertion that although Social Security is “structurally sound,” it will need to be “tweaked the way it was by Ronald Reagan and Democratic Speaker Tip O’Neill” in the 1980s. At that time the retirement age was raised modestly and the payroll tax increased significantly. “Tweaks” can cover a lot of things, including changes in inflation adjustments and in retirement ages, that add up to benefit cuts for millions of recipients. To Social Security experts who believe Obama’s commitment to the program may be less than absolute, that wasn’t a comforting moment.

PHOTOS: Scenes from the first presidential debate

mhiltzik@latimes.com

Twitter: @latimeshiltzik

Michael Hiltzik’s column appears Sundays and Wednesdays in the Business section of The Times.