Here's the exchange of the night, coming right after Romney tried to score a point by claiming that it took Obama two weeks before he referred to the Benghazi attack as an act of terror:

ROMNEY: I think it's interesting the president just said something, which — which is that on the day after the attack he went into the Rose Garden and said that this was an act of terror.

OBAMA: That’s what I said.

ROMNEY: You said in the Rose Garden the day after the attack, it was an act of terror? It was not a spontaneous demonstration, is that what you’re saying?

OBAMA: Please proceed governor.

ROMNEY: I want to make sure we get that for the record because it took the president 14 days before he called the attack in Benghazi an act of terror.

OBAMA: Get the transcript.

CROWLEY: He did in fact, sir. So let me — let me call it an act of terror....

OBAMA: Can you say that a little louder, Candy?

Obama played this really, really well. He let Romney dig himself into an ever deeper hole, and just smiled when Romney tried to get him to directly deny it. This turned out to be either lucky or smart, because it gave Candy Crowley a chance to fact check Romney and confirm that she was there and she heard Obama refer to Benghazi as an act of terror on the very next day. This is going to get a lot of play. It was also a serious own-goal for Romney, who had plenty of strong criticisms available on Libya but ended up overreaching on a very specific charge that was dead wrong. That was dumb.

The CBS insta-poll gives the win to Obama, 37%-30%. CNN's "scientific" poll gives it to Obama, 46%-39%. A Battleground poll of swing states gives Obama a bigger win, 53%-38%. And an online poll by Google Consumer Surveys gave Obama his biggest win of all, 48%-31%.

Maybe the second best moment came when Romney was defending himself against charges that he invested in China: 

ROMNEY: Mr. President, have you looked at your pension?

OBAMA: You know, I don't look at my pension. It’s not as big as yours so it doesn't take as long.

This was a weird moment. The original charge from Obama was a tired attack about Bain Capital investing in companies that specialized in outsourcing, and Obama deserves a ding for that. On the other hand, it had come about five minutes earlier, and it was kind of bizarre that Romney suddenly decided he had forgotten to respond to that and brought it up again out of nowhere. And then it turned around and bit Romney in the ass when Obama got off a pretty good line in response. Just goes to show the value of discipline. Romney should have left well enough alone.

And here was Obama's third-best moment:

So what I’ve said is, your first $250,000 worth of income, no change. And that means 98 percent of American families, 97 percent of small businesses, they will not see a tax increase. I’m ready to sign that bill right now. The only reason it’s not happening is because Governor Romney’s allies in Congress have held the 98 percent hostage because they want tax breaks for the top 2 percent.

I liked the hostage talk there. But I have no idea whether anyone else liked that passage as much as I did.

Andrew Sullivan, who has spent the past couple of weeks in wrist-slitting mode, is now thrilled: "To my mind, Obama dominated Romney tonight in every single way: in substance, manner, style, and personal appeal. He came back like a lethal, but restrained predator. He was able to defend his own record, think swiftly on his feet, and his Benghazi answer was superb. He behaved like a president. He owned the presidency. And Romney? Well, he has no answers on the math question and was exposed. He was vulnerable on every social issue, especially immigration. And he had no real answer to the question of how he'd be different than George W Bush."

A lethal but restrained predator!

Apparently, "binder full of women" is the Twitter and Facebook catchphrase of the night. This is a reference to Romney's claim that when he became governor of Massachusetts and put together a cabinet, "I went to a number of women's groups and said, 'Can you help us find folks,' and they brought us whole binders full of women." This entire passage struck me as vaguely patronizing at the time, though I confess that when I re-read it in transcript form it didn't seem so bad. Maybe it was something in Romney's tone, which seemed a little false in a "some of my best friends are black" kind of way.

UPDATE: Now I remember the lines that struck me as patronizing. First Romney admitted that his entire staff was initially unable to find any qualified women to work in his administration. Then, a little later, he said this: "We’re going to have to have employers in the new economy, in the economy I’m going to bring to play, that are going to be so anxious to get good workers they’re going to be anxious to hire women." I don't think Romney meant anything patronizing here, but it was unfortunate wording nonetheless. It implies that employers will only hire women once the economy gets strong enough that they're desperate to hire just about anyone.

UPDATE 2: Apparently the "binder" comment isn't even true. David Bernstein explains:

What actually happened was that in 2002 — prior to the election, not even knowing yet whether it would be a Republican or Democratic administration — a bipartisan group of women in Massachusetts formed MassGAP to address the problem of few women in senior leadership positions in state government. There were more than 40 organizations involved with the Massachusetts Women's Political Caucus (also bipartisan) as the lead sponsor.

They did the research and put together the binder full of women qualified for all the different cabinet positions, agency heads, and authorities and commissions. They presented this binder to Governor Romney when he was elected.

....Note that in Romney's story as he tells it, this man who had led and consulted for businesses for 25 years didn't know any qualified women, or know where to find any qualified women. So what does that say?

Sheesh. Romney is just constitutionally programmed to deceive, isn't he? And all in service of a point that probably won him no favors with women anyway.

Andrew Sprung thinks Obama saved the best for last: "Lord-a-mercy, Obama just killed Romney on the 47%. Was it genius, or luck that he saved it for the end, when there was no time for rebuttal?" Here's what Obama said:

I believe Governor Romney is a good man. Loves his family, cares about his faith. But I also believe that when he said behind closed doors that 47 percent of the country considered themselves victims who refuse personal responsibility, think about who he was talking about. Folks on Social Security who’ve worked all their lives. Veterans who’ve sacrificed for this country. Students who are out there trying to hopefully advance their own dreams, but also this country’s dreams. Soldiers who are overseas fighting for us right now. People who are working hard every day, paying payroll tax, gas taxes, but don’t make enough income.

Obama is stealing a Romney riff here. Romney is fond of saying that Obama is a good man, but in over his head. Obama turned this around, saying that Romney is a good man, but only cares about the rich guys he's spent his life hanging around.

James Joyner thinks Obama won the debate, but: "Overall, even if the debate is a draw, it’s a minor win for Obama simply because it stops the bleeding from Round 1." That's probably true.

Ed Kilgore: "Imaginative Romney effort to make 'self-deportation' sound like defense of immigrants' autonomy. Didn't work." Yeah, that was definitely a nice try, but still pretty lame. Here was Romney's quote: "Self-deportation says, let people make their own choice. What I was saying is, we’re not going to round up 12 million people, undocumented illegals, and take them out of the nation. Instead let people make their own choice." I doubt that this cut any ice with anyone, though the truth is that "self-deportation" is (a) genuinely moderate compared to the Republican Party mainstream, and (b) not really very different from the policy Obama has followed for the past four years.

By the way, the big loser tonight was climate change. Neither candidate mentioned it, but they practically fell all over each other to declare their love for coal and fracking and drilling for oil on federal land. Yuck.

WRAP-UP: Well, that was like night and day, wasn't it? Obama was way crisper than he was two weeks ago, and he adopted Joe Biden's habit of frequently interrupting to accuse Romney of getting his facts wrong. On several occasions, Obama warned viewers that the Romney of the primaries was not the same Romney on display tonight, and that they should believe the old Romney, not the fake new one. I thought this worked pretty well, but then, I would, wouldn't I? Transcript here.

For my money, the worst moment of the night for Romney came on Libya. He hauled out a stale conservative talking point about Obama not calling the Benghazi attack an act of terror, and when he confronted Obama about it, Obama just smiled and let him hang. Unexpectedly, this flustered Romney. Then, a few seconds later, Candy Crowley interrupted to confirm that Obama did, in fact, call it a terror attack the very next day. That really flustered Romney. This is the kind of segment that ends up getting repeated on cable news over and over and over.

Obama had a pretty good line early on about Romney's economic views: "Governor Romney doesn't have a five-point plan, he has a one-point plan. And that plan is to make sure that folks at the top play by a different set of rules. That’s been his philosophy in the private sector, that’s been his philosophy as governor, that’s been his philosophy as a presidential candidate." I wish Obama had had a chance to hammer that a little harder, but it never really came up again until the very end.

On taxes, Romney has talked before about the idea of capping deductions rather than eliminating them, but this was by far the most public forum in which he's mentioned it. For all practical purposes, I think that makes this the official Romney position: A 20% across-the-board rate cut paired with a $25,000 maximum for itemized deductions. The math on that comes nowhere close to working, though, and it's pretty easy to prove it. I wonder how long it will be before the Romney campaign backpedals on this?

Obama did a good job of hitting Romney on his tax plan, taking it slowly and all but accusing him of deliberately trying to deceive middle-class voters. It's hard to know if this made a dent, though. Too many numbers just puts people to sleep.

Oddly enough, I think both candidates did better tonight than two weeks ago. Obama was, obviously, way better. I'd give him an A-. But Romney was better too. I'd probably give him a good B, maybe even a B+ if I were feeling generous. I don't know how much the first debate really affected the polls, but if it did, this one ought to correct at least some of the damage.

Obama's the underdog! The fate of Western civilization rests on his debating skillz! Let the liveblogging commence....

10: 39 - And that's a wrap.

10:32 - Obama answer on China is getting kind of wonky.

10:26 - Question for Romney about outsourcing to China. I hope Obama doesn't repeat his "Romney invested in Chinese outsourcers" wheeze when he gets his rebuttal.

10:24 - Everybody agrees on importance of parents! Hooray!

10:23 - Now Candy Crowley asks Romney why he changed his mind on assault weapon ban. Ouch.

10: 22 - Romney playing to the base with Fast & Furious nonsense.

10:20 - In the end, however, Obama mildly in favor of renewing the assault weapon ban. Romney flatly opposed.

10:18 - A gun question. Obama playing it right down the middle.

10:17 - Romney flustered when Obama refuses to answer him. Then Candy Crowley fact checks Romney in real time! Crowd claps! This might be the highlight of the debate.

10:14 - Obama offended at suggestion that his diplomatic team might be playing politics with attacks. Pretty good response.

10:13 - Romney is dissing Obama for attending a fundraiser the day after the Benghazi attack? That's pathetic.

10:12 - This is pretty much the first real foreign policy question, isn't it?

10:11 - Question: who screwed up security in Benghazi? Obama: We'll get back to you.

10:07 - Crowley now getting annoyed. Obama getting into a tiff over rules. I don't think that works, no matter how justified.

10:05 - OK, now Romney switches to "self deportation." His explanation: "Let people make their own choice." Sounds so cuddly!

10:04 - Romney just totally blows off Candy Crowley when she tries to ask a followup.

10:02 - Obama has a very nice, crisp answer on immigration.

9:59 - Romney pretty tough on illegal immigration. No more Moderate Mitt. I guess focus groups showed that this was a winning position.

9:56 - Romney pretty crisp when attacking Obama's first term. Both guys actually seem more comfortable arguing over past four years than upcoming four years.

9:53 - Obama on Romney and the GOP Congress: "He said 'Me too.'" Repeated over and over. Decent line.

9:51 - Obama is in his wheelhouse defending his past four years. Not sure that will get the job done, though.

9:49 - Maybe I missed something. I thought the Bush question was about wars etc., but maybe I misheard.

9:48 - Wait. "I came through small business"? Is Romney talking about Bain Capital?

9:46 - "What is the biggest difference between you and George W. Bush?" Question is about foreign policy, but Romney just goes back to his five-point plan. Totally evading the question.

9:41 - Romney's answer about women seemed vaguely condescending to me. Wonder if it came off that way to anyone else?

9:37 - Crowley cuts off tax discussion just as it starts to get interesting. Of course, not everyone might think tax discussions are as interesting as I do.

9:34 - Obama now getting a little too deep in the weeds. But  decent attack anyway. Romney responds on his tax numbers: "Well of course they add up." Then pivots away instantly.

9:32 - Obama calling out Romney on deductions. Good attack, but will it work?

9:29 - Hostage talk from Obama. Excellent.

9:26 - Ah. Romney going public on the idea of capping deductions, this time at $25,000. Math still doesn't work, but this is now getting close to being his official position. Also, really doubling down on not cutting taxes for the rich.

9:19 - Conservatives sure are obsessed with drilling on federal land.

9:16 - Trying to paint Romney as anti-coal probably not a good idea, especially after accusing him of being Mr. Coal.

9:15 - "Moderate Mitt" is back. He loves renewable energy!

9:14 - Obama hammering on green energy. Good.

9:11 - Romney is right that Obama took GM through bankruptcy. Obama is right that Romney's plan wouldn't have worked. Obama: "Governor Romney doesn't have a 5-point plan, he has a one-point plan." Good line.

9:09 - Romney trying to pretend "real" unemployment rate is 10.7%. Spare me.

9:07 - Obama going with a numbered list for his jobs plan. Good move. Then a shift to taxes.

9:03 - Romney seems to have sat down on his barstool OK. Whew!

8:59 - Here's hoping that Candy Crowley ignores all the weird rules the campaigns insisted on during pre-debate negotiations.

Andrew Sullivan continues to freak out:

Here's a dishhead bleg: when was the last time that a sitting president in a re-election campaign lost six percentage points in the polls in two weeks in October?

That's pretty specific, and I suppose the answer is "never." But let's change the question: When was the last time Barack Obama lost six percentage points to a Republican challenger?

Pete Souza/The White House/FlickrPete Souza/The White House/FlickrAnswer: 2008. On September 1st, Obama led John McCain by 6.4 points. On September 10th, McCain led Obama by 2.5 points. That's a swing of 8.9 points. But when the election was actually held, Obama won by 5 points.

Look: Polls change. That's politics. Beyond that, though, there are a couple of specific reasons everyone should settle down a bit. First, the fundamentals have always suggested that this would be a close election. The consensus of the political science models is an Obama win by maybe 2 points or so. Second, I'm increasingly convinced that a couple of years from now some enterprising political scientist will write a paper thoroughly debunking the idea that Obama's debate performance was as horrible as everyone is making it out to be. Instead, the recent poll changes will come down to three things:

  • A late September surge by Romney for reasons that are (at the moment) still a bit of mystery.
  • Reversion to the mean. Obama was never going to win the election by 5 or 6 points, and his recent drop has been baked into the cake for a long time. His big lead was mostly an artifact of stupid mistakes by Romney, and eventually Romney recovered from them.
  • The media freakout over Obama's debate demeanor.

Obama didn't turn in a great debate performance, but it was nowhere near bad enough to account for the kind of poll declines we've seen over the past couple of weeks. That's my two cents, anyway.

Earlier this morning Stephanie Mencimer asked, "Could Bush v. Gore Save Obama in Ohio?" You see, Ohio's Republican legislature had ended early voting for everyone except active duty military and the Obama administration had taken them to court, arguing that if soldiers got to vote early, then everyone should get to vote early:

The Obama campaign challenged the move, and in August, a federal judge agreed that Ohio had violated the Constitution's Equal Protection Clause by allowing some people to vote early but not others. In early October, the Sixth Circuit Court of Appeals upheld the decision and ordered Ohio to keep the polls open for the weekend for everyone if they do it for the military and overseas voters. The state has filed an emergency petition with the Supreme Court to overturn the order. The Obama campaign, naturally, is opposed, and has filed a brief arguing that Bush v. Gore demands that the court protect the integrity of the voting process.

....As a result, the court now will have to prove whether it was serious or simply partisan when it sided with Republicans by declaring that "[t]he right to vote is protected in more than the initial allocation of the franchise. Equal protection applies as well to the manner of its exercise."

So how did that turn out? A few minutes ago we got the answer:

The United States Supreme Court has given the green light to early voting in Ohio in the three days prior to November's election. The brief, one sentence order from the court Tuesday is a setback for Republican leaders in the state, who had asked the justices to step in and allow pending restrictions to take effect.

Ohio will appeal the ruling, but that takes time and won't affect this year's election. For now, Bush v. Gore has finally handed a small victory to Democrats. That's good news for Obama in a state where he's started to turn things around and needs all the help he can get.

UPDATE: Ari Berman points out that although the same rules now apply to everyone, Ohio Secretary of State Jon Husted is limiting early voting hours for the three days prior to the election. The Supreme Court's ruling is good news for Obama, but Ohio Republicans are still doing their best to limit access to the polls.

In today's edition of ridiculous time wasters, we bring you a bout between heavyweight contender Mitt Romney and referee wannabe Glenn Kessler of the Washington Post. The question at hand: how should we rate Romney's contention that he has three studies verifying that his five-point economic plan would create 12 million jobs?

The winner is....Kessler, of course. Romney has always said that he'd create 12 million jobs in four years, but the studies in question (a) use timeframes of 8-10 years, and (b) don't evaluate his plan anyway. Four Pinocchios for Romney!

The loser is....all of us who still have functioning brain cells — including Kessler, who was forced to spend precious hours of his life on this nonsense that no one at Romney HQ even pretends to believe in the first place. But the rest of us still have to go along with the gag. Presidential candidates these days can literally say anything they want, and we're all required to stroke our chins and pretend to take them seriously.

In any case, the real answer to this question is a lot simpler: if elected, Romney probably will create 12 million jobs in his first term. So would Obama. So would my cat. And we don't need any studies to prove it. If the economy grows at about 3-4% for the next four years, we'll add 12 million new jobs, and there's a pretty good chance that the economy will indeed grow at about 3-4% for the next four years. We might be coming out of our recession slowly, but we are coming out of it, and this means that 12 million jobs is sort of a no-brainer. It's sort of like promising that unemployment will fall under 7%. It will, of course, but that's a pretty low bar. We should expect better.

Bruce Bartlett writes today that a Romney-style tax reform, where you lower rates and eliminate deductions, is a pretty good idea. In theory, it should produce higher economic growth.

The problem is that when tax rates are within a fairly modest range, the effect is either nonexistent or too small to be noticeable. The table on the right shows what happened after the famous 1986 tax reform, and more rigorous research confirms that it had little effect on growth:

By the mid-1990s, it was the consensus view of economists that the Tax Reform Act of 1986 had little, if any, impact on growth. In an article in the May 1995 issue of the American Economic Review, the Harvard economist Martin Feldstein, a strong supporter of tax reform who had served as chairman of Reagan’s Council of Economic Advisers, found large changes in the composition of income, but the only growth effect was a small increase in the labor supply of married women.

In a comprehensive review of the economic effects of the 1986 tax reform act, in the June 1997 issue of the Journal of Economic Literature, Alan Auerbach of the University of California, Berkeley, and Joel Slemrod, the University of Michigan economist, also found that the primary impact was on the shifting composition of income. They could find no significant growth effects. They concluded, “The aggregate values of labor supply and saving apparently responded very little.”

Even if you assume that Romney could manage to make his tax numbers add up (he can't), and even if you assume his plan has any serious chance of getting through Congress (it doesn't), it wouldn't do much for growth. Rationalizing the tax code might be a good idea, but it's not the answer to an economic downturn. Romney should focus more of his attention on jobs and less on the endless conservative obsession of lowering taxes on the rich at all costs.

In the wake of Hillary Clinton's statement that she bears responsibility for security at U.S. embassies, Blake Hounshell makes a few salient points. Here's #1:

It's a bit rich for all these people to suddenly be arguing that Libya is the most important story in the world after ignoring it for months. It reeks of political opportunism. Did Darrell Issa show any sign that he cared one iota about Libya before the morning of Sept. 12, 2012? Did Mitt Romney?

Nope. I happen to agree with Adam Serwer that Republican investigations into the Benghazi attack are legitimate even if they're politically inspired, but I also agree with him that these particular investigations have been ineffective precisely because they're so transparently partisan. There's just no evidence that Republicans really care about embassy security, only that they want to score some points in the runup to an election.

And here's point #8:

The United States can't turn its diplomatic installations into armed camps. U.S. diplomats are going to need to take risks from time to time, and many of them are fully prepared to so. That said, it seems inevitable that this tragedy is going to have precisely the effect the State Department fears: more restrictions on diplomats' movements, more fortress-like facilities, and less interaction with the locals. American diplomacy will be the worse for it — and that will ultimately make us less safe.

I hope this point gets wide attention. Sometimes stuff happens, but that doesn't inevitably mean that a huge flurry of new rules have to be put in place. Unfortunately, that's usually what happens, and it's usually exactly the wrong thing to do.

The Daily Mail, which has something of a specialty in climate denial, apparently discovered this weekend that Britain's Met Office has updated its long-term global temperature series. This happened several months ago, and the changes from the HadCRUT3 series to the HadCRUT4 series were fairly minor, but I guess anything is a good excuse to rerun one of their oldest wheezes: a colorful chart that starts with the unusual temperature spike of 1997-98 to make it look like global warming has stopped. Here's my version of the chart in their story:

You know the rest of this story, right? It's a noisy data series, and if you choose any other starting point — 1996 or 1999 will do fine — the trendline looks quite different. A chart that includes the entire past century is below, and as you can see, it's easy to find several decade-long plateaus if you cherry pick the data just the right way. But if you look at the entire series, it's pretty obvious that the world is still heating up. Be sure to let your Daily Mail-loving friends know.

BONUS CHART: If you want to see all the other times that global warming has "stopped" during the past century, just click here and scroll down.

The New York Times reports that high frequency trading is on the decline:

Profits from high-speed trading in American stocks are on track to be, at most, $1.25 billion this year, down 35 percent from last year and 74 percent lower than the peak of about $4.9 billion in 2009....While no official data is kept on employment at the high-speed firms, interviews with more than a dozen industry participants suggest that firms large and small have been cutting staff, and in some cases have shut down.

The usual wheeze to justify HFT is that it provides greater liquidity, which benefits even small traders. But the stock market had always had plenty of liquidity. It's a textbook model of liquidity. So there's really not much upside there, and the downside is that no one truly understands what all the HFT algobots are doing. Maybe they're harmless. Then again, maybe they only seem harmless when markets are calm. But when things get a little out of whack — in other words, at the worst possible time — there's no telling what the algobots will do. Their programmers certainly don't, and that's reason enough to think we should be pretty careful with this stuff.

But Felix Salmon highlights another reason we should keep HFT on a short leash. It turns out that HFT algobots don't actually do that much trading. What they do is produce massive amounts of financial spam: putting out buy and sell orders and then rescinding them almost instantly. In other words, quote stuffing and market spoofing. And the target of all this fake trading is....other algobots:

Call it the Stalemate of the Spambots: the HFT algos are all so sophisticated, now, that they just ping each other with order spam, rather than actually trading shares. Naturally, if you don’t trade shares, you can’t make money. But at the same time, anybody who does trade shares risks getting picked off by the very algorithms which are increasingly circling each other like prizefighters who never land a punch.

All of which is to say that just because HFT algobots aren’t trading as much any more, doesn’t mean that the waters are any safer for real-money accounts to re-enter. Indeed, the exact opposite is more likely: that the bots have poisoned the stock-trading waters so much that even the bots themselves fear to go in.

Felix thinks the answer is a financial transaction tax. "Let's not assume that rising trading costs are always and necessarily a bad thing," he says. I agree. CEPR has more here.

Paul Waldman has some advice for President Obama in tomorrow's debate:

I realize there's at least some chance that the President is too busy to be reading this blog today. But just in case, let me offer a suggestion. What Obama needs is a set of responses that cover the topic at hand, but that all follow a single theme. He needs, to put it bluntly, a single phrase that he will repeat every time he's refuting a Romney falsehood. It could be something slogan-y, like "That's another Romney Reinvention," or could be something simple, like "Once again, Governor Romney thinks he can fool you and get away with it."....When Romney lies, what Obama needs viewers to take away from the exchange isn't that there's some dispute about the details of policy, but that Romney is lying.

Sadly, I'm pretty sure Paul is wrong about this. Partly this is because most viewers don't react well to charges of lying. They think it makes the accuser sound distinctly unpresidential. Partly it's because it's not easy to make charges of lying stick. Romney would simply reply with a blizzard of numbers and "studies" that would muddy the waters enough to blunt the attack. Mostly, though, it's because most voters don't care if politicians lie. That includes you.

You should think of presidential campaigns as aspirational, not operational. Voters know perfectly well that presidents don't accomplish most of what they say they will. So, reasonably enough, they don't care much about the details. What they do care about is what candidates believe. In Romney's case, his message is fairly simple. He believes in low taxes; less spending on lazy slackers; social conservatism; getting tough on our enemies overseas; and unleashing the power of business by cutting regulations. And he really does believe all this stuff. He may be evasive or even downright dishonest about the details of his tax cuts or how he'd get tough with Syria and Iran, but most people don't really care. It's enough to know that he really does want to cut taxes and he really does want to get tough with Syria and Iran.

And before you get all huffy about how stupid voters are, keep in mind that this all applies to you too. Most of my readers are liberals. You're planning to vote for Obama. So ask yourself: how much do you care that Obama is sometimes a little less than perfectly accurate about his plans? Not much at all, I'd guess. You either convince yourself that his exaggerations are small ones, or that he's been forced into it by Romney's serial lying, or that if you dig deep enough there are ways of justifying everything he says. In other words, what matters aren't all the arid details. What matters is that Obama believes most of the same things you believe.