Perhaps the most intriguing moment of the second presidential debate came late in the contest when a rock-ribbed undecided voter asked both candidates, "What do you believe is the biggest misperception that the American people have about you as a man and a candidate?" And really, this is the sort of compelling inquiry that makes these contrived town hall-style debates so worthwhile.

President Barack Obama began his answer with a strong statement: "I believe that the free enterprise system is the greatest engine of prosperity the world's ever known." I have no doubt that Obama believes he believes in free enterprise—except in the case of health care policy, the auto industry, the housing market, education, banking, job creation, manufacturing, green energy and so on and so forth.

Basically, the genius of free enterprise must never be applied to anything that's too important in our lives. When it is, naturally, it must be applied "fairly."

But it's fair to say that undecideds—as is their nature—may have been confused. After all, someone who deems the free enterprise system the greatest engine of prosperity ever in the galaxy typically wouldn't spend four years arguing that job creation springs from government spending. And granted, not many true believers of capitalism—our president excluded—denigrate profit motives and wealth with such elan.

If you believed the free enterprise system is the mechanism of great prosperity, your crowning achievement might not be legislation that constricts competition in health care, layers it generously with regulations, institutes effective price controls, coerces participation and sets up a government board to mete out advice on rationing.

Put it this way: Folks who admire free enterprise seldom spend two months bashing private equity to kick off a re-election campaign for president.

Those who believe that free enterprise is the gold standard of economic policy may even support allowing our failing education system to participate so that parents and kids can enjoy some choice and competition. A free market enthusiast might not nationalize all student loans.

One suspects that a real fan of free enterprise wouldn't refer to a little competition in Medicare as "radical," and he probably wouldn't consider a plan that allows Americans a small choice of how to invest their Social Security dollars (a choice that might bring them back more than that 1 percent return on the dollar) extreme.

Folks who believe that the free enterprise system is tops might argue that poorly run, out-of-touch companies should fail so other, healthier companies can move in and create self-sustaining jobs. They would also probably avoid scaremongering about "outsourcing," because doing so often helps create better-paying and more productive jobs here in America. (Though, in fairness, the president's certainly not alone on this one.)

If you trust that the free enterprise system is the greatest engine of prosperity, you understand that one person's wealth and success don't deprive anyone of his own.

Merriam-Webster defines "free enterprise" as "freedom of private business to organize and operate for profit in a competitive system without interference by government beyond regulation necessary to protect public interest and keep the national economy in balance." If Obama believes that he's instituted and supported economic policy that comports with that description, he's more confused than the average town hall participant.