The Political Tipster

If you like long-shot bets you’ll love these tips

One of the most consistent themes in the academic literature on betting is that, with traditional bookies at least, the value doesn’t usually lie with the longer odds. There is also the unromatic truth that longer odds bets require better risk management – while odds of 500/1 on an event that should have odds of 99/1 may be good value, you will still lose money 99% of the time.

However, if you are prepared to take a cold hard look at the field one can still find pockets of value. The following (no particular order) are the four best longshots (5% or less):

1. John McCain to win the GOP nomination. McCain’s chance of winning the nomination may be radically diminished from where they were during the start of the summer but he still has the potential to climb back into contention. While he may not realise that he has to get rid of Rick Davis and move back to the centre (without backsliding on Iraq) until it is too late, it is not inconceivable that the recent plunge in polls could persuade him to resurrect the old McCain and stop apologising for the last eight years of his political life. We should also be aware that neither Giuliani nor Thompson are exactly overwhelming candidates, while Romney is toxic to the general electorate. Chances of McCain winning the nomination are 15% while the Intrade price is 4.3-4.5.

2. Colin Powell to win the GOP nomination. If I were a Republican consultant who came from the ‘realist’ wing of the GOP I would be seriously considering starting a campaign to draft Powell. Whether you agree or disagree with his policies, Powell is one of the only Republicans to retain genuine cross party appeal. Although he has been insanely reluctant to enter politics, Barack Obama’s acceptance has demonstated that his fears about an assasination attempt by racists are pretty much unfounded. Probably of Powell winning the nomination is 2%, price on Intrade.com is 0-0.1.

3. Third Party Victory – Although I think that a putative Bloomberg candidacy would be little more than a ‘mid-life crisis in search of a campaign’ (and he has all but ruled himself out in any case) I believe that a McCain/Lieberman ticket remains a strong possibility. An independant candidacy would give McCain room to move to the centre and drop his support for a flat tax/national sales tax). At the same time he would be free to take on Michelle Malkin, Ann Coulter and Lou Dobbs over immigration. The mechanics of it is another post on its own but sufice to say that the chances of a third party victory are about 7% while the price on Intrade.com is 2.1-2.5.

4. Mark Warner to win the Democratic nomination – With the audacity of hype’s campaign imploding and John Edwards and Bill Richardson going nowhere there is room for a candidate who appeals to the South. Warner has the experience, the centrism and the charisma. He might have withdrawn from the race and be more interested in the Senate but that still doesn’t justify the prices that are on offer. Warner’s chances are about 2% while the price on Intrade.com is 0-0.2.

Why Hillary Should be Smiling

Hillary Clinton – She’s still got a solid lead in the polls and all the other positives the she had at the end of July. At the same time Obama’s inexperience is becoming even more obvious, Edwards’ attempt to move to the left (like McCain’s move to the right) is badly backfiring and Bill Richardson is going nowhere. Although she is led by the anemic Mark Penn (who ran Joe Lieberman’s campaign in 2004 into the ground) she has other experience and talented operatives, including the ‘Rajun Cajun’ himself. Although it is extremely early to definitively call this race, barring an entry by either Mark Warner or Al Gore, she seems unassailable. Probability of winning the nomination is 65%. Price on Intrade.com 66.0-66.5 FAIRLY PRICED

Al Gore – Although Gore seems to be uninterested in running and he will need to develop some policies other than the environment, he is the only candidate with the experience and enough support with the base to challenge Hillary. He also has an extremely well organised group of supporters who are determined to draft him into the race, while his connections with technology companies will enable to match Hillary’s funds, if he so wishes. Probability of winning the nomination is 15%. Price on Intrade.com 7.6-7.9 UNDERPRICED

Barack Obama – It would be ludicrous to completely write-off a candidate who is a clear second in the opinion polls and enjoys considerable media support. However, it might be equally ludicrous to expect a person who has little experience beyond some involvement in Illinois local politics and four years in the Senate to deal with the huge economic, social and foreign policy problems that American faces. At best Obama is another Gary Hart, whose main objective will be to leverage this race into either second place in the ticket or frontrunner status in 2012. At worst this campaign has the potential to destroy his credibility for the next cycle. Probability of winning the nomination is 10% Price on Intrade.com 17.9-18 OVERPRICED

Bill Richardson / John Edwards – These two candidates both had the potential to be successful. However, Richardson has come off as extremely lightweight while Edwards has moved from a populist centrist to a far-left centrist (as previously noted John McCain has also made a similar mistake by moving to the right). Poverty, inequality and outsourcing are justifiably important issues. However, while there is room for someone who can address these issues from the centre there is a reason why Walter Mondale lost 49 states in 1984. America wants someone with a bit of populist rage, just not someone who sounds like Howard Dean on steroids. Probability of winning is 4% each.

Mark Warner – If there is one long-shot candidate who could capture the imagination it is Warner. Centrist, charismatic and from the South he was the choice of the ‘smart money’ up until his withdrawal last year. While he will have to do a lot of explaining, the ‘Anyone but Hillary’ movement could do far worse that choose him. Worth a shot at 0.1 on intrade.com.

McCain turned down Bush and Kerry but could (and should) he run with Giuliani?

With John McCain in fourth place in the last three national polls there is increased speculation that a Giuliani-McCain ticket might be in the works. Indeed, the speculation has been fanned by Giuliani declaring that he ‘ happen(s) to be a very big admirer of Sen. McCain and I can tell you quite honestly that if I weren’t running for president I would be here supporting him’. McCain even said that he was ‘very flattered’ by Giuliani’s comments. Like the idea of a Bush-McCain ticket in 2000 and Kerry-McCain in 2004 this seems an appealing ticket on the surface, especially if McCain is too damaged by his past mistakes to recover in time.

However, the reality is that this ticket is simply not going to happen and even if it did it would be a mistake on Giuliani (and McCain’s) part. If the past few months have proved only two things, it is that McCain only does well in the role of straight-talking maverick and that a large segment of the Republican party intensely dislike him. While the Republican ‘base’ might be willing to hold their noses and vote for either Giuliani or McCain to prevent Hillary winning, the prescence of both of them ion the ticket would simply give the Republican base one more reason not to vote for him. At the same time McCain’s adherance to Giuliani’s policies would prevent him from winning the support of independants and force him to flip-flop on this issue of torture.

Indeed, if Giuliani wanted to choose a moderate, and it by no means certain that he would be able to do so, it would be more logical to choose someone like Joseph Lieberman who at least agrees with him on abortion (although there is far more overlap between McCain and Lieberman than between McCain and Giuliani). At the same time, having turned down Bush in 2000 and Kerry in 2004, it is doubtful that McCain would want to spend the last act of his political career on the lower half of a losing campaign. Even if Giuliani managed to win the election, it is uncertain that McCain would be interested, in his own words, ‘checking the health of the President’, while Giuliani puts forward many policies that McCain disagrees with.

It is not even like McCain hasn’t got any other options. As I have said before, McCain could (and maybe should) leave the Republican party and run with Joe Lieberman as an independant. Although such a strategy would only have a 25% of winning the White House, a good case could be made for the argument that a three way race would substantially reduce the chances of the Democratic nominee emerging triumphant (and would perform the public service of putting the final nail in a putative Bloomberg candidacy). Indeed, the prevention of a third party candidacy is Giuliani’s real agenda. If Giuliani maintain’s his lead in the polls and performs well in the primaries expect more overture to Giuliani, Lieberman and Bloomberg (and more speculation about a place on ticket) only for him to nominate someone like Sarah Palin, Frank Thomspon or Mike Huckabee. This is a trap that both John McCain and Joe Liberman must avoid. Even if McCain still remains in the race for the Republican nomination, loose talk about accepting the second spot (or implying that Giuliani would be an acceptable alternative) would scupper his campaign.

An update about the Republican Nomination

The race is still dominated by Rudolph Giuliani, Fred Thompson and John McCain. However, the McCain campaign is now in dire trouble while Huckabee and Romney are becoming more credible.

Fred Thompson – After the hype, there seems to be something of a backlash. Much of this is down to his decision to delay his entry into the race and rather silly stories about his wife. However, his underwelming fundraising figures and his record as a lobbyist hint that he might not be the ‘next Regan’ while the fact he has not entered into the race, while sensible, does hint at something more fundamental. After all, American political history is littered with frontrunners, such as Hubert Humphrey (in 1976), Edward Kennedy (in 1972, 76 and 84), Mario Cumo (in 1992) and Dick Gephadt (also in 1992) leaving their parties ‘waiting at the church’. Estimated chance of winning the nomination are around 30%. Price on Intrade.com 26.0-26.5. SLIGHTLY UNDERPRICED

Rudy Giuliani – Giuliani is doing relatively well in the polls, with a confortable lead in the national polls and a lead in South Carolina followed by solid second place finishes in Iowa and New Hampshire (according to the average of the last 3 polls). He has also been clever enough to avoid the worst of the pandering on tax and immigration by standing on the sidelines while candidates such as McCain electrocute themselves on the third rail of Republican politics. However, a good prediction should always be about the future rather than the past and in that respect there are several storm clouds on the horizon. Firstly, the fact that his daughter now appears to support Barack Obama indicates the potential for an embarassing appearance by one of his disgrunteled progency. More importantly, the recent revelations about his handling of 9/11 and terrorism (essentially that he used the WTC command centre as a lovenest and that he blew the only terrorism case he prosecuted as a District Attorney) could be the fuse that destroys his campaign. Estimated chances of winning the nomination are around 25%.Giuliani Price on Intrade.com 37.3-37.9. OVERPRICED

John McCain – As previously noted, if electabillity were the sole criterion McCain would be miles ahead. However, if electability (or merit) were that important McCain would be either be annointing his sucessor as President or would probably be presiding over the Senate as part of a Lieberman administration. Indeed, the last fortnight has been especially disastrous with his U-Turn on immigration destroying one of key planks of his programme. Despite the fact an average of the last three polls puts him third (or second if you exclude Fred Thompson) nationally McCain is fourth in Iowa and New Hampshire and third in South Carolina. Ultimately, McCain can still pull this back by keeping the faith on Iraq and moving to the centre on economic issues but the window of opportunity is closing with every pander. We saw flashes of the old McCain at the last debate where he refused to pander to the realists and approving used JFKs ‘bear any burden’ quote – we need to see a lot more of this. Indeed, McCain might be best advised to drop out of the Republican party altogether and run as an independant so he can go back to the positions he has been defending for the last seven years. Estimated chances of winning the nomination are around 15%. Price on Intrade.com 6.0-6.1 UNDERPRICED

Mitt Romney – Although Romney is ahead in both New Hampshire and Iowa he is still in single figures nationally. At the same time his ‘victory’ in the Ames straw poll with less than a third of the vote was underwelming given than no other ‘first tier’ candidate took part. At the same time he is still a single term governor who has pandered to social conservatives in a way that has made him a laughingstock. Although the bigotry of many of his critics regarding his religion might backfire (and has no place in politics) I refuse to believe that someone who reads (and enjoys) L Ron Hubbard can be the Republican candidate. Estimated chances of winning the nomination are around 10%.Price on Intrade.com 21.2-22.7. OVERPRICED

5. Mike Huckabee – As a social conservative who is giving off economically centrist signals he could be a formidable candidate provided he distances himself from his idea of a national sales tax. His performances at Ames moves him to the top of the second tier. Estimated chances of winning the nomination are around 5%.Price on Intrade.com 1.8 2.6. UNDERPRICED

6. Chuck Hagel, John Warner and Haley Barbour – The race is now wide open enough to tempt another candidate to enter. These three are the most likely but others may enter. I could even imagine Colin Powell having a go. Estimated chance of any of them winning the nomination is about 15%.

7. Brownback Tancredo, Paul et al – After Ames we should expect to see Duncan Hunter and Tommy Thompson bow out in the next few days while Brownback and Huner are falling away from Hukabee. Ron Paul will stay in the race but the only thing he will achieve is the loss of his congressional seat next November. Estimated chance of any of them winning the nomination is next to nothing.

Why McCain’s new strategy may be even worse that his old one

One of the reasons why this web-log has disproportionately focused on Senator McCain’s campaign is that he is the one candidate who could dramatically alter the dynamics of the race. It makes little difference whether the Republicans choose Romney, Giuliani or Thompson because the result will probably be a narrow Democrat victory (a result that looks far more likely with each passing poll). In contrast, McCain is the only candidate who could not only beat Hillary but defeat her convincingly, restoring some unity to the country. Indeed, Bloomberg’s pretensions of running for President aside, McCain is the only candidate who would have a chance at succeeding as an independent. However, his recent decision to retool his campaign by flip-flopping on immigration and moving even more to the right on economic issues seems to be the political equivalent of a neutron bomb – destroying the things which made him great while leaving the pandering that got him in these straits intact.

Indeed, up until now much of this pandering has been cosmetic – after all elections are not won or lost on issues such as abortion or gay marriage (indeed polls show that a majority of Americans want more restrictions on abortion). However, McCain’s move from opposing Bush’s tax cuts to promising sign a bill replacing income tax with a national sales tax if such as bill was passed by congress (though it should be noted that he only promised to sign it – not that he would initiate any legislation) is far more serious. Simillarly, his recent decision to introduce an enforcement-only immigration bill directly undermines one of his previous legislative initiatives and along with his courting of the ‘base’ on other issues, has signalled a move to the right. So where does this leave McCain? Indeed, it seems that his decision to replace John Weaver, Mark Salter and Terry Nelson was a victory for those who wanted him to move to the right, rather than a move away from Bush.

A sense of perspective is needed. In the three latest national opinion polls McCain scores an average of 15% which puts him solidly in third, five points ahead of Mitt Romney. For all the media hysteria he is competitive in New Hampshire and actually leads in South Carolina. On the question of dealing with Iraq he is the most highly rated candidate of both the major parties. He still has his exceptional military record and a solid record (in the past eight years) as ‘the conscience of the Senate’. His strategy of focusing on town hall meetings is extremely sensible, and it seems to be generating some crowds. At the same time his new immigration bill, although enforcement only, is actually quite mild. However, I believe that this new strategy will hurt him, not least because he will alienate even more moderates without winning him any friends among the far right. Indeed, even if he manages to win the nomination with this strategy he will be so compromised that he will become as unelectable as any other Republican.

The ironic thing is that he doesn’t need to pander. The conventional wisdom is that the independents who gave him a crushing victory in eight years ago will turn out in the Democrat primary instead and vote for Obama. However, as Hillary Clinton extends her lead over the rest of the field, independents will start to turn their attention to the Republican field. Let’s remember that in 2000 everyone expected large numbers of independents to vote for Bill Bradley. At the same time McCain needs to realise that the anti-immigration and anti-everything wing of the Republican Party will never feel anything but hatred for him. McCain should also realise that, even with the movement of moderates away from the GOP, the extreme right might be much small than many believe. After all, Republicans are pragmatic enough to make Rudolph Giuliani their current frontrunner (although he is a lot less delectable than many of them believe) and 59% of them were pragmatic enough to vote for a left-of-centre former Democrat in Connecticut (according to the CNN exit poll).

So what should McCain do? Having made his point he should withdraw his bill before anyone notices his change of opinion (or at least include some nominal legalization element). Alternatively, he could introduce it but oppose the inevitable deluge of amendments designed to strengthen it (while supporting those which grant a path to legalization). Then, if enough amendments are added to it he could withdraw the bill, having proved that Republicans are only interested in immigrant bashing, as opposed to border security. He should then start taking on Michelle Malkin, Ann Coulter, Lou Dobbs and the other figureheads of the Republican right. Indeed, now may be a time to dust off his ‘agents of intolerance’ speech again – though this time he needs to demonstrate that he will stick to his guns. In effect, rather than heeding the calls to ‘nail three conservative issues and attack Hillary Clinton’ he should concentrate on keeping the faith on Iraq and returning to his original positions on tax, corruption and immigration. This strategy may seem unrealistic, as it is probably more likely that he’ll only realise his error when he falls to single figures in the polls, but it is the only one which will make him a frontrunner again. The coming debate with Ron Paul, if it ever happens, may provide him with an anti-tax, anti-war and pro-drugs straw man to fight against.

To surmise, McCain is a person who has stuck with positions that have been unpopular with both the right and the left. Instead of backing down, his best strategy would be to stick with his guns on immigration and Iraq and return to the centre on economic issues.

Disclaimer: Due to the ridiculous prices available on McCain in the betting markets, I have staked money on him becoming the GOP nominee and the next President. I also have positions on other candidates.

Some preliminary predictions about likely Presidential match-ups.

Given the fact that the Democratic race is, unless Gore or Warner enters the race, essentially divided between Hillary Clinton and Barack Obama and the Republican contest is a three way Thompson/Giuliani/McCain affair, it is possible to start handicapping potential head to heads. Of course, this must still be done at a relatively simple level, without consideration of vice-presidential picks or a Bloomberg (or even McCain) third party candidacy. However, it is still possible to make some useful predictions about the following line-ups (in order of likelihood).

Clinton/Thompson – A evenly balanced race. Clinton has a formidable machine while the general unpopularity of the Republican party will be a tremendous asset. At the same time Thompson is extremely charismatic and will have unquestioned support of the Republican base. However, the decisive factor will be that although Thompson, with the exception of Florida, will be able to easily hold the South, he will find the Midwest and the West a different story while it is difficult to see him carrying anywhere in the North. Yet another ‘fourth and inches’ contest can be expected, only with the Democrats holding the advantage. Prediction: Hillary Clinton has a 55% probability of winning.

Clinton/Giuliani – The conventional wisdom is that Giuliani is the most electable of the Republicans, which is presumably the reason why he is currently ahead in the opinion polls. Although he does enjoy stronger support in the North than a generic Republican and stronger support in New York than McCain, he is weak in the Midwest and the West and is still far behind in his home state. My guess is that he might (just) win New Hampshire but he will struggle to retain states like Ohio, Florida, Colorado, New Mexico, Missouri and even Virginia. Let’s also remember that he had to withdraw from his Senate race in 2000 after consistently trailing in Hillary in the polls. Prediction: Hillary Clinton has a 60% probability of winning.

Clinton/McCain – This is the most interesting of the six contests. As stated before, Hillary will have the advantages of a large political machine, an initial lead in the opinion polls and a full campaign war-chest. Clinton will also have enough command of her base to ensure that she gets at least 45% of the vote whatever happens. However, the fact there is no more polarising figure in contemporary politics and her limited appeal in the South and the West will matter much more against the one Republican who appeals the most to the centre appeal. Indeed, provided McCain keeps the faith on Iraq and Immigration and Bush hasn’t started to withdraw troops by the start of the election, he should win comfortably. Indeed, McCain should pick up New Hampshire and Pennsylvania while only Hillary’s strong support among Latino voters makes California in any way marginal. Prediction: McCain has a 65% probability of winning.

Obama/Thompson – If the Democrats choose Barack Obama as their nominee the contest will dramatically different than if Hillary heads the ticket. More specifically, the contest will be more wide-ranging with a greater number of states in play. However, Thompson will neutralise any strength Obama has in the south so the fact that Obama has a (slightly) greater appeal to that region than Clinton will be irrelevant. At the same time Obama’s inexperience and the tendency for candidates in Democrat primaries to pull their punches in the name of ‘unity’ (a practice that makes it harder for dark horse candidates to score an upset) will mean that he will be unprepared for the onslaught that Thompson will unleash against him. My gut feeling is that it will still be close but the advantage will now reside with the GOP. Prediction: Thompson has a 55% probability of winning.

Obama/Giuliani – A contest between the two weakest candidates will be the most interesting and the hardest to predict. Obama’s lack of experience and solidly left wing record will counteract Giuliani’s lack of a base and his mediocre record (9/11 excepted) as mayor of New York. At the same time Obama’s charisma and youth will be matched by Giuliani’s actions during 9//11. This is probably the only match-up which is completely balanced. Prediction: Both candidates have a 50% probability of winning.

Obama/McCain – The easiest of all the match-ups to predict. Although the 49 state landslide that a Survey USA poll predicted in 2006 is unlikely to happen (indeed Obama is currently ahead of McCain in the last published poll) it is still difficult to see how Obama could win, or even come close. McCain should be looking to win New Hampshire, Pennsylvania, Michigan, California, Delaware, Wisconsin and New Jersey. Provided McCain doesn’t get complacent or make the mistake of pandering to the base his experience, courage and centrism should be unbeatable. Prediction: McCain has a 80% chance of winning.

Although, as I stated at the start of this article, any predictions will always be extremely premature it seems that John McCain and Hillary Clinton are the strongest candidates while Barack Obama and Rudy Giuliani are the two weakest.

Why you can write off John Edwards but not John McCain

It is impossible for anyone who is interested in politics to miss, on either side of the Atlantic, all the hysteria in the press (and the consequent gloating from both extremes of the blogosphere) about the recent blip in the fortunes of the McCain camp. Despite the fact that this ‘blip’ might be already helping McCain to clear the deadwood and glory hunters from his campaign staff, pundits are already making jokes such as ‘John Edwards’ poverty tour visits the McCain campaign’. Ironically, as few observers have already pointed out, McCain and Edwards are in similar positions in terms of amounts of money raised and positions in their respective contest (though Edwards is tied with an undeclared Gore in some polls). Given that Edwards’ place on the 2004 ticket would have made him the Democratic frontrunner in previous years the lack of media comment about Edwards’ implosion is rather perplexing.

Another irony is that Edwards and McCain used to hold similar positions. At the time of the 2004 primaries they both supported war in Iraq and were known for being concerned about the level of inequality in American society. However, while McCain’s move to the right on economic issues has been mainly rhetorical (indeed McCain voted for the minimum wage this year for the first time in his life) Edwards’ decision to become an extremely vocal anti-war candidate has demonstrate that his original decision to support the war was purely opportunistic (as Shrum’s memoirs confirm). At the same time Edwards’ message on inequality has been undermined by the revelations of his expensive (and rather effeminate) taste in hair care. Finally, although Elizabeth’s Edwards’ decision to stand up to Ann Coulter may have taught Coulter a long overdue lesson in civility, the fact is that people expect the candidate to stand up for his/her spouse, rather than the other way round.

However, the most decisive factor that will ensure that Edwards is unable to escape from his single digit ghetto in the polls is the fact that there is plenty of competition for the anti-war vote in the Democrat primaries. Instead of gaining by his reversal it seems that Edwards (like Richardson) has turned himself from a centrist alternative to Clinton and Obama to just another candidate. Indeed, given how vociferously Edwards now opposes the war and demands an immediate withdrawal from Iraq, he has generated amazingly little traction in either the more left leaning of the print media or even in with the (self-styled) ‘activist base’, who have both been seduced by Barack Obama or made their peace with Hillary Clinton. Indeed, if you type ‘John Edwards’ into the search function of Daily Kos (a very good source for gauging the mood of what antiwar Democrats are thinking) you get 23 stories in the last four weeks compared with 33 stories for Obama and 54 stories about Clinton. Ironically, McCain merits the most posts out of the field of Republican candidates (closely followed by Romney and Giuliani) suggesting that the left wing of the Democratic party still implicitly views him as the biggest threat in 2008.

Who will be the pick of the Democrat nominee?

Having handicapped the Republican vice-presidential nomination it is only logical to do the same for the Democrats. This is a relatively straightforward task possibilities for the vice-presidential nomination. This is of course extremely speculative at this stage. If it wasn’t for the fact that the contest seems to be essentially a race between Hillary and Obama, with Hillary the overwhelming favourite, it would be pointless. However, given that the contest for the top spot is not completely unpredictable a few basic predictions can be made about the candidate most likely to feature on the bottom half of the ticket.

1. Barack Obama – Usually people who come second in a presidential primary don’t get the nod as vice-president, not least because the campaign has either exposed their weaknesses or they have irreparably damaged their relations with the winner. However, people have extremely short memories and Kerry’s decision to choose Edwards as his running mate in 2004 has planted in many people’s minds the belief that Obama, if he puts in a good showing, will be entitled to the vice presidential spot. A more convincing argument would be that his youth and charisma would contrast well with Lieberman, or any other possible Republican nominee (excluding Palin). However, Obama adds little in electoral terms to the ticket and his youth is as likely to be a weakness as it is to be an asset. Essentially, his chances depend on Hillary (or Gore) being pressured into choosing him.

2. Mark Warner – If appealing to the political centre and moderate voters, rather than pacifying the base, were the sole criteria Warner would be the obvious choice. He’s moderate, experienced and his home state of Virginia is marginal enough to make putting him on the ticket good from an Electoral College point of view. However, some negatives from the perspectives of getting onto the ticket are his centrist economic and foreign policy views, his decision to withdraw from the presidential primary when he was seen as a serious contender and the fact that he was unable to unseat his namesake John Warner from the Senate in 1998.

3. Jim Webb – Jim Webb is similar to Mark Warner in that he is from Virginia and as a former Regan Republican) has some potential cross party appeal. He also has the requisite views on foreign policy that the left require and has a pugnacious populist streak. However, he only beat George Allen by a tiny margin and he could very well be attacked for abandoning the people of Virginia only two years after he was elected. Despite the fact that Virginia’s was the eighth weakest ‘red’ state in 2004 there are severe doubts, as there are with Warner, about whether Hillary Clinton should even be trying to win any southern states, especially if the Republican nominee is Frank Thompson.

4. Bill Richardson – If targeting southern states is out of the question for Hillary Clinton then moving westwards might be a logical response. Putting the current governor of New Mexico on the ticket would swing three western states (New Mexico, Colorado and Nevada) into the Democrat column and ensure that a McCain candidacy could not threaten California. Indeed, one of the decisive factors in Bush’s 2004 victory was the fact that he reduced the Democrat lead among Latinos to 10%. If putting Richardson on the ticket in 2008 meant that Obama or Clinton got 60% of Latino votes this could well swing a few other states, such as Florida. In fact, since Latinos turn out in lesser numbers than other ethnic groups (with the exception of Asian-Americans) the Democrats could get a double boost from having Richardson on the ticket. The only negative is that there are various rumours swirling around Richardson, rumours which made him withdraw his name from consideration in 2004, which are the last thing that Hillary Clinton needs.

5. Ken Salazar – He has all the electoral positives that Richardson brings to a ticket without the potential for sexual scandal and an appeal to moderate. However, it is his moderate views might bring the ire of Democrat activists while he has lesser name recognition than Bill Richardson. There is also the question of his relative inexperience.

6. Al Gore – Barack Obama might choose him for his experience and his appeal to the South. However, we are unlikely to see another Clinton/Gore ticket while he could fade from view if he enters the race and does badly.

7. Sherrod Brown – Brown would be a strong contender if the eventual nominee wants to win by energising the base and focusing all his/her efforts on Ohio. However, this is a very risky strategy and could backfire if McCain or Giuliani wins the nomination and decides to target a ‘blue’ state in the North-Eas as Brown is too liberal to appeal outside his home state.

8. Blanche Lincoln – If either Obama or Gore win the nomination they will face pressure to put a woman on the ticket. As a centrist and co-founder of the Blue Dogs she would be the logical choice. However, Arkansas is even more of a long-shot than Virginia and she would only be a reasonable choice if Hillary wasn’t the nominee.

9. Claire McCaskill – The Senator from Missouri might be useful in swinging a key Midwestern state into the Democrat column. However, she was only elected two years ago.

10. Bill Nelson – Nelson might be useful in helping the nominee win Florida but he has little national name recognition

Who will get a shot at ‘the bucket of warm spit’?

Having handicapped the contest for the Republican nomination it is only logical to investigate potential possibilities for the vice-presidential nomination. This is of course extremely speculative at this stage. If it wasn’t for the fact that the contest seems to be essentially a race between Fred Thompson, Rudy Giuliani and John McCain, with all other candidates trailing by a large margin, the exercise would be pointless. However, given that the contest for the top spot is not completely unpredictable a few basic predictions can be made about the candidate most likely to feature on the bottom half of the ticket.

1. Sen. Joseph Lieberman – The most obvious choice. He has already hinted that he will endorse Giuliani or McCain if either of them wins the nomination, while his decision to keep caucusing with the Democrats means that any change in affiliation will garner maximum publicity. Choosing him means that at one bound the nominee will regain many of the independent voters that Bush has alienated in the past four years. At the same time it would demonstrate a commitment to an interventionist foreign policy and a more centrist stance on economic issues. Unfortunately, Frank Thompson may want to adopt a more realist foreign policy, Giuliani is pretty much forced to pick a pro-life candidate and McCain may pick either Tim Pawlentry or someone else from the right. The eventual winner of the nomination may also feel uneasy with putting a former Democrat within a heartbeat of the Presidency.

2. Gov. Sarah Palin - If Hillary Clinton or Barack Obama get on the Democrat ticket there will be a large amount of pressure to put a female candidate in the vice-presidential spot. Governor Palin is (for the moment) popular, pro-life and appeals to rural voters and ‘hockey mums’. However, she has only been governor for two years and her popularity could evaporate between now and the convention. It is unlikely that she could hurt the ticket but the Republicans really need someone who could radically shift public opinion and she might be too lightweight to do so.

3. Colin Powell – Like Palin, Colin Powell would be a visible symbol of Republican diversity. He also has extensive foreign policy and national security experience while his presence on the ticket would signal a move back to a more ‘realist’ foreign policy (important if the nominee wants to distance himself from Bush). The fact that he was the original choice of Bill Clinton in 1992 shows that he appeals to the centre while the success of Barack Obama means that the fear of racism, which stopped him running in 1996, is no longer an issue. However, his dovish views on both Iraq wars may make him unsuitable if the nominee wants to take a hawkish stance. There is also the question on whether his pro-choice views make him a suitable candidate for someone like Giuliani.

4. Tom Ridge – One of Bush’s potential choices in 2000 and a popular former governor of Philadelphia with plenty of ‘Blue-Collar’ appeal. A decision to pick him would be seen by many as a solid but timid choice

5. Sen. Susan Collins – As an experienced moderate Senator from a Northern state she would appeal to centrists. However, the only realistic hope of her getting the nomination is if Thompson wins the nomination and decides to balance the ticket by emphasising diversity, or if McCain is pressured into picking a female running mate.

6. Gov. Tim Pawlentry – Only on the list of potential nominees because of his friendship with McCain. His anti-immigration stance may play well with the Republican base but McCain would have to write off California. He might even throw Colorado and New Mexico into the Democratic column.

7. Fred Thompson – Charismatic and has a strong appeal to the Republican right. However, with the exception of Jack Kemp in 1996 and George Bush in 1980, you would have to go back to John Bricker in 1944 to find a defeated primary candidate who got the second spot on the ticket. Thompson might be seen as too old and too politically damaged by the time of the convention.

8. Elizabeth Dole – Although pro-life and female she’s really too old and too associated with her husband’s failed campaign of 1996 and her withdrawal from the Republican contest in 2000. Only the fact that she was seriously considered as Bush’s running mate in 2000 and her husband’s friendship with McCain keeps her in the top 10.

9. Mario Rafael Diaz-Balart - As a youthful Latino Congressman from a swing state Diaz-Balart must be considered a potential nominee, but only just. He hasn’t made much of an impact and the Cuban-American vote is overwhelmingly Republican anyway. Also, memories of Dan Quayle in 1988 demonstrate the danger of choosing a running mate solely on youth alone.

10. Rudy Giuliani - If he does well in the primaries he could be an asset in winning votes in the Northeast. However, the same qualifications about defeated primary candidates apply to him as they apply to Thompson. He is unlikely to increase in popularity and polls suggest that would have trouble in making any inroads in the Northeast even if he was on the top of the ticket.

So the frontrunner for the second spot seem to be Joseph Lieberman and Sarah Palin (with the latter being a possible future Presidential candidate). In terms of what he brings to the ticket, the message that he sends to the voters and the role in which he would play in keeping the nominee to a centrist economic message and a strong foreign policy Lieberman would be a no-brainer. Unfortunately a McCain-Lieberman or Thompson-Lieberman ticket makes so much sense that it seems destined to never happen.

Will the unpopularity of Bush or that of Congress be a bigger hindrance to their respective parties?

In additional to the polarisation of American politics, another puzzle is the extreme unpopularity of both the Democratic controlled Congress and President Bush with approval ratings of 24 and 32 percent approval respectively. This unpopularity is notable given their complete disagreement over nearly every issue, especially foreign policy. The fact that Congress as well as Bush is deeply unpopular also upsets some the assumption that the administration’s foreign policy, as opposed to the way it has been communicated, is inherently unpopular. Similarly, my gut feeling is that the failure of the immigration bill was due to the fact that neither President Bush nor Harry Reid were prepared to make the case for the bill (or even speak about it at all), forcing John McCain to shoulder the task of winning support for it alone. However, the most important question for 2008 is whether the unpopularity of Bush will hurt Republicans more than the unpopularity of Congress will hurt Democrats.

Ultimately, there is little doubt that Bush’s unpopularity will matter more since it is the responsibility of the occupant of the White House to use the ‘bully pulpit’ which of Presidency to seize the agenda, even if the other side controls the legislative branch of government. After all, Regan, Truman and Johnson were able to force through their agenda through an otherwise hostile Congress, while Clinton was able to effectively compromise in the wake of the 1994 Congressional elections. However, by deciding to spend their time in a futile attempt to force a withdrawal from Iraq, at the expense of the economic agenda which they made their centrepiece of the 2006 campaign, the Democrats have revealed the direction a Clinton or Obama presidency will take. They have also left the door open for a Republican who is able to both address the moderate parts of the domestic agenda that Congress promised and also effectively make the case for an interventionist foreign policy.

How the senator from Arizona can pull his campaign back from the brink

As I have said in a previous article, John McCain is the strongest candidate out of all those who have declared or are likely to declare. His campaign is also in serious trouble with fundraising figures that are likely to be extremely disappointing and Giuliani, and now Fred Thompson, ahead of him the polls. The defeat of the immigration reform bill that McCain helped to construct, mainly due to pressure from the Republican grassroots, also appears to be a blow for his campaign.

Be less defensive – This may seem a strange piece of advice given that many commentators believe that his candour on Iraq and Immigration has cost him his frontrunner status. However, McCain’s problem is that he seems to fail to produce appropriate rhetoric to match the substance of his message. For instance, his attempts to argue the case for a much needed immigration amnesty were hampered by his attempts to emphasise the enforcement elements of his bill. Similarly, his talk about a ‘humble’ foreign policy undermines his message about a need to defeat Islamist terror abroad. This doesn’t mean that McCain has a secret Isolationist agenda but it does mean that his preference for couching radical policies in defensive language is handicapping his ability to promote his agenda. The most memorable moments of his campaign, and those which have highlighted his ‘straight-talking’ image, were his comments about possible military action against Iran (his “Barbara Ann” joke) and his comments during the recent Republican debate about the number of Mexican-American’s killed in Vietnam. Whatever the commentators say, McCain needs a lot more of those moments.

Aim for the centre – After eight years of George Bush America has moved noticeably to the left on issues such as poverty, corruption and healthcare. Ironically, McCain seems to have moved in the opposite direction on both social and economic issues. While this is more perception that reality, McCain has both a strong legislative record on healthcare and his opposition to Bush’s tax cuts and an advanced recognition of the social consequences of failing to grant legal status to immigrants, he has co-opted much of the rhetoric of the right. It is difficult to reconcile a call for fiscal responsibility and a belief that, ‘one of the great challenges we may face in the 21st century is this failure to close the gap between the richest and the poorest … particularly at a time when we’ve had a very healthy economy and low employment’, with the rhetoric of Arthur Laffer. This is not a suggestion that McCain should go to the extremes of John Edwards but rather that he needs to outline sensible centrist solutions, such as a rebalancing of the tax code away from hardworking families (i.e raising the top rate of tax but cutting the bottom rates) and a balanced expansion of healthcare coverage. He also needs to broaden his critique of corruption and pork-barrel spending to encompass tax evasion and a reinvigoration of the antitrust laws.

Fire the staff and consultants from Bush’s campaign – If there is one issue that has prompted cynicism from his supporters is his decision to employ many of the consultants from the Republican establishment, including those who ran a vicious smear campaign against him. Indeed, his willingness to overlook the personal nature of the attacks that many of those now working for him employed against him, while highlighting that he is strong enough to put aside grudges, opens McCain up to charges of Dukakis style weakness. In any case, while keeping them on his payroll may have made strategic sense when he was the undisputed frontrunner for the nomination and the only alternative to Giuliani, the same logic no longer applies now that Fred Thompson has emerged as an elect able and conservative alternative. You even have to wonder, given the level to which they descended in 2000 and their previous affiliation with Bush, whether they even have any interest in a McCain victory, something no candidate should have to ask about his staff. In any case they are patently unable to take part in the style of campaign that McCain now needs to wage and should be fired for that reason alone.

Contemplate an independent run – Although Bloomberg’s ego trip might have seemingly reduced the viability of this option I believe that either media interest will have dwindled by around October or Bloomberg himself will have pulled out. In any case a McCain independent candidacy, unlike that of Bloomberg, would have had a basic level of support of around 20-25% and if he was able to push the Republican nominee into third place early on (not an impossible task) he could force Republicans to tactically rally around him (as they did with Lieberman in 2006). The upside of contemplating an independent run would be that it would force him to appeal the centre rather than trying to aim his message at all parts of the Republican Party.

My guess is that McCain is about 60% likely to realise that he needs to change course before it is too late and if he does there is a 40% likelihood that he will win the Republican nomination. If he doesn’t then his chances are about 5%. If he does change his campaign and doesn’t win I would say he has a 50% likelihood of running as an independent. Assuming that he has about a 25% likelihood of winning the White House as an independent and 60% of the Republican nominee produces a likelihood of winning the nomination and a 22.5% chance of becoming President.

Could a McCain-Lieberman ticket recapture the American political centre?

One of the paradoxes of modern American politics is while the political discourse has become ever more polarised and both the major parties have drifted ever further from the centre, the one foreign political figure universally respected in the United States is Tony Blair. Indeed, the last time his popularity among the American public was polled by Gallup, at the start of March, nearly two thirds had a favourable impression of him while only one in five Americans had an unfavourable opinion of him. This contrasts with the abysmal popularity of Bush (favourable rating 33; unfavourable 62) and even the ratings of the major candidates for 2008 such as Rudolph Giuliani (61/24), John McCain (50/30) and Hillary Clinton (50/47). Indeed, it has become almost a cliché that if Blair was not constitutionally barred from running there would be a clamour to draft him for the White House. Therefore, it seems logical to ask which candidate on the American political scene can best attempt to follow in his footsteps, or at least which politician can catch the political centre.

The most obvious place to begin such a search would be with the candidates for the Democratic nomination. However, there is no American equivalent of the government’s respect agenda, a general hostility among the Democrat candidates to free trade and surprisingly little talk about social exclusion and even less about the future of public services or pension reform. It also goes without saying that on the one issue that has defined political debate on both sides of the Atlantic, namely Iraq and the struggle against Islamist terror, there seems to be no support for standing up for democracy. The only areas of agreement with their counterparts across the Atlantic are minor issues such as civil partnerships, hardly the fundamental issues facing America. Similarly, the Republicans have moved even further out into right field than usual, with no ideas (or even awareness) for solving either the social problems gripping America or the budgetary consequences of Bush’s fiscal recklessness. Even on the issue of there are signs that they may be reverting to their isolationist roots with Sam Brownback, and now Mitt Romney, qualifying their support for a continued presence in

However, there is one serious candidate who breaks away from this mould, the maverick senator John McCain. His support for action on global warming, pension reform and an interventionist foreign policy overlaps with that of Tony Blair. In addition, his attempts to work with Democrat Senators on attempts to reform immigration, healthcare and campaign finance show his dedication to the important issues that affect everyday Americans. Indeed, the respected magazine National Journal puts him smack the centre of the Senate based on last year’s voting record. However, McCain is still no Tony Blair. After all, he may have opposed Bush’s tax cuts and proposed a commission on healthcare, but he doesn’t intend to reverse them and he hasn’t put forward specific proposals of his own (though he hinted at support for universal healthcare in his 2000 campaign). However close McCain came to leaving the Republicans in 2001 or joining Kerry’s ticket in 2004, he has remained a Republican. Despite the fact that he has been a senator since 1984, McCain began his bipartisan cooperation only in the mid nineties. At the same time a lacklustre and confused campaign means that he has both lost his frontrunner status and much of his previous support.

However, despite his shortcomings he still remains the candidate closest to the political centre (barring a re-entry by Mark Warner) and by far the candidate with the strongest character and integrity. McCain first needs to accept that he is never going to capture a large proportion of the most ideologically driven Republican primary voters and that trying to appeal to them will be counterproductive. If he wins the nomination selecting Joe Lieberman as his running mate (the American politician whose views coincide most closely with Tony Blair) would also demonstrate his centrist credentials. Although they disagree on as many small issues, as one would expect of a moderate Republican and a moderate (Independent) Democrat, they have a remarkable record on the big issues. They have sponsored legislation together on the environment, gun control and Iraq while Lieberman has worked with other Republicans to increase immigration of skilled workers. If they stick to foreign policy and the domestic problems, which both President Bush and Nancy Pelosi have left unaddressed, such a ticket could be unbeatable. In any case the evident respect that the American public have for international political figures like Tony Blair should demonstrate to both sides the importance of confronting pressing concerns while speaking to the centre and adopting a foreign policy which is not afraid to stand up for freedom.

Should we treat Hillary Clinton’s lead in the opinion polls with a pinch of salt?

As yesterday’s article about the Democratic nomination makes clear that I believe that Hillary Clinton is, and should be, regarded as the favourite for the Democratic nomination. However, the Democrat field is notorious for being one with a track record of frontrunner failure. Looking at the Gallup archive for opinion polls in the summer before the primaries I found the following:

1951 – A poll on May 24th had Dwight Eisenhower leading Truman. Adlai Stevenson was not among the ten possible candidates listed in the poll.

1967 – By July 18th Lyndon Johnson was leading Robert Kennedy by over 6% with no other candidate having declared.

1971 –Polls in April and June had Hubert Humphrey and Ted Kennedy leading the field with George McGovern in single digits.

1975 – A poll on May 5th had Hubert Humphrey as the frontrunner with Jimmy Carter on 1.25%, behind over twenty other possible candidates.

1979 – A poll on August 10th had Ted Kennedy ahead of President Carter by over 25%.

1987 – A poll on July 13th had Jesse Jackson in the lead, slightly ahead of Michael Dukakis.

1991 – As late as June 29th Paul Tsongas was the only declared candidate. In a list of candidates people would like to see run, Bill Clinton was sixth with only 1.75% (13 respondants in total) wanting him to enter the race.

2003 – Joe Lieberman was the undoubted frontrunner in the first half of 2003. Even by July 12th he was still in the lead by four points. John Kerry, was in fourth place behind Dick Gephardt and Al Sharpton.

So in eight out of the 12 post-war elections for which we have polls for (there were no polls covering the Democrat nomination in the summers of 1947, 1963 or 1995) the candidate who was leading in the polls during the previous summer or late spring did not win the Democratic nomination. So, what conclusions can we draw from this? The obvious conclusion is that the Democratic primaries are indeed extremely fluid and that trailing candidates can come back (Carter, Dukakis and Kerry are obvious examples) while obscure candidates can rise to the top provided enough ‘big guns’ decide to withdraw (McGovern, Carter in 1976 and Clinton are obvious examples).

However, the temptation to simply use past form should be resisted. Hillary Clinton, barring an unforeseen event, is simply not going to withdraw (as in 1952, 1968, 1972 or 1976). Nor, like Lieberman in 2004 and Jesse Jackson in 1988, her support built upon the fact that she has superior name recognition. In fact the best analogy is with 1984, one of the few cases where the frontrunner managed to win the nomination, where Walter Mondale used his establishment status and better organisation to win beat Gary Hart.

Handicapping the Democratic Nomination at this stage

In contrast to the Republican race, the Democrat contest is between Hillary Clinton and the rest of the field. Only the possibility of Al Gore entering the race muddies the water a little bit

Hillary Clinton – Hillary has the name recognition, the money, the support of the Democrat establishment and she leads in the polls. She also has a formidable organisation (including several of the brightest minds in the business). Her response to Obama’s criticism of her position on outsourcing and her call for unity during one of the early debates demonstrates her ability to win the ‘spin wars’. She also has a natural constituency and if she gets the nomination it is to see her getting less than 45% of the vote. However, although her strategy of avoiding the worst of the left wing grandstanding over Iraq is a shrewd electoral strategy it means than many on the left dislike her. At the same time there is a general recognition that she is a divisive character and even if Bush remains unpopular her national support has a natural ceiling of 55%. If she were facing a stronger field her chances would be a lot less but given the field the estimated chance of her winning the nomination is around 60%. Price on Intrade.com 48-50. UNDERPRICED

2. Barack Obama – In many ways Barack Obama is like Gary Hart in 1984 (though obviously without Donna Rice). He is running against an establishment figure with a liberal voting record who doesn’t generate much enthusiasm. Similarly, although he is slightly to the left of Hillary and is light on policy there is the perception that he is ‘a new kind of Democrat’. However, his record makes Hart look experienced and his candidacy seems to be a demonstration of the ‘audacity of hype’. We should also remember than Hart was not able to beat Mondale for the nomination. Expect him to do well enough in the contest to make a convincing case for the vice-presidential spot. Estimated chance of winning is around 20%. Price on Intrade.com 30-31. OVERPRICED

3. Al Gore – If there is one candidate who could upset everything for Hillary it is Gore. Gore has the experience and has the support of the Democrat left for his antiwar and pro-environment stance. He also has a greater appeal to the South than either Obama or Clinton. However, he has stated several times that he doesn’t intend to run (although a late entry would be his best strategy). The only effect that his candidacy might have is on the vice presidential tickets since he would siphon support away from Obama and his presence could deter Joe Lieberman from joining a fusion or ‘national unity’ ticket with the Republican nominee. Estimated chances of winning the nomination is around 10%. Price on Intrade.com 9-10. FAIRLY PRICED

4. John Edwards/Bill Richardson – Although there is certainly place in the Democrat race for a centrist who is willing to address the big issues and stand up for a strong foreign policy both Edwards and Richardson have moved away from the centre. Edwards might have started out addressing the issue of poverty but his decision to use campaigns funds for grooming has undermined his credibility. Richardson might be a savvy choice for the vice presidential spot. Estimated chances of winning the nomination are around 5% each. Price on Intrade.com 5-6 (Edwards) & 2-3 (Richardson) FAIRLY PRICED/UNDERPRICED

5. Biden, Dodd, Kucinich, Gravel et al – The only interesting thing that could change the race is if Mark Warner re-entered the race (which is unfortunately unlikely). Apart from that the fringe candidates can be ignored.