An updated analysis of the Republican contest

October 16, 2007


With the exception of the bottom tier, there is little change

The race is still as murky as ever. Giuliani has a clear lead nationally, but there is considerable value in Fred Thompson and still some value left in John McCain.

Rudy Giuliani – I have to admit that Giuliani has performed extremely well. Few people would have thought that he would still be leading in national polls and polling a strong second in New Hampshire and South Carolina. As I said in August, Giuliani has been clever enough to realise that he merely needs to earn acceptance from the right of the party. His prudence in keeping a low profile on his most controversial positions also means that, unlike McCain, he can still advocate moderate policies on immigration and taxation. Giuliani has also benefited from the fact that enthusiasm for Thompson has been limited and that no other credible right-wing candidate has emerged who can pass all the various litmus tests on abortion, gay marriage and other issues. However, the situation might look radically different if the right coalesce behind a candidate or if someone launches an all-out negative assault on him (which Mitt Romney seems to be starting to do). Estimated chances of winning the nomination are around 40%. Price on Intrade.com 40-40.5. FAIRLY PRICED

Fred Thompson – The irrational exuberance of him being the ‘next Reagan’ have been replaced with irrational pessimism. Thompson may have few compelling policies, he may fail some of the litmus tests of the base and he may be a bit stiff but he still remains the most credible conservative in the contest. It should also be noted that in 1980 people were initially making similar complaints about Ronald Reagan. Thompson has been the clear overall winner in the various straw polls that have been held and he is starting to catch up with Giuliani in the national Rasmussen 3 day tracking poll, after his ratings fell in the wake of the Michigan debate. He needs to get the base onside, even if that means pandering on issues such as gay marriage. Estimated chances of winning the nomination are around 35%. Price on Intrade.com 15.8-16.1 UNDERPRICED

John McCain – If Giuliani has provided a master-class in how to gain acceptance from the Republican base without compromising one’s key beliefs McCain has demonstrated the opposite. Unlike Mitt Romney, most people realise that McCain does have sincere beliefs and they are not as unpopular with the Republican rank and file as most commentators believe. However, by pandering to the right and backing down over immigration he gives the impression that he is unable to stand up for them when it counts. Indeed, his one moment of consistency, namely his decision to stand and fight for a continued US presence in Iraq, is what has kept him in this race. He needs to go back to the themes of his 2000 campaign and start appealing to the centre, although he seems to have gotten himself into a pointless fight with Romney instead. McCain supporters need to pray that Giuliani starts to fall off the radar in the next few weeks so that McCain can have the centre all to himself. Estimated chances of winning the nomination are around 10%. Price on Intrade.com 6.7-6.8 UNDERPRICED

Mitt Romney – Romney may be still ahead in Iowa and New Hampshire and third nationally but I still think he is too toxic for either the average Republican voter or America at large. Despite his endorsement from Ann Coulter his chances of being the right’s standard bearer are marginal at best. His best hope is that Giuliani implodes and that he inherits his centrist mantle. His chances of winning the nomination are about 5%. Price on Intrade.com 25-25.6. OVERPRICED

5. Mike Huckabee – Like Thompson, Huckabee would be the logical standard bearer for the right of the party if he didn’t fail several of the litmus tests of that faction. Unfortunatly, for him being an religious conservative, pro-immigration and the supporter of the most regressive tax plan ever divised just don’t make for a coherent candidacy. His under-the-radar campaign might have got him close to McCain, in terms of Rammussen’s tracking polls but elsewhere he barely breaks into double figures, even in Iowa . His chances of winning the nomination are 5%. Price on Intrade.com 2.9-3.2. UNDERPRICED

6. Anyone else – Evidence from straw polls and opinion polling confirm that Brownback, Hunter and Tancredo might as well give up. Although a credible argument could be made that Ron Paul is the strongest of the third tier candidates (in terms of support) such an argument is like saying the Liberal Democrats are more likely than the Green Party to win the next British election. I still believe that betting against him is free money. Although the entry of a candidate like Collin Powell or Chuck Hagel might have had some impact a month ago it is now too late. JUST AVOID.



  1. Ron Paul is a top-tier candidate. Stay tuned for the press conference tommorrow regarding campaign finances.

  2. Apparently Fred was overpriced at 15 because now he’s down to 12 with bids in the 11 range.

    Giuliani is way overpriced in the 40s. The alleged frontrunner can’t win a single straw poll anywhere in the country?

    Who is winning all those straw polls, then? Oh yeah, it’s Mr. “avoid”:


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