Archive for the ‘US Politics’ Category

h1

Final rant about the bailout

September 22, 2008

My (hopefully) final thoughts about the bailout

What really annoys me about this is the scaremongering from the press and Paulson. The irony is that things are nowhere near a depression. A technical recession maybe, but even at the nadir last week the money markets were merely as bad as they were in the early 1980s and much better than they were in the 70s. The problem is after twenty years of relative stability, at the first sign of a slowdown people assume that it is 1929 again. This is the first time in history that we are going to bail out the banks long before any of them actually go bankrupt. The irony is that the glut of international regulation that is going to follow Paulson’s socialist folly (nationalised ratings agencies, caps on bonuses, IMF involved in global financial regulation) will make thing permanantly worse.

h1

Almost makes Palin sound coherent

September 20, 2008

Look, I’m sure there are some of my friends saying, ‘I thought this guy was a market guy — what happened to him?'” Bush said. “Well, my first instinct wasn’t to, you know, lay out a huge government plan. My first instinct was to let the market work, until I realized, being briefed by the experts of how significant this problem became. And so, I decided to act and act boldly.

“It turns out that there’s a lot of interlinks through the financial system. The system had grown to a point where a lot of people were dependent upon each other and a collapse of one part of the system wouldn’t just affect a part of the financial markets, it would affect … capacity to borrow money. to buy a house or to finance a college loan. It’d affect the ability of a small business to get credit. In other words, the systemic risk was significant and it required a significant response. And Congress understands that and we’ll work to get things done as quickly as possible

– George W Bush

h1

How will the Bush Presidency be viewed in ten years time?

May 11, 2008

TPT evaluates the Bush Presidency

At the moment George W Bush is not viewed very highly by the American public. At the moment the latest estimates are that less than a third approve of the job that he is doing. Indeed, Pollster.com put hiis approval rating at a dismal 28.3%. His immigration proposals went down in the flames last summer and he is assailed by the right as a big spending liberal while two towns in Vermont voted to arrest him and Dick Cheney if they ever dare to enter the city limits. Some people even believe that the damage to his reputation extends beyond Bush himself with the respected commentator Professor Larry Sabato declaring, in an article last summer pondering possible Republican running mates, that ‘(Jeb Bush’s) last name is tarnished for a generation’. Democrats leaning pressure groups are running ads trying to portray John McCain as ‘four more years of Bush’. However, although it is unlikely that Bush’s reputation will have dramatically changed by November, although past President’s tend to a enjoy a small uplift in the last few weeks of their presidency, it is interesting to try to evaluate Bush’s administration over the past eight years.

Indeed, it is difficult to realise from contemporary views that venerated figures John F Kennedy and Ronald Reagan were, at various points in their careers, highly controversial figures who experienced bouts of unpopularity. One way to view the Presidents since 1928, which is popular with historians, is to divide them by tiers. Although it varies from historian to historian I would say that the first tier would includes presidents such as Franklin Roosevelt and Harry Truman who had major achievements in both the domestic and foreign spheres and fundamentally changed the tone on the political culture. The second tier includes those who left their mark but either had enough flaws, such as Lyndon Johnson and Ronald Reagan, to disbar themselves from the first tier or did not spend enough time in office, like JFK, to run up a solid list of achievements. The third tier is for those who were too controversial or bland for the second tier, such as Dwight Eisenhower, while the fourth and fifth tiers are for mediocrities (George HW Bush and Gerald Ford) and disasters (Richard Nixon, Herbert Hoover and Jimmy Carter) respectively.

So which tier does Bush fall into and how does he compare with Clinton? If you look at domestic achievements, then Clinton did have a tendency to focus on ‘small ball’ but he did succeed in chipping away at the more obvious problems, with action to reduce gun crime and expand access to healthcare for children. In contrast Bush managed to turn a large surplus into a deficit with tax cuts that were skewed towards the wealthy and his immigration package, although surprisingly sensible and progressive, folded in the face of Republican opposition. However, Bush did take the first tentative steps to raising educational standards, with the No Child Left Behind Act. In terms of upholding the integrity of the office and changing the tone of American politics, both Clinton and Bush failed. However, Bush’s problem was that he created were a culture where special interests and donors held sway and a slash and burn style of politics that focused on dog-whistles and smears.

However, in foreign policy the positions are reversed. Although the Clinton administration did eventually intervene in Bosnia and again in Kosovo, this was done at the behest of world leaders like Tony Blair and congressional leaders like Bob Dole. Although the Bush administration has been criticised for taking its world view from an episode of 24, most notoriously in terms of military interrogation, the Clinton administration was definitely guilty of buying into the West Wing view that all world problems can be solved with a bit of diplomacy and a few photo opportunities. Bill Clinton would probably have liberated Afghanistan and might even have attacked Saddam, but he would not have been able to face down the United Nations, nor would he have kept troops in Iraq for five years. Clinton also lacked Bush’s philosophy of spreading democracy, instead preferring to take his guidance from whatever book happened to be on his nightstand that evening, or whatever advisor had spoken to him last.

Ironically, it was Bush’’s one shout out to Clintonian policy making that nearly undid all the gains in Iraq, namely the decision to convene the Iraq Study Group. This decision made it appear as though he was not in control of foreign policy, and left many people (including myself) convinced that he was about to announce a withdrawal from Iraq after the mid term elections. Even this mistake, and the failure to send enough troops, was overcome with the surge strategy, which has succeeded beyond everyone’s wildest dreams. Another irony is that, the unilateralist has probably done more to kick-start the process of making the UN a more effective and accountable organisation than Clinton the internationalist, although a lot more work needs to be done. So, to conclude, the Bush administration was definitely a middle tier presidency. In Bush’s case he has been ineffective in the domestic fields and has lowered the tone of politics. The decision decision to make promotion of democracy and human right an integral part of America’s relations with the rest of the world, even if it means unpopularity both domestic and abroad is commendable. So in that sense Bush’s presidency is a presidency redeemed, although hopefully his sucessor can raise the tone of politics.

h1

Obama’s leads falls again to 13.50%

March 31, 2008

Another small fall for Obama, but he still has a solid lead

north-carolina4.jpg

Adding the ARG poll to the collection of North Carolina polls, I’ve come up with the following projections.

Barack Obama 50.96
Hillary Clinton 37.46

Hillary seems to be catching up again. However, even the most hardened supporter will accept that she has a mountain to climb if she wants to reduce Obama’s lead to single digits. However, if she manages to creep up on him percent by percent, without a massive swing in his favour, it is possible.

h1

Is this an opportunity for Rudy or Hillary?

March 11, 2008

Could Giuliani or Clinton run for New York’s Highest Office in 2010?

 spitzer3.jpg

Now that Republicans are threatening impeachment, and there is even talk of Spitzer facing criminal charges, it is almost certain that Elliott Spitzer will be forced to step down as Governor of New York. Although, the Lieutenant Governor David Paterson will step into his place, Paterson allegedly has his own ethics problems. This will mean that to all intents and purposes the governor’s mansion will be an open contest. This leaves the field open for Rudolph Giuliani on the Republican side and Hillary Clinton, if she is unsuccessful this November, on the Democratic side. The governor’s mansion would be an ideal stepping stone for the Presidency, allowing the occupation two years to showcase their executive abilities on a larger scale. Of course Hillary could be criticised for only spending two years before running for the White House again (and so would Giuliani). However, they could sidestep this by selecting a strong running mate, possibly Donald Trump on the Republican side and Andrew Cuomo for the Democrats. Of course Hillary could still win the Democratic nomination and Giuliani could be McCain’s running mate. However, this does reduce the likelihood of Hillary accepting the bottom place on a ticket with Obama, if nothing else.

h1

9 Predictions for 2008

December 31, 2007

10 Predictions for 2008

1. Mitt Romney will win the Iowa caucus…..
2. …but John McCain will win in New Hampshire
3…..and in South Carolina.
4. Different candidates will be declared the winner in the official results and in the ‘Entrance Poll’.
5. Barack Obama will NOT be the Democratic nominee for President.
6. Joe Lieberman will be nominated for the second spot on the Republican ticket.
7. The Democrats will nominate James Webb for Vice President.
8. Either Ron Paul or Michael Bloomberg will run for President.
8. There will be either an internal challenge to Gordon Brown or a surprise election.
9. A EU constitution referendum will be called this year in the UK.

h1

Is there still value in betting against Romney in Iowa?

November 20, 2007

Why you should still short Mitt.

romney2.png

One of the most interesting development in the race has been the extent to which Romney’s supremacy in Iowa has been challenged by Mike Huckabee. Although Huckabee is still, by my estimation, over nine points behind Romney, the fact that the governor of Arkansas has managed to get so close to Romney without spending any money on advertising, indicates that Romney’s support in the Hawkeye state is very thin. This has been reflected in the betting markets with the contract on Romeny winning Iowa falling from a peak of 69.3 in early October to the current level of 55.9. However, I think that the Romney contracts still have a way to fall as the fact that Huckabee is attracting enough money to begin airing some adverts in the Hawkeye state will boost his name recognition and make him seem a more credible candidate. I believe that once Huckabee has been perceived as the more credible candidate, a lot of the Evangelicals who were unsure about Romney and Thompson, or were opposed to Romney but were not decided about who was best able to stop him, will move to Huckabee. I firmly believe that Romney’s contracts are overvalued until they enter the low 40s.

What do you think? Add your thoughts below.

h1

What can we learn from the Weekly Rasmussen Poll?

October 25, 2007

An interesting theory about the Republican contest

Yesterday, I added to my position on John McCain so that I have a relatively large part of my bankroll resting on both John McCain and Fred Thompson. I did this because I think that the true probability of John McCain winning the Republican nomination is about 15%, and is certainly higher than the 7.4 that I was able to buy at. I have to admit that, after studying the polls, my previous estimation that John McCain was only 10% likely to win the nomination was a bit too pessimistic. This is not because of the frequent press speculation that, ‘McCain is back’, the positive words said about him recently in magazines like the American Spectator or because I think that he is the strongest candidate Instead, this comes from a new theory I have about the race.

Earlier this year the political analyst Dick Morris came up with the idea that the early Republican primaries were a semi-final that would narrow the pack, but not decide the race. I have to admit that I was sceptical, until I saw several interesting patterns in the weekly national tracking polls since Mike Huckabee entered the contest. Firstly, if you correlate McCain’s and Giuliani’s votes you get a negative correlation of -0.6, suggesting that they are fishing for the same pool of voters. Similarly, if you add McCain’s and Giuliani’s votes together to get a ‘centrist’ bloc, and do the same for Thompson, Romney and Huckabee to get a ‘conservative’ bloc, you find that the ‘Conservative’ share of the vote since August is around 38-44% and the Centrist bloc is 32-39%. Both blocs seem to be stable, with a low weekly variance of around 2%.

So, what does this mean for the contest? Well, it means that both McCain and Thompson have made a big mistake by letting themselves be outflanked on the left and right respectively. It also means that Giuliani hasn’t become popular per se, it is just that McCain is siphoning less votes from his candidacy than Romney or Huckabee are from Thompson. It also suggests that McCain can knock Giuliani of the contest by beating him in Iowa while can Thompson do the same to Romney and Huckabee. So, one possible scenario is that Thompson wins the Iowa primary with Huckabee second, Romney third, McCain fourth and Giuliani fifth. Giuliani and Romney drop out while Huckabee is mortally wounded (if he can’t win in Iowa where can he win)? The race then becomes a two-way contest between Thompson and McCain with New Hampshire and South Carolina deciding the contest.

However, it is important to retain some perspective. McCain might be the best candidate and it is possible that he will pick up the pieces if Giuliani fails. However, he currently has to run his campaign on funds borrowed against his general election money (some of the money that he raised can only be used in the general election because it was over the donation limit for the primaries. It should also be remembered that if Iowa is two contests, for the centrist and conservative crowns, then it is imperative that McCain make sure that he finishes ahead of Giuliani there, otherwise his candidacy, at least for the Republican nomination, will be effectively over. The burden of expectations is not so high for Thompson because he merely needs to finish ahead of Romney.

McCain also need to demonstrate that he is still a centrist in principle and that he is prepared to reach out to Democrats and Independents, possibly by demonstrating that he willing to roll back some of Bush’s more egregious tax cuts for the wealthy. His campaign is also partially dependant on Romney and Thompson continuing their attack on Giuliani. McCain should also make sure that he keeps on the radar of the media and so doesn’t fall back into single figures. It also goes without saying that McCain needs to keep the faith on Iraq, and avoids the ‘declare victory and get out’ trap that some on the right seem to falling into. Even if the McCain supporter who posted in the comments section of the previous post that, ‘what McCain lacks in money, he makes up for in effort’, is true, the effort still needs to be directed correctly.

Update (28/10) When I posted I typed (for some strange reason) that ‘Thompson wins the Iowa primary with Huckabee second, McCain third and Giuliani fourth and Romney fifth’. As a poster pointed out, this is clearly nonsense, so I’ve amended it to what I wanted to say.

h1

A free lunch courtesy of Dr Paul’s supporters

October 14, 2007

ron-paul.jpg

Is betting against Ron Paul money for nothing?

Fans of the Efficient Market Hypothesis like to say that ‘there’s no such thing as a free lunch’. Of course, I don’t believe this, since if I did I wouldn’t be writing this web-log or betting on Presidential Elections. However, it is always a good idea of be sceptical of bets ‘that cannot lose’ because they have a very nasty habit of biting the wary punter in the behind (although I have to admit that academic studies show the value is generally in shorter odds). The case of Ron Paul is undeniably an exception. Few people anticipated the way in which Rudolph Giuliani has prospered in the battle for the Republican nomination, despite his (relative to the rest of the Republican Party) socially liberal views, flamboyant private life and the fact that he couldn’t beat Hillary Clinton in 2000. However, unless the world really has gone upside down I don’t believe that the Republican Party would ever nominate an antiwar, pro-drug legalisation crackpot who ran as a Libertarian in 1988 and got less than 1% of the vote.

Indeed, I don’t believe that the ‘balance of probabilities’ is against him winning the nomination I just can’t see any scenario whatsoever where he wins the nomination. Of course nothing is an absolute impossibility but I put it up there with the US Government defaulting on its debt, the Liberal Democrats winning the next British election and other such absurdities. However, what I can’t understand is the fact that Paul’s price on Intrade.com is 6.9-7.0. At this price betting against Paul produces a much better interest rate than putting it in a bank account. However, what really intrigues me is the reason for this price, which gives Ron Paul a higher probability of winning the nomination than either John McCain or Mike Hukabee. There have been moments where the betting markets have gone insane, but they tend to be on election nights when punters overestimate the accuracy of opinion polls rather than during the campaign itself. The fact that Ron Paul has a small band of fanatical supporters could be one reason but other fringe candidates aren’t similarly overpriced.

What do you think? If you agree or disagree with this article leave a comment below.

h1

Markets still sceptical about Gore

October 13, 2007

There’s still value in the former Vice President

The reaction to the announcement of Gore’s Nobel victory has prompted the predictable call from the media for him not to enter the race. The logic goes that he can influence the race more by endorsing either Obama or Edwards than by challenging Hillary Clinton. Interestingly, the betting markets seem to have concurred with the price on Gore still only 11.7-12.5 on Intrade.com, compared with highs of 16 yesterday. I have to say that I think that this is a buying opportunity since he realises that an endorsement of either Barak Obama or John Edwards would be wasted and that the only way he can influence the contest is to run himself (although I think that if he really didn’t want to run he would do better to endorse Edwards rather than the Audacity of Hype).

h1

Gore: the evening after

October 12, 2007

How would a Gore candidacy affect the race?

_44173839_gore_getty203.jpg

I believe that Al Gore will run for the Democratic nomination. This is not only because he has the best chance of stopping Hillary Clinton, but because he has left the draft movement go on for too longer. Although I disagree with most things that Gore stands for, and I think that John McCain and Joe Lieberman have done more for the environment, I think Gore would not be so irresponsible that he would let people spend large amounts of money on ads in the New York Times urging him to run if he were not prepared to do so. So how could a Gore entry change things? Firstly, the candidacies of Chris Dodd, Joseph Biden and John Edwards would pretty much be destroyed by Gore’s entry into the race. Their records pale in comparison with Gore’s and they lack the funds to keep running on their own. They are all fishing in the same antiwar pool as Gore, which means that they will lose much of their support overnight. Indeed, I am going to go out on a limb and predict that Biden and Dodd would withdraw within a fortnight and Edwards could bow out within a month of a Gore announcement. Obama will probably stay in the race until the New Year, not least because he raised so much money that he will have to spend it all (probably an extended futile advertising blitz) or face the embarassing prospect of returning it. Richardson will also stay in until Nevada, although he would be better placed to withdraw and concentrate on the New Mexico senate race and the prospect of 2008.

It goes without saying that Hillary will face the fight of her life with an opponent who has experience, support from the ‘nutroots’ that currently dominate the Democrats and the ability to raise large sums from both individuals and corporate donors in the technology sector. Although I think she will triumph, it certainly not the foregone conclusion the contest seems currently. A more interesting question is how will this affect the Republicans. On the one hand they will have some time to regroup, time which candidates like McCain sorely need. However, Gore’s presence could siphon off the independents that McCain, the strongest Republican candidate, will need if he has any chance of gaining the nominaition (or at least doing well enough to make a third party run credible). There is also the possibility that Joe Lieberman, whose prescence on the bottom half of the ticket is vital if the GOP wish to retain the White House, will be unable to run against Gore (though little love has been lost between the two since Gore both failed to endorse him in either 2004 or 2006). In the general election Gore’s prescense slightly move the field back in the GOP direction (although he should still be favourite against any candidate other than McCain) since he is to the left of Hillary and lacks her remorslessness (although the fact he isn’t so polarising increases the possiblity of a Democrat landslide).

h1

Will Gore Run?

October 11, 2007

Will the former vice-president be able to stop Hillary?

  gore_al.jpg

Until recently, I was very sceptical about Gore’s chances of even joining the Democratic contest. After all, in addition to Hillary, Gore would have to contend with Barak Obama, Bill Richardson, John Edwards and a possible Mark Warner re-entry into the race. Also, I was sceptical about the extent to which he would be able to transcend his single-issue focus on the environment and the fact that he had moved considerably to the left on most issues. However, many of these hurdles have simply disappeared, since even Obama’s most prominent supporters seem to have accepted that the Audacity of Hype simply lacks the experience and qualifications to be President. At the same time neither Edwards’s nor Richardson’s campaign is going anywhere soon (and Warner will now be running for the Senate). Finally, Gore is the only one of the serious candidates who has more experience than Hillary, while his disengagement from current politics gives him a blank slate to define himself on.

Ironically, another deciding factor is that Hillary’s main advantage, that she is very likely to deliver a small victory against Giuliani, Thompson or Romney (McCain is just about likely to beat her while Hukabee would be hard pressed to carry more than 100 EVs), is fast becoming superfluous. Indeed, with a clear plurality of people identifying themselves as Democrats, and the possibility that the Democrats might gain a filibuster proof majority, there is a compelling argument for selecting someone who doesn’t guarantee a minimum Republican turnout on Election Day. Of course it is possible to overstate this case since the Al Gore of 2008 is different from that of 1988, or even 2000 and he will face tremendous pressure to go even further leftwards. It also might be embarrassing for him, if he wins the nomination, to have to face the person who he put on his ticket in 2000 at the bottom of the Republican ticket.

So what are his chances and what should he do to maximise his chances of winning? It goes without saying that Gore will have to get into the race as soon as possible, the fact that he’ll know one way or other about the Nobel Prize tomorrow will mean that could enter it by the week-end. Gore should also take care not to drift too far to the left and find another cause, beyond global warming, to take up. He should remind voters of his previous health care plans from 2000 and he should also emphasise political reform, hoping that the remaining memories of the Clinton-era fundraising scandals attaches to Hillary rather than him. He should also emphasise his experience as vice-president at every opportunity, reminding voters that while Hillary may have shared (or not as the case may be) a bed with Bill Clinton he was a successful vice president.

Of course, Hillary will still be the favourite in this contest. After all, she has the money, the staff and a commanding lead in the polls. She also is a much more skilled operative, while Gore’s long rest from politics may have blunted his political skills. Gore may simply repeat the mistake of Edwards and go too far to the left, after all he endorsed Howard Dean in 2004 and has took a very defeatist line on Iraq. My back of the envelope calculations seem to estimate that there is about a 70% chance that Gore will run and a 30% chance that he could beat Hillary if he did so. This works out to roughly 21% chance that he could win the nomination. Given that contracts on him winning the nomination are trading at 13.0-13.1, Gore seems to be undervalued.

h1

GOP Primary Polls: Iowa, New Hampshire & South Carolina

October 8, 2007

The current state of play in Iowa, New Hampshire & and South Carolina

To get an accurate idea of how the state of play is in the three earliest Republican primaries, I put over month’s worth of polling data through Samplemiser. This is what I found out:

Iowa (as of October 3rd)

iowaoct03a.JPG

Mitt Romney 25.04% Rudolph Giuliani 14.99% Fred Thompson 14.61% Mike Huckabee 12.51% John McCain 9.33%

New Hampshire (ditto)

nhoct03a.JPG

Romney 27.29% Giuliani 20.02% John McCain 17.11% Thompson 8% Huckabee 7.85%

South Carolina

scaoct03.JPG

Thompson 20.49% Romney 16.35% Giuliani 16.29% John McCain 15.93% Huckabee 10.65%

h1

High Noon for McCain and Thompson

September 29, 2007

How the third quarter fudraising figures could be a make or break situation for both John McCain and Fred Thompson

The publication of Q3 quarter fundraising figures are always eagerly anticipated by political junkies, consultants and bettors. These are important both because money enables candidates to run an effective campaign but also as a gauge of their credibility. Although they are important for all candidates in both parties they are particularly vital for both Fred Thompson and John McCain. In the case of Thompson they are important because he needs to show that his delayed start has not damaged his status as the most credible challenger to Giuliani. Poor, or even middling figures, will start to increase the questions surrounding his commitment to the contest and his ability to win over the conservative wing of the Republican party. Although he has been catching up with Giuliani in the pollster.com analysis of national polls they have stopped increasing in New Hampshire and South Carolina. Poor fundraising figures could also tempt Gingrich into the contest, a move which would hurt Thompson more than any other candidate.

For McCain the problem is more immediate as his campaign is desperately short of cash. While the amount of money necessary to compete is not as big as has been supposed – after all Jesse Jackson managed to win a string of Democrat primaries in 1988 with a campaign that was essentially run out of a plane – anything other than stellar figures will be serious blow. However, there is silver lining in that a result that is bad – but just enough to leave him standing – might force him to reassess his strategy of moving to the right on domestic policy and might enable him to stop apologising for his last eight years in the Senate and run the sort of hacking slashing semi-populist candidacy that won him support from independants and nearly propelled him to the nomination, in 2000.

Indeed, the reason that McCain is still a viable candidate is because he has stood up for the foreign policy that he believes in – even when other in his party were losing their nerve and disassociating them-selves from it. Of course this doesn’t have to follow at all and poor fundraising figures could make him even more dependent on Rick Davis and even more inclined to compromise his beliefs to try to win acceptance from the angry wing of the Republican Party. He could also quit the primaries completely, though the fact that he has only a Senate race in 2010 (which has been made competitive by his compromises) suggests that he will stay in the race until the bitter end. There are also ominous signs that, not only are Giuliani and Thompson circling his supporters like vultures, looking to pick up his remaining supporters with protestation that, ‘if they were not candidates, they’d have supported him’, but even Bill Clinton is now following in their wake, suggesting that the battle over McCain’s bones (and remaining supporters), if it occurs, will be wide ranging.

So how should McCain and Thompson react if their numbers are bad? They will both need to use them to spur their respective campaigns, in Thompson’s case to get out and prove that he is really another Ronald Regan and in McCain’s case to show that he hasn’t abandoned his reform crusade. More specifically they both need to get in the face of their opponents, Thompson needs to attack Giuliani from the right, while McCain needs to put previous friendships aside and go after Thompson for his history as a lobbyist and as a personification of those who make a business, rather than a cause, out of fighting the culture wars. McCain also needs to make a public break with the special interest groups over either taxes or immigration, reminding the rest of the party that fiscal restraint applies to pie in the sky tax cut proposals as well as public spending.

In any case both McCain and Thompson are, ‘doomed to live in interesting times’, although whether that is a curse or a blessing will become apparent very soon.

h1

Yet more trades: You can call me Al

September 28, 2007

I bought 11 contracts of Al Gore (to be the Democrat nominee) at $0.86 each, leaving me $466.98 in my account in cash. Essentially, my reasoning is that Gore is the only candidate with the experience, grassroots support and name recognition to credibly challenge Hillary Clinton for the Democratic nomination. If you take the conservative view that he is 25% likely to run and 40% likely to win, then his price should be $1.00 (10) not $0.86.