politicalbetting.com

The favourites on both sides are Washington insiders

There was a time, 40 years ago, when a career in the US Senate seemed a prerequisite for the Presidency. In 1960, 1964, 1968 and 1972, both major party candidates were serving or former Senators. But Richard Nixon’s 1972 defeat of George McGovern (the candidates are pictured in a not-quite-full-colour “coffee cup poll”) was the last time this happened. Since then, no serving or former Senator has been elected as President, though four have received major party nominations (Mondale, Dole, Gore and Kerry).

But right now, the betting markets on Tradesports – the most liquid exchange at this stage in the race – have Senators as frontrunners for both the Democratic and Republican nominations. On the Democrat side, the favourite is Hillary Clinton, Senator from New York, whose candidacy has been covered on this site several times: most recently here. She can be backed at a probability of 43.8% (odds of 1.28/1). For the Republicans, the two favourites are Senators John McCain (Arizona) and George Allen (Virginia) – seemingly the man with the momentum this week – are almost neck and neck. They can be backed at 18.0% (4.55/1) and 20.4% (3.90/1) respectively.

Since the 1960s, the tenor of American political campaigning has changed: ironically, shifted in part by two of those Senators who went for the White House – Nixon and Goldwater. A candidate who can run as a “Washington outsider” tends to get the edge over a Senator whose past positions and movements on every issue can be traced through the voting records. Since Nixon, every elected President except the elder Bush has been a former state governor. Although Allen served from 1994-1998 as Governor of Virginia (a state which forbids governors serving consecutive terms) before entering the Senate, the “insider” perception may still stick to him.

Punters should consider avoiding the current favourites and looking towards the governors’ mansions for betting value.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.

…in New Zealand

In Saturday’s article we mentioned Centrebet’s market on the 17th September general election in New Zealand. Paradoxically inspired by Matthew Parris’s downgrading of the globetrotting political columnist…

It’s about the Game. It’s about jousting. It’s about personality, performance, plots, ploys and counter-ploys. With sinking heart I realise that I and my ilk are really no more than sports commentators of a rarefied sport. Adjust your settings and you can play it anywhere.

…let’s try to handicap the race.

The Labour party, led by Prime Minister Helen Clark, has led in the polls for the last few months, apart from one recent blip when Don Brash’s National party took a brief lead. Brash probably didn’t help himself after a recent debate between the leaders when he claimed to have “restrained himself” because his opponent is a woman.

But even if Labour is comfortably the largest party, piecing together a coalition government might not be straightforward. Currently, Labour and the Progressive party make up a formal coalition, with the Greens and the social conservative United Future party declining to bring the government down in key votes. The Greens are currently very close in the polls to the 5% threshold below which they would not be entitled to any seats in the list part of the election. (The electoral system uses a mixture of constituency seats and party lists; but the Greens are not in serious contention in any one constituency.)

Clark has been campaigning alongside the Green leader, Jeanette Fitzsimons, and must be hoping a few Labour supporters will vote tactically to keep the Greens in parliament. This hasn’t please United Future, however, which has promised to “slay the Green monster”. If the arithmetic works out, the Maori party might be able to prop up a Labour/Progressive/Green government even without United Future support; the polls see UF losing seats, though they are likely to remain with some representation through winning constituency seats.

Meanwhile, National would face its own problems in governing even if Labour failed to create a stable government. The ACT party, seen as its natural coalition partner on the right, is polling less than 2% and looking at being wiped out of Parliament – like the Greens with Labour, it wants to see National tacitly backing tactical voting.

Seen as the wildcard is the third-largest party, New Zealand First. Its leader, Winston Peters, is seen as a maverick with whom neither of the major parties really wants a deal. If NZ First is ruled out, getting to a parliamentary majority doesn’t look easy for either side.

The odds from Centrebet on which party will supply the next Prime Minister are 0.33/1 Labour, 2/1 National; a solid move to Labour since we last covered this market, during which time a NZ$20,000 (£7,800) bet went on Labour. Betfair’s market has picked up liquidity and has 0.41/1 Labour, 2.15/1 National.

With this level of uncertainty about the result, the shift in the odds towards Labour may have been an overshoot. But it’s a tough call. Maybe our settings need a bit more adjustment.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.

Birmingham Council House

Why Labour did too well in 2002

With the main electoral cycle over for the year, the next broad ballot box test for the parties will be May 2006’s English local elections in 176 urban and rural councils.

Local elections are not a perfect test of the parties’ national standings – local issues of course play their role, and turnouts are typically low. But historically they have been an opportunity for a protest vote against the government party. The results can shake a party’s confidence in its leader, particularly as the swing in vote share to the opposition tends to be magnified by differential turnout – while supporters of the government often sit it out at local elections, opposition voters are more likely to take the opportunity of getting out to show their anger at the government.

So is Tony Blair at risk from the aftershocks of a bad election performance next May?

The London borough and district council seats up for contention were last fought in 2002, when the Conservatives under Iain Duncan-Smith were making little headway in the polls. The Conservatives trailed on vote share in those elections by 3 points: by historical standards a disappointing performance for an opposition during a government’s second term. The metropolitan seats, on the other hand, were fought in 2004 which was a much worse year for Labour.

Although Labour has lost some councils which were once its strongholds (for example, Birmingham, England’s largest local authority, which has been controlled by a Conservative/Lib Dem coalition since 2004), the party has certainly not been wiped out locally. 61 of the 176 councils to be contested next May are still run by Labour or by Labour/Lib Dem coalitions. Labour still has a lot left to lose. In fact, with local elections often combining a protest vote against the local council with a protest against the government, the councils Labour still holds may be those where it does worst.

4th May 2006 has the potential to be a bad night for Labour. At this stage of the government’s life, the differential turnout effect at local level will be strong: the longer a government goes on, the more reluctant its supporters to turn out at anything but General Elections. Given this, there is no guarantee of Labour recovering to its 2002 performance, or even holding its poor 2004 share. With only English councils being contested next year, Labour will not have the advantage of its Scottish and Welsh strongholds being in play. Even in the relatively high turnout of this year’s General Election, the Conservatives were the narrow victors in the popular vote in England. And the Liberal Democrats made inroads in traditional Labour areas (though many Lib Dem victories at parliamentary level are built on the back of control of the local council, which creates the possibility of an anti-Lib Dem swing among voters who want to make their protest on local rather than national grounds).

Cantor Spreadfair has a spread of 118-133 weeks for the length of Blair’s 3rd term, corresponding to him remaining Prime Minister until August–November 2007. So the markets are not predicting that he will be blown off course by his local difficulties. But if there is going to be a wobble next year, the aftermath of 4th May might be the occasion for it.

As always, comments are very welcome from all site users, whether they are newcomers or regulars. In particular, contributions from people with knowledge of the areas where elections are taking place would be very interesting.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.

Is it the deputy leadership the only thing that Cabinet ministers are running for?

Since the sad death of Robin Cook, it’s been widely said that Gordon Brown was planning to choose Cook as his deputy when he assumed the leadership of the Labour party. No slight is remotely intended to Robin Cook – a principled and extremely gifted politician – in pointing out that it’s unlikely this was a foregone conclusion. Though the Chancellor and the former Foreign Secretary improved their relationship in the last few years, there was a bitter personal feud between them for 25 years. And to follow the Liberal Democrats’ example by putting two Scottish MPs at the head of the Labour party wouldn’t obviously have created the “balanced ticket” which is often a key factor in selecting a deputy.

But whether or not Cook was in line for the job, speculation has been boosted about who will be Labour’s next deputy leader. In The Times on Saturday, David Charter assessed the likely contenders, mentioning Work and Pensions Secretary David Blunkett, Foreign Secretary Jack Straw, Wales and Northern Ireland Secretary Peter Hain, party chairman Ian McCartney, Health Secretary Patricia Hewitt, and Trade and Industry Secretary Alan Johnson. It’s a clear and well-informed article, and worth reading in full.

The article closes with some betting odds for the deputy leadership: Johnson – popular across the party and especially with the trade unions – is 7/2 favourite, with his nearest rivals Blunkett (9/2) and McCartney (11/2). These odds don’t seem to be available online: they may have been quoted by a bookie who hasn’t made them widely available. Or of course David Charter may be a gambling fan and have made them up, in which case he would feel very welcome on this site.

Paddy Power is quoting some rather different odds online, with Blunkett as 7/2 favourite, followed by Jack Straw (4/1), Charles Clarke (9/2) and Johnson (11/2).

All of this assumes Gordon Brown will be the next leader of the Labour party. But what if he isn’t? The next few years aren’t without their risks to him: an economic downturn would hit his fortunes harder than anyone else’s. And reading about the views of Mo Mowlam (not an uncritical ally of Blair) that Brown’s personality made him “unfit to be Prime Minister” does suggest that other senior Labour figures may privately feel the same way.

Labour’s deputy leader is elected by the same electoral college as the leader, with votes split equally between the MPs and MEPs, individual members, and trade unions. So anyone looking to build popularity for a deputy leadership race is also focusing on winning over the people who elect the leader. Being established as the favourite for the deputy’s job could be very handy if it turns out Brown doesn’t have the leadership sewn up. And in fact, Alan Johnson is the second favourite at 11/1 to be the next Labour leader. Not bad odds for someone who seems popular with the people who matter.

The problem? It might be hard to have it both ways for too long. If things do go smoothly for Gordon Brown, the party is likely to listen to his guidance on whom he wants as his deputy. But if things go awry, anyone who has stayed too close to Brown may suffer with him. The Chancellor is not reputed to be patient with those who aren’t his wholehearted supporters. If the deputy leadership contenders want to keep their options open, they have a careful path to tread.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.

What will the British political landscape look like in July 2012?

It’s easy for political gambling enthusiasts to get carried away and forget how tiny a market our hobby is compared to sports betting. For example, about £150,000 of betting on the Conservative leadership has gone through Betfair so far. That’s less than 5% of the trade on Sunday’s Chelsea–Arsenal game.

However, William Hill seems to be aiming at some crossover marketing, with a selection of markets themed around the 2012 Olympics in London.

Some are specific to the Games themselves – for example, Sir Steve Redgrave (pictured) is 4/1 favourite to light the Olympic flame at the opening ceremony. But most of the markets on offer enable punters to bet on what will be happening in other areas of national life when the Olympics open on 27th July 2012.

You can get 20/1 against Tony Blair still being Prime Minister then – by which time he would have to have won a fourth general election and would have spent over 15 years at the helm, longer than anyone since William Pitt the Younger, and the third longest term of all time. These odds are more generous than Ladbrokes’ now discontinued 16/1 against a fourth Blair term – though of course in that case you would still win if he retired in 2011, say.

If you think Blair will go before then, and take his party with him too, the odds on offer are 6/4 against a Conservative Prime Minister on the day of the opening ceremony, or 66/1 against a Liberal Democrat. This is largely a bet on the 2009 or 2010 General Election, where Conservative backers can get better odds of 1.75/1 against the Tories being the largest party. If you think a Conservative/Lib Dem coalition is possible, however, you may prefer the 6/4, which would pay off if Labour were the largest party but the PM a Conservative.

The winner of the June 2012 election for London Mayor will be rewarded with having the Olympics during his or her honeymoon period. The two candidates for whom William Hill is quoting odds are the Labour incumbent Ken Livingstone (50/1) and the Conservative peer, former MP and head of London’s bid for the Games, Lord Coe (33/1). Both of these prices seem generous. Livingstone, though divisive, works the media extremely well, he manages to retain considerable personal popularity and he is not too old to be entirely ruled out; he would be 66 at the time of the 2012 election. Coe, meanwhile, has the advantage of an impressive career outside politics – he would be the kind of candidate who had a good shot of breaking out of the Tories’ image problems. The question is whether he would want to return to partisan politics rather than continuing a popular and non-partisan role through to the end of the Olympics.

(Of course, there is another mayoral election before that, in 2008, which we’ll cover in another article shortly.)

The snag with all of these bets is that your money is tied up until 2012 and you cannot take profits early. You also need to consider the interest you would forego on your stake. You can bet on the pound remaining the national currency at the time of the Olympics – but at odds of 0.22/1, your return would hardly be better than from putting your stake in a savings account. This seven-year itch will probably keep most gamblers from any serious bets in these markets. But nevertheless it’s good to see the profile of political betting raised by tying it in with sporting events.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.

Sunday’s stories sifted

As usual for August, it’s a quiet weekend for political news, but a few pieces in today’s papers will interest political gamblers.

The Conservative leadership has been a reliable source of interest since May, and continues to provide stories. The talk at the moment is of whether Kenneth Clarke and David Cameron can present a united front in a “dream ticket”. The Sunday Times reports that Lord Heseltine is backing a bid led by Clarke with Cameron as his deputy. However, with press coverage on Friday and Saturday reporting that Clarke supporters such as Tony Baldry moving to Cameron’s camp, there must be a question on whether Heseltine is really in touch with the situation in the parliamentary party. The Observer reports that Clarke would give up his business interests in companies such as British American Tobacco if he became leader, but not during a leadership contest. This will prompt some to wonder whether he really believes he can win. The article also mentions scepticism over whether Cameron’s supporters would back a “dream ticket”. Betting odds are 4.3/1 Cameron, 9/1 Clarke, with David Davis still favourite at 0.71/1.

The Observer also reports that Mo Mowlam regarded Gordon Brown as unfit to be Prime Minister. One might speculate on how many other Labour figures privately feel this, but with no clear challenger Brown remains the strong favourite to succeed to the Labour leadership, at 0.28/1.

Scotland on Sunday – the Sunday edition of the Scotsman, which has excellent coverage of UK-wide as well as Scottish politics – reports on the selection of a Labour candidate to fight the by-election in Livingston. Five contenders are mentioned; with all of them having local connections, Labour seems to be doing the right thing to avoid a serious challenge from the SNP or Liberal Democrats. No betting markets seem to be open on the by-election result yet.

Finally, looking overseas, the Washington Post reports that Senate Majority Leader Bill Frist, once seen as a leading candidate for the Republican presidential nomination in 2008, is spending more time than expected with his Tennessee constituents. The paper speculates that he will abandon his White House ambitions and run for re-election to his Senate seat in 2006 after all. Frist, as a respected Senator but very poor media performer, would probably find a happier outcome this way. The Tradesports exchange rates Frist as an 8% chance (odds of 11.5/1) for the presidential nomination, with no odds on the Tennessee Senate race yet.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.