Sunday, January 22, 2012

The Florida Firewall

Newt Gingrich's dramatic comeback in South Carolina has recast the Republican race through a new lens.  A week ago, we all believed that Mitt Romney won Iowa, he dominated in New Hampshire and was well on his way to winning South Carolina.  The Florida race was almost an afterthought as everything would be done but the crying if he swept the first 3 contests.

We have since learned that, in fact, Rick Santorum won the Iowa Caucuses.  Granted, the difference between an 8 vote win by Romney (as we thought on caucus night) and a 34 vote win for Santorum (as we have since learned) is largely psychological - they still both get 7 delegates in either scenario, but the psychology is important, because I firmly believe that the Santorum surge in New Hampshire would have been larger had people known he had won the first race.

The psychology now is that the race is 1-1-1 headed to Florida.

If we look to history in who will win this race, it does nothing but confuse us. I wrote an earlier blog showing how it has always been essential for a prospective GOP nominee to win either Iowa or New Hampshire.  The other historical fact that I hadn't mentioned is that the ultimate GOP nominee has also won South Carolina every race in the past 30 years.  Being that Gingrich won South Carolina but not Iowa or New Hampshire, one of those two historical trends is about to be broken.

Florida is an odd beast for the next race.  The state itself is a swing state, but its primaries are closed (neither Independents nor Democrats can participate) as opposed to the open primary we just saw, so the primary electorate tends to be fairly conservative.  Tea Party loyalist Marco Rubio thumped well-established moderate Charlie Crist in the GOP Senate primary in 2010.

All of the polls to date show Mitt Romney with a 20%+ lead over both Santorum and Gingrich.  But if we've learned anything in the past week, it is that those numbers can shift and fast.  And they will.  When new polls come out early next week that are sampled after the Gingrich win in South Carolina, he will be a lot closer.  Whether he can win remains an open question.

Romney will come out punching a lot harder - he has to.  The negative ad money will be mind-boggling on all sides of the campaign.  And, as has been the trend this year, the two debates in Florida next week will be critical to determining the fate of the race.

Mitt Romney is still the favorite to ultimately wrap up the GOP nomination.  After Florida, we have the Nevada Caucus 4 days later, which would seem inhospitable turf to Gingrich (although it's a race that Ron Paul could surprise in), then 3 days after that two meaningful primaries (Colorado and Minnesota) and one primary that doesn't count (Missouri holds a primary but awards delegates based on a caucus later in the season...Gingrich isn't even on the ballot in the Missouri primary.)  There are a few events over the next few weeks, including the Maine Caucus on Feb 11, big ticket primaries in Arizona and Michigan on Feb 28 and the Washington caucus on Mar 3.  But the big prize is Super Tuesday, March 6, where 10 states hold nominating contests at once. 

Whether Gingrich can compete on a Super Tuesday scale is directly related to whether he can show well in the states leading up, and most critically Florida.  If he finds a way to pull off an upset in Florida, then I would place him at even money with Romney to win the nomination.  If Romney wins Florida soundly, it will silence the Newt momentum.

As of this morning, Intrade has the odds on an ultimate Mitt Romney nomination at 72%.  But they were over 90% a week ago.

Somewhere in the White House, Barack Obama is letting out a laugh.

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