Follow the Money: The Republican Nomination’s Invisible Frontrunner
“Follow the money.” It’s the all-encompassing answer when you want to get the real dirt on what’s going on in the world.
So why are we not doing it with the 2016 Presidential Election?
Sure, there has been much written about the influence of super PACs, percentages of micro-donors, and the burn rates of the major candidates and what all those metrics mean for their chances of victory, but what does the smart money say?
By smart money, I’m not talking about Peggy Noonan or writers at The Washington Post, or even The Hill. Of course, I am talking about the betting markets.
Now, in the US, most online gambling is prohibited in most places, but if you look to Europe, you might be surprised by what you find.
I have been following the 2016 Republican and Democratic nomination processes like many others in the US. I have been reading blog posts, articles in various major publications, reading live tweets during every debate and I have stayed up to date on the latest national polls, as well as those in Iowa and New Hampshire.
What I hadn’t done was visit the betting markets. After a cursory glance at the betting markets, I feel like I now have a much better idea of who the candidates will be.
If you watch MSNBC or CNN or Fox News, you might think you have a good idea of who the Republican nominee will be.
It was the Summer of Trump™, and his poll numbers surged to over 30% of Republican voters nationwide. It has been all Trump, all the time, and only recently has his frontrunner status been called into question.
Today’s front-page story on the New York Times? “Carson Snatches Trump’s Lead in Latest National Poll”
Okay, so is that where the smart money is heading? Did the betting markets predict this surge in Carson’s popularity?
In fact, the betting markets have an altogether different frontrunner.
Okay, you’re now saying. I know who it is. It’s the Mitt Romney type, the guy who didn’t rouse Republicans’ passions, but who was clearly the most middle-of-the-road electable candidate, who had some great executive experience as the governor of a prominent state. It’s Jeb!, you say.
Any guesses yet?
And no, it’s not the business-minded Carly Fiorina, who has had a couple of top-notch debate performances to thrust herself into the mix.
If you said Marco Rubio, you win the prize. Now, you say, come on, he might be the frontrunner, but that’s only because he’s not totally nuts like Carson and Trump, and he’s probably just edging the rest of the field, right?
No, not really.
As of October 27, on Paddy Power, Rubio sits as the 2/1 favorite to win the Republican nomination. Jeb sits in second place at 11/4, followed by Trump (10/3), Fiorina (10/1), and Carson (10/1).
It’s not super close. And more interestingly to me, this odds placement doesn’t directly reflect any of the day’s polling numbers!
Take the RCP national poll averages from the same day (10/27): Trump 26.8%, Carson 22.0%, Rubio 9.0%, Jeb 7.0%, Cruz 6.6%, Fiorina 5.8%.
Fair enough, Rubio sits in a strong third place. But enough to install him as the odds favorite?
In Iowa, often a bellwether state which yields to the winner increased popularity and donations, Rubio is doing only a little better than his national average. He’s still in third place but with 10.2% of the vote.
In New Hampshire, Rubio sits in fourth behind Bush, with only 8.3% of the vote. In South Carolina, 3rd place again with only 8.0%.
Are you as confused as me yet?
Okay so his poll numbers aren’t there yet. But maybe he is winning the money race.
Here is the latest available data for fundraising rankings (money raised in the 3rd quarter). In fundraising, Rubio finished 7th among all candidates behind Clinton, Sanders, Carson, Bush, Ted Cruz (!) and Fiorina.
In terms of money on hand, he is in fifth place with $11.0 million. Again, not terrible for his campaign, but this makes him the favorite?
In terms of small donations of $200 or less, which is often thought of as a stand-in for who has the most grassroots support, Rubio ranks an abysmal 11th among all candidates, with only 27% of his donations coming from those sources. That’s a lower percentage than “glad to be there” candidates like Jim Webb, Mike Huckabee, and Lincoln Chafee.
Okay, you’re saying, what about super PACs? Surely, he must be collecting money hand over fist there. Well, sort of. Through June 30, Rubio had raised $32.1 million from super PACs and “other groups.” That is a lot, but it pales in comparison to Jeb’s $108.5 million, and puts Rubio in 3rd place among Republicans in super PAC money behind Cruz’s $38.4 million.
Again, not terrible, but not the kind of fundraising ammo that will be blowing his competition out of the water.
So my question is, what is the real reason behind Rubio’s backing in the betting markets? Has there been an invisible primary among the leaders of the Republican party since it appeared that Jeb didn’t have the campaigning skills necessary to hoist the nomination?
Was there a decision made that Rubio’s youth and roots would make him the most electable candidate out of the vast Republican field? If so, when will the next phase of this process become apparent to the laypeople like me, otherwise known as “the electorate”?
Just watch. I predict that we will see the late shift towards Rubio, much like we saw with Romney 2012.
In fact, don’t just watch for it. Bet on it.