American politics: GOP nomination

America is more than a year away from their 2012 Presidential election, but things are already heating up. The “Grand Old Party” (GOP) of the Republicans are starting their process of picking their Presidential candidate to take on Obama, and as yet it is still a very open race. One interesting element of this nomination race is that there is growing strength among the non-establishment “outsider” candidates. It is still more likely that a “mainstream” candidate (Romney, Pawlenty, Huntsman, Perry) will win, but the “outsiders” (Bachmann, Paul, Cain, Palin) are all within striking distance.

So with only a little bit of poetic licence, I will run through the candidates in pairs… matching an “insider” and an “outsider” together for each category.

Frontrunners — Mitt Romney (establishment) v Michele Bachmann (outsider). Romney has been leading in all major polls since the start of the race, but many consider him to be a soft leader who is in front mostly on name-recognition. He was a contender in the 2008 nomination race before losing out to John McCain. Bachmann has been the outsider who has caught the most momentum in recent weeks, leading the polls in some states (all important Iowa) and second in others (New Hampshire). The problem with Romney is his history of supporting a health mandate and seemingly changing his opinions to suit the circumstances. Bachmann is considered more of a conviction and “tea party” politician, but lacks the experience and as a “mini-Palin” has occasionally suffered from “foot-in-mouth” disease. She’s free-market and socially conservative.

Just behind — Rick Perry (establishment) v Ron Paul (outsider). Rick Perry hasn’t entered the race yet, but if/when he does he will automatically be in the mix as he is already polling at or above 10%. In some ways he is a cross between Romney & Bachmann… with the experience and credibility of Romney but with some of the conservative convictions of Bachmann. He has previously voiced sympathy with the “independent Texas” movement, but some question whether America is ready for another Texan governor (following Dubya). On the other side is libertarian favourite Ron Paul who has consistently been coming in near the top of the polls (around 10%) and came in second in fund-raising so far. The principled doctor now has a more professional campaign, but he is still being over-looked by many in the media.

Probably won’t run — Rudy Giuliani (establishment) v Sarah Palin (outsider). Both Giuliani and Palin consistently figure highly in the polls (around 10%) but it’s not clear whether they will enter the race. While Palin consistently scores highly on likeability for Republicans, she also scores very high in unlikeability and does poorly in match-ups with Obama. At the moment it seems that her support is shifting over to Bachmann as the “new Palin”. If either of these candidates run they will join the top-tier and make it very difficult for the below candidates to rise.

Waiting in the wings — Tim Pawlenty (establishment) v Herman Cain (outsider). The insider media has been talking up Pawlenty for a while, but he doesn’t seem to be getting traction in the polls. He still has enough money and support to be a viable challenger, but at the moment he is running just off the pace. Cain also has enough support to be taken seriously, but not enough to be considered strong. For a while there was a whisper that he could be the dominant outsider candidate, but his support has fallen off in recent weeks as Bachmann stole the prize of “favourite outsider”. Cain is unique in this race both for being the only black candidate and also because he’s the only non-politician… instead making his name as CEO of a pizza chain. Both pitch themselves as solid conservatives.

2 percent — Jon Huntsman (establishment) v Newt Gingrich (outsider). Huntsman is probably the most “moderate” candidate in the field and it is thought he could do quite well against Obama… so long as he can get the nomination. He is the second Mormon in the race (along with Romney), is considered a “social liberal”, is fluent in Chinese, and currently lagging in the polls. He needs Giuliani to stay out of the race and Romney to stumble, and then he could be a strong challenger. Gingrich was the house majority leader back in the 90s and has a small band of dedicated followers, but he is also the most hated of all the candidates and his campaign seems to be stuck in first gear.

1 percent — Rick Santorum (establishment) v Gary Johnson (outsider). These guys are rank outsiders and are sometimes not even included in mainstream polling. Santorum is known for his socially conservative views while Gary Johnson is a pro-choice libertarian. Johnson is my personal favourite in the race, but I’m not holding my breath. He was a two-term governor in a Democrat state, has a proven record at cutting the size of government, and has climbed mount Everest… but nobody seems to be listening.

The betting markets suggest that the nomination is still most likely to go to an establishment candidate — Romney, Perry, Pawlenty or Huntsman. Though obviously Pawlenty and Hunstman have a lot of work in front of them to get their poll numbers up to match the betting odds. Bachmann is the most likely outsider, while the betting markets don’t like the libertarian candidates, significantly discounting Paul & Johnson.

Romney — 32%
Pawlenty — 15%
Huntsman — 12%
Perry — 12%
Bachmann — 6%
Palin — 6%
Cain — 4%
Paul — 3%
Gingrich — 2%
Giuliani — 2%
Santorum — 1%
Johnson — 0%

It’s hard for me to list my order of preference, because there are a lot of candidates who I am largely indifferent to or simply don’t know well enough to make an informed opinion. They are all now saying whatever they think they want the public to hear, which makes it hard to learn about them. Obviously, I prefer Gary Johnson and Ron Paul as the libertarian candidates in the race, but beyond that it’s hard to pick. Perry talks the talk on cutting government and states rights, and Huntsman is a social liberal who has cut taxes and opposes corn subsidies. I can’t think of any good reasons to get behind Giuliani or Romney, while Santorum and Pawlenty are probably too socially conservative for my liking.

Whoever wins, my great hope is that they are able to balance the budget and pay down the debt. The growing fiscal crisis in America is leading to inflationary monetary policy, which is seeing the US dollar fall compared to more stable currencies like the Australian dollar. And since I have various investments in US dollars, their falling dollar is hurting my portfolio. I am in effect being taxed by the US government because they don’t know how to run a budget.