Archive for August, 2005

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Labour’s little looming local difficulties

Wednesday, August 24th, 2005

Birmingham Council House
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.



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Are their eyes really on second prize?

Tuesday, August 23rd, 2005

Is it the deputy leadership the only thing that Cabinet ministers are running for?
Runner-up medal
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.



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Olympic gaming

Monday, August 22nd, 2005

What will the British political landscape look like in July 2012?
Sir Steve Redgrave winning Olympic gold
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.



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Sunday press roundup, 21st August 2005

Sunday, August 21st, 2005

Sunday’s stories sifted
Printing press
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.



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Saturday markets update, 20th August 2005

Saturday, August 20th, 2005

New, moving and interesting markets this week
Trading floor
We haven’t seen too much dramatic action in the betting on British political events this week, so let’s take a weekend look further afield.

Though when we mention Helen Clark on this site, we tend to be referring to the former MP for Peterborough, there is more betting interest in her antipodean namesake. New Zealand is less than a month from its general election, to be held on 17th September. Australian bookie Centrebet will accept bets in sterling, and has a tight book with odds of 9/20 on Clark’s Labour government, and 31/20 against Don Brash’s National opposition. Betfair also has a market, but there is not much liquidity yet and the odds on both sides are poorer.

Across the Tasman Sea, Centrebet also has a market on the next general election in Australia. With the election likely to take place in 2007, this is probably one for the enthusiasts at this stage. However you can get odds of 11/20 on the Liberal/National Coalition and 13/10 against Labor. Prices are also available on the Liberal leader at the election. Current PM John “call me mate” Howard is the favourite at 33/50 to fight his sixth general election. (He lost his first election, and the party leadership, in 1987, only to make a subsequent comeback which must be a source of enduring hope to William Hague.)

The Irish-based Tradesports exchange focuses on US sports and events and includes a good range of political markets. For the 2008 presidental nominations, Hillary Clinton is the hot Democratic favourite at a probability of 43% (odds of 1.33/1). Among the Republicans, the field are closer together, but the marginal favourite is Hillary’s recent Arctic travelling companion, John McCain, at an implied probability of 19.7% (odds of 4.08/1).

You can also back the Democrats to hold the New York Senate seat in November 2006 – in effect, Hillary to be re-elected – at a probability of 82% (odds 0.22/1). For an incumbent with strong statewide approval ratings in a Democratic state, this must be good value. Bear in mind though that your stake and return are in US dollars, so British gamblers are exposed to currency risk and bank charges.

In Germany, the centre-right remains ahead in the polls, with the CDU/CSU/FDP alliance, led by Angela Merkel, looking to have a good chance of winning a majority of the popular vote on 18th September. Even failing that, it is difficult to envisage the CDU not ending up the largest party. But with the best value available on a CDU win at a modest 6/100, punters would surely need quite some faith in the predictability of politics. Tradesports offers very slightly better value, but once again this comes with the complication of currency risk.

There are no markets yet on Japan‘s 11th September election, which looks set to be closer than is usual there, with wide divisions opening in the governing Liberal Democratic party. The conventional bookies may not want to take the risk of offering odds on a subject they don’t know well, but a betting exchange would be able to offer the interested an opportunity to bet against one another.

I hope to cover some of these markets further in the next week, and comments from anyone with an interest in them would be much appreciated.

Newcomers are as welcome as regulars in our discussion section, and there is no need to register with the site – just click the Comments link below, enter a name and email address along with your comment, and it will be published.

Best of luck with your betting.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.



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Does the Conservative electoral system matter to gamblers?

Friday, August 19th, 2005

Would Tory members rally around a candidate rejected by MPs?
Iain Duncan Smith at Conservative conference
Last month, the Conservative parliamentary party voted to accept a proposed change to the party’s constitution which would return to MPs the final responsibility of electing the party leader. In the last contested election, in 2001, Conservative members chose Iain Duncan Smith, despite his having come second to Kenneth Clarke in the MPs’ ballot.

The constitutional amendment must be ratified by a two-thirds majority of the party’s national convention on 27th September, so it is a topic that is still open and still controversial, with the change bitterly opposed by some Conservative members such as our regular contributor “Wat Tyler”, and former MP and chief executive Barry Legg. The uncertainty in exactly how the new leader will be chosen may have made some gamblers wary of making their bets up till now.

But this week, the Guardian‘s Michael White has reported that frontrunner David Davis is not taking sides on the issue. Davis is certainly not ignorant of tactical considerations, and his motivation may be that he can only cause antagonism by adopting a position on an event where he has little influence on the outcome. But he may also have decided that he can win on either system. Similarly, Smiths fan David Cameron may be wondering to himself: “What difference does it make?”.

There seems a pretty good case for saying: it makes none. Discussions between Tory activists who comment on this site tend to put them largely into Davis and Cameron camps – just like the party in parliament. It doesn’t feel as if the difference between MPs and members is big enough for one side to reverse the other’s decision, 2001-style. (And even then, rumour has it that Clarke’s total in the MPs’ vote was inflated by Duncan Smith supporters voting tactically to keep Portillo out of the members’ ballot.)

For gamblers, the key question about the electoral system has been on what it does to Kenneth Clarke’s chances. It’s been reported that Clarke will stand only if MPs have the decisive vote. Conventional wisdom says that the members will never choose him due to his history as an EU enthusiast, whilst the MPs are more inclined to compromise for his advantages in voter perception. But do MPs really feel so differently about Clarke? At every election the parliamentary party becomes more EU-sceptical and younger, with less “living” memory of Clarke’s effectiveness at the despatch box. Around a quarter of the current parliamentary party were newly elected in May this year.

At 9/1, it may be worth backing Clarke in the hope that his odds will shorten as he confirms his decision to stand, and you can then lay off at a profit on Betfair. But don’t aim beyond a modest return from this strategy: holding onto a Clarke bet until the end isn’t advised.

Philip Grant
Guest editor

Mike Smithson is on holiday until 5th September.



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A break from all of this….

Thursday, August 18th, 2005

…. ….

    ….but we love it really

This is my last posting before my wife Jacky and I travel to our holiday cottage near Biarritz in South-West France and for the next two and a half weeks Philip Grant (Book Value) will be Politicalbetting’s guest editor.

September looks like being an interesting month for political gamblers. There’s the German General Election which might not be as easy for Angela Merkel as seemed probable two or three months ago.

Then there’ll be the party conference season opening with the Lib Dems in Blackpool – the first gathering of the party since the General Election. Will Charles Kennedy sail through that or could the mood amongst delegates be that they a new leader to fight the next General Election?

The Labour conference might produce further clues about when Tony Blair will be stepping aside. We’ve been saying since the General Election that this will happen later rather than sooner and the betting markets have moved in that direction.

Finally the Tories will first decide how they will elect Michael Howard’s replacement and then there will be the contest itself. David Davis looks very strong but how will he compare when faced with the intense scrutiny of the party conference?

Meanwhile a success with ICM. After our complaint to the British Polling Council ICM have now released the full data set of their July Guardian poll and we can see the numbers they are using to weight their samples. There’s plenty there for me to get my teeth into when I return.

Over to Philip.

Mike Smithson

Animations courtesy of http://www.horton-szar.net/clipart/



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The disappointing summer of Sir Malcolm Rifkind

Wednesday, August 17th, 2005


mr

    Does John Major’s Foreign Secretary stand an earthly?

Our chart based on the best betting prices showing the implied probability of Malcolm Rifkind becoming Tory leader says it all. After an early flurry in the first week or so of the campaign when it touched 10% the Rifkind figure has slipped to barely a third of that. Even Rifkind’s much publicised “Tories are defective” statement at the weekend has not given him the boost he must have hoped for.

    Given that this speech was a sharp attack on the way his party had handled its first eight years in opposition it was always going to be something of a gamble.

To non-Tories much of what he said appeared correct yet the problem for the party is that it is probably not yet ready to be told it. You have been hyped up to fight an election on one basis and it must be difficult to acknowledge that this was wrong. Rifkind’s approach had a similar feel to it to the famous party conference “nasty party” speech by the former Chairman, Theresa May.

A further challenge for Malcolm Rifkind is that he will always be associated with the 1992-1997 Government of John Major.

    Like Ken Clarke he was a key player during those critical years when Tony Blair shifted the political centre of gravity by totally transforming the way that the electorate saw the two main parties. The Tories were demonised and so it remains.

Rifkind’s strategy must be to stay in the race until the party conference and then hope that in the intense media glare the qualities that he brings might shine through. For there’s little doubt that he’s one of the best orators and he is certainly ahead of the front-runner, David Davis, in this regard.

Is we worth the current 34/1? The price seems about right and I have a weakness for long-shots.

Mike Smithson