I have to wonder if we are seeing the same mispricing of risk in the 2008.PRES.McCAIN and 2008.PRES.OBAMA markets.
Investors are giving McCain a mere 15.2% chance of winning this election. And even that seems generous compared to the electoral college polling.
Are Intrade markets, however, failing to price in the risk of voting fraud?
Both campaigns are now warning of fraud and, yet, the markets look priced to perfection. Just like the stock markets before they collapsed.
While Obama is, as the markets reflect, far ahead in all the polls, favorability ratings and enthusiasm levels, what exactly are the algorithms that will translate these numbers into a vote?
Part of the reason that financial investors, for example, mispriced risk was that trading desks used proprietary algorithmic trading models they claimed almost eliminated risk. It turns out those algorithms weren't so miraculously immune to risk, or fraud, after all. As those trading desk algorithms are proprietary, of course, investors will never know just what formula it was that wiped out their net worth.
But just as triple AAA rated Collateralized Debt Obligation suddenly became worth 9 cents on the dollar, can five votes become worth say just one vote with the proprietary software running the electronic voting machines? Or, as I like to call them - the Miracle 51% voting machine.
The past two elections in America have been marred by the suspicion of not quite fair elections thanks to these electronic voting machines that, for example, gave sometimes drastically different results from the exit polls. Conveniently, the final results were so close that it was hard to cry 'foul' without seeming a poor loser. While the exit polls, of course, may have been inaccurate, we will never know if the voting machines were, too, as they leave no record and there is no way to examine the proprietary software on which the voting machines operate.
Remarkably, these paperless voting machines are apparently still around in several states.
And in West Virginia, where Intrade is giving McCain a 75% chance of
winning, there are already reports of votes for Obama 'flipping' to McCain.
The Charleston Gazette reports:
Three Putnam County voters say electronic voting machines changed their votes from Democrats to Republicans when they cast early ballots last week. .No case of a Republican vote flipping Democrat has yet been reported.
This is the second West Virginia county where voters have reported this problem. Last week, three voters in Jackson County told The Charleston Gazette their electronic vote for "Barack Obama" kept flipping to "John McCain".
In both counties, Republicans are responsible for overseeing elections. Both county clerks said the problem is isolated.
Aside from the electronic voting machines, there is the old fashioned variety of vote suppression.
Robert Kennedy Jr. and Greg Palast argue in the latest issue of Rolling Stone that the election has, in fact, already been stolen and McCain is the 'winner:'
In state after state, Republican operatives — the party's elite commandos of bare-knuckle politics — are wielding new federal legislation to systematically disenfranchise Democrats. If this year's race is as close as the past two elections, the GOP's nationwide campaign could be large enough to determine the presidency in November. "I don't think the Democrats get it," says John Boyd, a voting-rights attorney in Albuquerque who has taken on the Republican Party for impeding access to the ballot. "All these new rules and games are turning voting into an obstacle course that could flip the vote to the GOP in half a dozen states."Voter fraud has been a big issue in recent US elections. In the 2004 and 2006 election cycles, Republicans alleged widespread voting fraud by Democrats. They are now doing it again with the 2008 election.
But doth the elephant protest too much?
David Iglesias thinks so. As the FBI begins probe of a group called Acorn Iglesias had this to say:
"I'm astounded that this issue is being trotted out again," Iglesias told TPMmuckraker. "Based on what I saw in 2004 and 2006, it's a scare tactic." In 2006, Iglesias was fired as U.S. attorney thanks partly to his reluctance to pursue voter-fraud cases as aggressively as DOJ wanted -- one of several U.S. attorneys fired for inappropriate political reasons, according to a recently released report by DOJ's Office of the Inspector General.And while the media is amplifying the Republican claims that Democrats are involved in widespread voter fraud via Acorn, a Republican operative has been quietly arrested for voter registration fraud in California:
The owner of a firm that the California Republican Party hired to register tens of thousands of voters this year was arrested in Ontario over the weekend on suspicion of voter registration fraud...Regardless of whether or not any of these cases of voting registration fraud translates into actual voting fraud, the one thing that is clear is that the integrity of the US voting system is becoming increasingly suspect.
State and local investigators allege that Mark Jacoby fraudulently registered himself to vote at a childhood California address where he no longer lives so he would appear to meet the legal requirement that all signature gatherers be eligible to vote in California. His firm, Young Political Majors, or YPM, collects petition signatures and registers voters in California and other states..
Jacoby's arrest by state investigators and the Ontario Police Department late Saturday came after dozens of voters said they were duped into registering as Republicans by people employed by YPM. The voters said YPM workers tricked them by saying they were signing a petition to toughen penalties against child molesters..
The firm was paid $7 to $12 for every Californian it registered as a member of the GOP.
And with so many charges of voting fraud out there, it would seem there is no smoke without fire.
I don't buy Republican suggestions that Obama would need to participate in all the fraud they allege is happening. What on earth would be the point? Usually it's the guy behind in the game that needs to cheat. And the US ain't Russia where 90% wins are deemed necessary.
Nor am I convinced, however, by Kennedy and Palast's theory that the election has already been stolen for McCain. Unlike 2000 or 2004, all the polls and markets are just so overwhelmingly indicating an Obama landslide. And the $150 million raised by the Obama campaign in September suggests millions of American voters have skin in this outcome - unlike 2004 when Kerry support was always lukewarm, for example.
No. The Kennedy-Palast scenario is just too difficult to do in 2008. Such a theft could only happen if the resulting win is plausible. There would just be way too much explaining to have to do.
Furthermore, even the giants of the Republican party and/or Conservativism are planning on voting for Obama:
Christopher Buckley, son of William F., endorsed Obama:
Colin Powell announced on Sunday that he is endorsing Obama.
Obama has in him—I think, despite his sometimes airy-fairy "We are
the people we have been waiting for" silly rhetoric—the potential to be
a good, perhaps even great leader. He is, it seems clear enough, what
the historical moment seems to be calling for.
So, I wish him all the best. We are all in this together. Necessity
is the mother of bipartisanship. And so, for the first time in my life,
I'll be pulling the Democratic lever in November. As the saying goes,
God save the United States of America.
"I firmly believe that at this point in America's history, we need a president that will not just continue, even with a new face and with the changes and with some maverick aspects, who will not just continue basically the policies that we have been following in recent years," Powell said..Endorsements galore from Republican leaning newspapers are also inconvenient to the Kennedy-Palast scenario.
"I think we need a transformational figure. I think we need a president who is a generational change and that's why I'm supporting Barack Obama, not out of any lack of respect or admiration for Sen. John McCain."
.... Powell went on to say of Governor Palin . . .
"I don't believe she's ready to be president of the United States."
The Chicago Tribune in their first Democratic Presidential endorsement ever:
McCain failed in his most important executive decision. Give him credit for choosing a female running mate--but he passed up any number of supremely qualified Republican women who could have served. Having called Obama not ready to lead, McCain chose Alaska Gov. Sarah Palin. His campaign has tried to stage-manage Palin's exposure to the public. But it's clear she is not prepared to step in at a moment's notice and serve as president. McCain put his campaign before his country.The Salt Lake Tribune:
Then, out of nowhere, and without proper vetting, the impetuous McCain picked Alaska Gov. Sarah Palin as his running mate. She quickly proved grievously underequipped to step into the presidency should McCain, at 72 and with a history of health problems, die in office. More than any single factor, McCain's bad judgment in choosing the inarticulate, insular and ethically challenged Palin disqualifies him for the presidency.The LA Times, which has not endorsed a Presidential candidate in decades:
Indeed, the presidential campaign has rendered McCain nearly unrecognizable. His selection of Sarah Palin as his running mate was, as a short-term political tactic, brilliant. It was also irresponsible, as Palin is the most unqualified vice presidential nominee of a major party in living memory. The decision calls into question just what kind of thinking -- if that's the appropriate word -- would drive the White House in a McCain presidency. Fortunately, the public has shown more discernment, and the early enthusiasm for Palin has given way to national ridicule of her candidacy and McCain's judgment.Regardless, both sides are gearing up with massive legal teams - one to prevent certain voters from voting and the other to ensure certain voters can vote.
Bloomberg reports in "Obama Assembles US's 'Largest Law Firm' to Monitor Election:'
I think election night is going to be a lot longer than most people think.
In Florida, Democratic lawyer Charles H. Lichtman has assembled almost 5,000 lawyers to monitor precincts, assist voters turned away at the polls and litigate any disputes that can't be resolved out of court."On Election Day, I will be managing the largest law firm in the country, albeit for one day,'' said Lichtman, 53, a Fort Lauderdale corporate lawyer and veteran of the five-week recount after the 2000 election when Florida eventually delivered the presidency to George W. Bush.
And, heck, at only 15.2, 2008.PRES.McCAIN looks like a potentially profitable hedge against the risk of a hologram of an election.