US primary picks

This week the wheat will be sorted from the chaff in the Democratic and Republican party presidential nomination races, as voters head to the polls in two crucial early states -- Iowa and New Hampshire -- on January 3 and 8, respectively.  While neither state will definitively anoint the major party presidential nominees, they will substantially narrow the field of viable contenders.

As the first US state to assess the candidates, Iowa has traditionally been a key gauge of campaign momentum. Both party races in the 'Hawkeye State' are seen as exceptionally close. However, due to the idiosyncratic nature of the caucus system, typically small turnout relative to the total size of the state electorate, and the unprecedented early vote (which led pollsters to call voters over the Christmas-New Year holiday period) the accuracy of opinion surveys is highly questionable:

• On the Democratic side, the latest Reuters/C-SPAN/Zogby poll showed Senator Hillary Clinton (backed by 28% of likely caucus-goers) in a statistical tie with Senator Barack Obama (28%) and former Senator John Edwards (26%).

• For the Republicans, former Arkansas Governor Mike Huckabee (28%) and former Massachusetts Governor Mitt Romney (26%) are locked in a similarly tight battle; Senator John McCain and former Senator Fred Thompson (both on 12%) are vying for third place.

The candidate that finishes third in the Democratic race will be badly wounded heading into the crucial New Hampshire primary five days later. Among the Republicans, a win for either Romney or Huckabee would be a major boost, although the latter candidate still faces major organisational weaknesses beyond Iowa. A strong third-place finish by McCain could resuscitate his once-fading hopes.

When public attention shifts to New Hampshire following the Iowa result, four trends are likely to emerge:

• Former New York Mayor Rudolph Giuliani’s decision to largely ignore or deemphasise the early voting small states, on the assumption that a solid victory in Florida’s January 29 victory would allow him to recapture lost momentum, will seem increasingly rash.

• Unless Huckabee scores a decisive victory in Iowa, his campaign is likely to lose momentum.

• Romney’s star will brighten again -- especially if he has exceeded expectations in Iowa -- as he defends his home turf.

Obama and Edwards are likely to get a better sense of how vulnerable Clinton is to an upset.  If the former beats her into second place in New Hampshire following a tight Iowa contest, the Clinton camp’s big financial donors will begin to waver.