Jay Reding.com

This one won’t be that hard to predict, at least on the Democratic side. Hillary Clinton is toast. She needs a miracle to defeat Obama, and the ham-handed way she’s tried to come back have failed. Even though she’s right—even her paltry experience is infinitely more than Obama’s platitudes—the Democrats have embraced Obama’s gauzy rhetoric. Politically, it’s not a bad move. In terms of who can provide the Democrats with real leadership, Obama is a terrible candidate. However, he happens to have the right message at the right time, and that’s enough to win.

On the Republican side, I wouldn’t count Romney out quite yet. He did well in the debates, and McCain’s overtly combative side that we saw this weekend does not suit him well. The independent voters in New Hampshire will likely join the Obama juggernaut, which gives McCain less of an advantage. That being said, I think McCain will win. If McCain wins New Hampshire and Michigan, I don’t see how Romney can continue. Which is too bad, since I’m warming to him the more I hear.

Those two matchups are all that matter in this race. The rest of the candidates aren’t in the game in New Hampshire. Rudy and Fred are not campaigning there. (And Ron Paul isn’t going to get the nomination, even if he will pull some support in New Hampshire.) Edwards is a dead man walking, politically. He didn’t even pull the same support in Iowa he did in 2004. Huckabee will get some play in New Hampshire, but his brand of evangelical identity politics does not play well at all there.

For the Democrats, I don’t see any way that anyone can stop Obama now. It’s possible he could slip up, but the Clinton campaign has come off the rails in a way that I wouldn’t have expected. She’s never had to run a truly competitive race in her life (and neither has Obama), and she doesn’t know what to do. My guess is that Clinton will not go quietly. What’s amazing is that even her well-crafted spin machine can’t save her now.

The Republican field is still wide open. Romney is sinking, but he’s not out. McCain’s star is rising. Huckabee is still in the lead. Thompson is hanging on and betting the farm on a solid performance in South Carolina. Rudy could always come up from behind and surprise everyone if his strategy actually works. At this point a brokered convention isn’t out of the picture. There’s no real momentum yet for one candidate.

The big question is who goes out first. Right now, Romney looks like he’s going to lose steam before the others. If that happens, who gets his support? That’s why this race is so undecided—in a race divided by a few percentage points between the candidates a gain by one can propel someone ahead of the others. If Romney’s support goes to Thompson, Thompson ends up being in a vastly better position. If it goes to Huckabee, he’d be nearly impossible to beat. If it goes to McCain, McCain would have a strong chance of winning. If it gets split, then we’re still in a morass.

New Hampshire is proving to be somewhat anti-climactic, but that could change in the event that Hillary or Mitt stage a comeback. However, it’s looking like the Democratic race is becoming more firmly established just as the Republican one continues to be unsettled.

While I have no idea what the outcome of Iowa will be (and I doubt anyone else does either), I’ll venture a few predictions for tomorrow’s matchup in Iowa:

On the Republican side, Huckabee peaked too early. The attention he got caused people to take a look at his record, and it’s not good. Huckabee sailed in on homespun congeniality, but the more people look, the less substance he has, and where has has substantive positions they usually rub the Republican base the wrong way. I would cautiously predict that Huckabee will do worse than expected—mainly because he has nowhere to go but down. His support is soft, and he doesn’t seem to be moving in the right direction to take a convincing win.

It’s safe to predict a Romney win, since he’s poured so much into Iowa. However, to be viable, he has to pull off a convincing win. If Huckabee is sliding, that benefits Romney.

There’s not one, but two dark horses in Iowa. McCain and Thompson are fighting for third place, and both have been doing better than expected. Thompson needs a strong third-place finish in Iowa to remain viable. McCain hasn’t campaigned in Iowa, but does have a base of support there. Zogby is showing a late breakout towards Thompson. If Fred can get 15%+ that keeps him alive until South Carolina. If McCain does well (double digits) that keeps him alive until New Hampshire, where he has a chance at the top. It all depends on where those last undecided voters go—if Thompson were to pick up a lion’s share of undecided voters (which seems possible), that could give him the finish they need. If they go to McCain, that puts McCain a real edge given that New Hampshire will give him a boost as well.

The real story of the Republican side of Iowa is not who wins, but who gets out alive. I’m guessing that we’ll lose Rep. Hunter by the end of the week, since he has no traction nor any chance of gaining it.

Rudy’s out of Iowa—last year he was the front-runner, now he’s running a dangerous game that could easily put him out of the race before he really gets started. He won’t break single digits in Iowa, but what he needs is for Iowa and New Hampshire to be won by different people so that no front-runner emerges. If Romney wins both, Giuliani may be in trouble.

On the Democratic side, Clinton, Edwards, and Obama are all in play. I doubt Edwards will win, although he’ll come in a strong third. His brand of economic populism plays well with the Democratic base, but he’s not electable, and he’s been running for office longer than gaining experience. He couldn’t win his old Senate seat back, and he and Kerry lost ground against Bush. Kerry was smart enough to realize that he was damaged goods—Edwards is too vain to notice.

The Obama-Clinton race will be the one to watch. Obama’s run a campaign much like Howard Dean’s, except smarter. He also has the same problem that Dean has—his base of support is with people who don’t tend to vote. Still, I wouldn’t count him out. My sense is that he could very well win in Iowa, which would put Mrs. Inevitable in a very tight spot. Obama’s playing a dangerous game, however. The Clinton smear machine has him in their sights, and while their first shots were weak, sooner or later they’ll take him down.

If Clinton wins, it puts Obama in a tight spot. He has to perform, and he needs national momentum to do that. A Clinton victory puts the spotlight on her, and without an upset, Obama’s strength in Iowa will be put a roadblock to her path to the nomination.

If I had to guess, I’d say the former frontrunners will be the future frontrunners: which means narrow wins for Clinton and Romney. Huckabee leaves Iowa intact, but the pressure on him won’t go away, and he’ll do poorly in New Hampshire. Thompson needs a strong third place finish in Iowa and a win (or near win) in South Carolina to stay alive—which means that Thompson will need to campaign hard in South Carolina to keep Huckabee down.

Of course, all these predictions are going by the polls. The polls, as in 2004, could be entirely wrong. Thompson’s Iowa barnstorm could turn him into the John Kerry of the GOP, the single-digit candidate who suddenly became the frontrunner. Huckabee could collapse as Dean did, and for some of the same reasons. Clinton could sink and Obama could soar. Edwards’ populism could propel him to the top. McCain could surge in Iowa and then take down Romney in New Hampshire, putting him ahead.

Part of the fun of Iowa is watching expectations crash and burn, and there could be a lot of political wreckage strewn from Council Bluffs to Dubuque after tomorrow night.

UPDATE: Bob Novak predicts Hillary will come in third in Iowa. That would be a real blow to her campaign. However, I think the “Dean factor” is at play here—a candidate that excites younger voters doesn’t do so well in caucuses which are dominated by older voters who are deeply entrenched into politics. Then again, a narrow Clinton win doesn’t help her much, as it leaves two viable competitors who could present further challenges down the road.

As is my yearly tradition, I offer a few predictions for the new year, to be revisited (and frequently mocked) a year later. So, without further ado, this year’s predictions:

Politics/National

• Hillary Clinton defeats Obama for the Democratic Nomination. She picks Mark Warner as her running mate.
• She then narrowly loses to the Republican candidate (who is not Mike Huckabee).
• Sensing a weak field, Michael Bloomberg runs for the Presidency on a third-party ticket, picking CNN anchor Lou Dobbs Chuck Hagel as his running mate. He barely registers in the polls, despite pouring millions of his own money into the race.
• The Democrats retain control of Congress, but not be margins large enough to threaten vetos. Pelosi and Reid remain in control of their respective chambers, but end up being just as ineffectual as they have been over the last major year. Congress still does almost nothing throughout the year, and this Congress leaves with no major legislative achievements to its name.

International

• Violence in Iraq remains sporadic, as US forces slowly withdraw. Iraq becomes less and less of a domestic political issue. Al-Qaeda attempts a Tet Offensive, but it is quickly crushed thanks to solid intelligence provided by Iraqi civilians.
• The center-right remains triumphant as Nicolas Sarkozy, Angela Merkel, Kevin Rudd, and Stephen Harper all work towards free market reforms in their respective countries to great popular acclaim.
• The situation in Pakistan remains deeply unsettled, with Musharraf having only a tenuous hold on power.
• Iran continues to rattle sabers, and continues to enrich uranium, while the Bush Administration tries to ratchet up diplomatic pressure—to no avail.
• The Annapolis Peace Conference accomplishes nothing as once again Israel offers concessions and the Palestinians end up being too divided to offer anything in return.
• China improves its image with the Beijing Olympics.

Economics

• While the media continues to paint their picture of economic despair, the real story continues to be the “Goldilocks economy” of low unemployment, high economic growth, and steady wage growth.
• The sub-prime mortgage issue fades as the impact becomes more fully known. As the uncertainty fades, it becomes clear that the fears of recession were baseless.
• Oil prices stabilize around $100/barrel.

Society/Culture/Technology

• At MacWorld, Apple announces iTunes movie rentals - in HD, with a new Apple TV to match. They also announce an enhanced iPhone, an ultraportable MacBook with a flash-based hard drive and long battery life. Apple stock continues to climb.
• However, Amazon’s DRM-free MP3 download store starts stealing some marketshare from iTunes. More studios embrace selling their music unencumbered by DRM, leading iTunes to abandon their FairPlay DRM on music by the end of the year.
• Despite blockbusters like Indiana Jones and the Kingdom of the Crystal Skull and Star Trek, box office receipts decline both in number of tickets and dollars grossed as the price of high-def movie equipment declines. While movie ticket sales decline, sales of HDTVs, home theater setups, and HD-DVD and Blu-Ray players soar. HD-DVD players hit the $100 mark by the end of the year, meaning that HD-DVD adoption pulls away from Blu-Ray.

We’ll see how well these predictions turn out next year…

UPDATE 12/31/07: One minor change. Despite both being cranks, Bloomberg and Dobbs apparently don’t agree on much. However, Bloomberg and Sen. Chuck Hagel have met before, making them more likely political bedfellows.

YET ANOTHER UPDATE: One more prediction: No Country for Old Men will win Best Picture at the Oscars. It deserves to. If you’ve not yet seen it, it’s an amazing movie because of the way it’s almost entirely built on subtext. But don’t let that dissuade you: it’s not preachy, it’s not pretentious, and it isn’t an “art house” movie. It’s just a damned good film.

As always, every year I make a set of predictions for the upcoming year. And every year I see how accurate I was. Last year’s predictions were a little off-the-mark. And by a little, I mean a lot. Let’s see how we did:

Iran will announce that they have completed work on a nuclear weapon and will conduct nuclear tests, showing once again how the intelligence community got it wrong.

Fortunately, not yet. I do think that the NIE is wrong, and that Iran is gathering the materials needed to make a bomb. I would be willing to bet that they’re farther along than we think. The hardest part is getting the fissile material, and the Iranians have thousands of centrifuges that can enrich uranium to weapons grade.

However, Ahmadinejad will face great political backlash as the Iranian economy begins to collapse.

Close, but no cigar. Iran’s economy is being propped up by high oil prices, and there’s some internal backlash against Ahmadinejad, but not nearly enough to put him into political jeopardy.

Iran and the US will enter a state of de facto war as Iranian naval vessels blockade the Straights of Hormuz and more Iranian fighters stream into Iraq.

Ugh, Straits of Hormuz…

Thankfully, it didn’t happen. It still could, but the Iranians seem less confrontational now.

President Bush will announce significant troop withdrawals from Iraq, as the situation in Iraq grows even more dire. His attempt to “surge” troops into Baghdad will be too little, too late, and not long enough to make a difference.

This one was totally wrong—and I’m glad to say that it was. The “surge” has certainly worked, and that’s largely because Gen. Petraeus was smart enough to make it less about having more troops and more about taking the strategies that Col. H.R. McMaster applied in Tal Afar and using them throughout Iraq. He really should have been Man of the Year, because he’s changed the history of the region in ways that will have profound repercussions for years. Gen. Petraeus is our T.H. Lawrence, except he had even more success.

The al-Maliki government will collapse when SCIRI and the Sadrists both walk out.

Dead wrong. Iraq’s coalition government is ever fractious, but it has managed to stay together.

The biggest success in the War on Terror will be when Ethopian troops take down the Islamist government in Somalia in a decisive victory.

That did happen, although the surge in Iraq rightly is the biggest victory in the war.

As a consequence of the above, the US will begin training Kurdish peshmerga to fight al-Qaeda as US troops withdraw.

It’s interesting to see the changing dynamic in northern Iraq. The Turks are striking at Kurdish terrorist groups, with our support. The Kurds don’t seem to be overreacting, much to their credit. Part of it is probably due to the fact that they’re sick of war, part of it due to the fact that Turkish companies are crucial to rebuilding Iraqi Kurdistan. Still, the Iraqi Army is doing a good enough job, and instead of Kurdish peshmerga it’s native Sunni groups who are kicking al-Qaeda out of Iraq.

Apple will release a cell phone that runs a stripped-down version of Mac OS X, creating the hottest gadget since the iPod.

Ah, the iPhone. Not perfect, but still the best cellphone ever made. Even though us early adopters got chumped. I wouldn’t trade my iPhone for a solid platinum RAZR. Mobile Safari may be a bit crash prone, and the software is still not quite up to Apple quality, the concept is so far ahead of its time that it’s still a work of technological art.

President Bush’s approval ratings will stay low, but not lower than they are now. (Which granted, isn’t saying much at this point.)

Pretty much true.

The Democratic Congress will push through a substantial tax raise, and the Bush Administration will capitulate. The stock markets will plunge in response.

President Bush has found his veto pen and apparently his cojones. If only G.W. had been this fiscally conservative when the GOP was in power…

Hizballah will continue their reign of terror in Lebanon, as Syrian forces take control of the country once again.

This hasn’t happened yet, but as Emilie Lahoud has stepped down, Syria continues to try to exert control over their neighbor. When even the French have said that enough is enough, it’s clear that Assad is not willing to cooperate. Sadly, Lebanon’s problems aren’t going away, and may yet get worse.

More critics of Vladimir Putin will find themselves dead.

Putin is still a tyrant, but he’s been more careful than in the past. Perhaps the horrendous death of Alexander Litvinenko was enough to dissuade others. The arrest of Garry Kasperov, however, demonstrates that being a Putin critic is a dangerous business in today’s authoritarian Russia.

Socialist Ségolène Royal will defeat Nicolas Sarkozy in the French elections.

Again, dead wrong. Nicolas Sarkozy could yet be the Thatcherite figure that France needs.

Barack Obama will continue to flirt with running for the Presidency throughout 2007, just to keep Hillary guessing.

Instead, he plunged into the race and is now making Hillary sweat.

John McCain will emerge as the front-runner in the 2008 GOP race while Rudy continues to keep everyone guessing as to what his intentions really are.

Rudy became the frontrunner, McCain nearly sank his campaign pretending to be one, and now the GOP race is up in the air.

All in all, a mixed bag. The biggest thing I got wrong was the “surge”, which isn’t surprising because last year I figured that it was about numbers rather than strategy. 2007 became a turning point in the war, one in which the US and the free people of Iraq have gained a decisive advantage over the enemy. Things in Iraq could still go bad very quickly, but in terms of predicting the outcome of the surge, I was dead wrong. As I was about Iran, Lebanon (to a point), and the French elections. My predictions for 2007 were a bit on the pessimistic side—fortunately, things didn’t turn out nearly as bad as they could have.

Coming up soon, my predictions for 2008.