Forecasting Elections

By Rajiv Sethi, Professor of Economics, Barnard College, Columbia University. Cross posted from his blog.

his wild and crazy election cycle is generating an enormous amount of data that social scientists will be pondering for years to come. We are learning about the beliefs, preferences, and loyalties of the American electorate, and possibly witnessing a political realignment of historic proportions. Several prominent Republicans have vowed not to support their nominee if it it happens to be Trump, while a recent candidate for the Democratic nomination has declared a preference for Trump over his own party’s likely nominee. Crossover voting will be rampant come November, but the flows will be in both directions and the outcome remains quite uncertain.

Among the issues that the emerging data will be called upon to address is the accuracy of prediction markets relative to more conventional poll and model based forecasts. Historically such markets have performed well, but they have also been subject to attempted manipulation, and this particular election cycle hasn’t really followed historical norms in any case.

On Super Tuesday, the markets predicted that Trump would prevail in ten of the eleven states in play, with the only exception being a Cruz victory in his home state of Texas. This turned out to be quite poorly calibrated, in the sense that all errors were in a single direction: the misses were Oklahoma and Alaska (which went to Cruz) and Minnesota (where Rubio secured his first victory). But the forecasters at FiveThirtyEight also missed Oklahoma and were silent on the other two so no easy comparison is possible.

Today we have primaries in a few more states, and another opportunity for a comparison. I’ll focus on the Republican side, where voting will occur in Kansas, Kentucky, Louisiana and Maine. Markets are currently predicting a Cruz victory in Kansas (though the odds are not overwhelming):

rajiv 1

In contrast, FiveThirtyEight gives the edge to Trump, though again it’s a close call:

rajiv 2

The only other state for which we have predictions from both sources is Louisiana, but here there is negligible disagreement, with Trump heavily favored to win. Trump is also favored by markets to take Kentucky and Maine, for which we have limited polling data and no predictions from FiveThirtyEight.

So one thing to keep an eye out for is whether Trump wins fewer than three of the four states. If so, the pattern of inflated odds on Super Tuesday will have repeated itself, and one might be witnessing a systematically biased market that has not yet been corrected by new entrants attracted by the profit opportunity.

But if the market turns out to be well-calibrated, then it’s hard to see how Rubio could possibly secure the nomination. Here’s the Florida forecast as of now:

rajiv 3

The odds of a Trump victory in Michigan are even higher, while Kasich is slightly favored in Ohio. Plenty of things can change over the next couple of weeks, but based on the current snapshot I suspect that there is a non-negligible probability that Rubio may exit the race before Florida to avoid humiliation there, while Cruz and Kasich survive to the convention. This is obviously not the conventional wisdom in the media, where Rubio continues to be perceived as the establishment favorite. But unless things change in a hurry, I just don’t see how this narrative can be sustained.

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  1. jgordon

    Rajiv mentions that many voters from both side will be crossing the isle to vote for the candidate of the opposite party. I thought that must be very significant when I read that: people who are fed up with the system will be voting for the protest candidate of either party, while those who are benefiting from the establishment prefer to vote in their perceived interests by voting for the corrupt establishment candidate.

    I just finished reading a truly fascinating article by The Guardian where they interviewed a bunch of Trump supporters to find out what was going with them: There are a lot of times where Democrats like Sanders, but like Trump too (or at least hate him less than Hillary and will vote for him) and vice versa. Pretty interesting that there are actually Republican Trump supporters who would vote for Sanders the Socialist if they had the chance as well, but there it is.

    For me, this is the most intriguing thing going on with this election. I know the establishment media is probably not interested in exploring this topic further, but hopefully someone will.

    1. PlutoniumKun

      Its an interesting phenomenon, but its not exactly new, and not just in the US. In the 1980’s we had the ‘Reagan Democrats’. In France, much of Marine Le Pens support comes from areas with a traditional radical left wing vote. Here where I am in Ireland, where we have a transferable vote system, its often very interesting to see how people vote when given a ‘1,2,3…’ option – it isn’t always what you might think – there are often surprising numbers of transfers switching from left to right, with peoples preferences obviously going for individuals rather than political stances.

      I think that in most countries, there is a large vote of what might be called ‘disgruntled, nationalist, working class/lower middle class people’. Commentators – both professional and amateur – tend to assume that most people are like them – well aware of the distinctions between left and right, libertarian and authoritarian, and identify on one those spectrums. But in reality, many people – and not just ‘low information voters’, have a complex mix of beliefs which don’t fit into neat categories, and can in fact be superficially contradictory. They dislike ‘the man’ (either government or big business), are reflexively nationalistic and pro their military, while distrustful of those who control the military, are personally generous and open, but recoil from outsiders, care about their local environments, but are suspicious of ideological environmentalists, and so on.

      In times of stress, these people are more likely to swing to an extreme – but it can be entirely random as to which extreme they swing to. It might be simply that they are attracted to a charismatic leader, or just stick with a local tradition of militancy, either left or right. If you are brought up in Glasgow in Scotland, if you are catholic that reflex is to move to the left, if you are protestant, that reflex is to move to the right.

      I think this is all the more reason than any sensible person anywhere in the planet must pray to their Gods that Sanders wins. It only will take a few butterfly wing flaps for a huge movement to build behind Trump – and then we are in the hands of a fairly unintelligent narcissist as to which direction the US might take (I’m not convinced that he is an extremist or fascist, but I do think it wouldn’t take much to move him in that direction). But a Sanders win could be absolutely pivotal for progressive movements all over the world. Its impossible to exaggerate just how much of a boost that would give to genuine reformers from Europe to South America, from Africa to Asia.

      1. divadab

        @plutonium – excellent analysis. I share your hopes regarding Mr. Sanders but I think Pres Trump is a distinct possibility. Pres Clinton would be a step backwards into neocon all regime change all the time ideology. I really wonder if Pres Clinton is worse than Pres Trump – at least as far as foreign policy is concerned.

      2. Jim A.

        Certainly the big, energizing thing that Ronald Reagan did was to unite social conservatives and and the anti-tax wing of the republican party under the “less government” banner. This solidified Nixon’s “Southern Strategy.” Once he had framed those as two sides of the same coin, he could call both constituencies to feed by saying that the (Federal) goverment WAS the problem. Perviously, the parties were divided largely along economic grounds rather than social ones. This was very successful, and the Republican party has been beating the anti-government drum ever since.

  2. Jim

    The fundamental realignment that is necessary for this country involves a gradual coming together of the constituencies of the Sanders and the Trump camp.

    Trump can continue to educate the American public on the realities of how power actually works in our society. But if a new populists politics is to fully emerge Trump must have the courage to continue to directly threaten multinational corporate and financial interests and solidify himself as the champion of the increasingly decimated American working class and an increasingly desperate middle class.

    It is now time for Sanders to put aside his own political correctness and go after Hillary tooth and nail and promise never to back her in the general election. The Sanders campaign should also begin propose a new political state structure for the country ( a radically decentralized and potentially genuine democratic federalism run on principles of subsidiarity) that could become the vehicle through which a newly mobilized working and middle class could begin to exercise real community and regional power.

    A democratic federal populism consistent with our historical traditions might then emerge.

    Of course the most likely outcome in the immediate future is that the emerging populist right and emerging populist left will continue to call each other fascist–each content in their own self-righteousness and orthodox political thinking.

    1. cwaltz

      Trump can continue to educate the American public on the realities of how power actually works in our society.

      I’m pretty sure EVERYONE is already aware of how power(or should we say money) woks in our society. No one needs an education at this point. We’ve had plenty of demonstrations.

      But if a new populists politics is to fully emerge Trump must have the courage to continue to directly threaten multinational corporate and financial interests and solidify himself as the champion of the increasingly decimated American working class and an increasingly desperate middle class.

      This statement made me LOL. The guy who essentially IS mostly rich by way of his branding and has had a history of mistreating workers both here and overseas is going to become a champion of a decimated working class?

      That kinda sounds delusional and certainly not founded in any fact based history.

      If you want to make him your champion o protest vote great. However, don’t kid yourself with these fantasies that the guy who said THIS about minimum wage

      “Taxes too high, wages too high, we’re not going to be able to compete against the world,” Trump said. “I hate to say it, but we have to leave [the minimum wage] the way it is.”

      Or the guy who did this to workers because he could-

      or is presently doing this-

      It’s just not honest to suggest Trump is somehow pro worker. He’s not. He wasn’t when he built Trump tower and he isn’t today to the workers working for his own company. So just stop it already.

      1. Jim

        Your ideological orthodoxy is breathtaking.

        It is apparently inconceivable in your own mind that a billionaire is capable of arousing the most profound class issues.

        You should be worrying that the Donald will want to or be forced to make a deal
        with the corporate elite and that your responsibility is to make sure that he makes a deal with the Sanders populist left.

        Of course this would also mean that the orthodox left thinking, of the comment by ambit below, would have to be transcended and realigned.

        If history has proven anything it is that vanguard of the proletarian thinking and its inevitable centralization of power is a catastrophe and that the challenge for a future populist left/right coalition is to create a genuine democratic political structure through which it can exercise power.

        Think Paul Craig Roberts/ Michael Hudson/Thomas Jefferson.

        1. cwaltz

          Look at his RECORD.

          The guy has said that in order to compete US workers are going to have to deal with a wage that already isn’t sufficient. He cheated the people who built his building years ago and he’s PRESENTLY union busting.

          It doesn’t matter if he’s capable of arousing class issues. Is he capable of addressing them? Based on his behavior and statements the answer is a resounding NO.

          I’m not worried about Donald nor do I think the populist left should make a deal with them(anymore than I think they should make a deal with Hillary Clinton simply because she tweets something that SOUNDS vaguely pro labor.)

          If you want to do so. Knock yourself out. However, don’t bother pretending that Donald Trump is going to be some great boon for the American worker. He’s not. He’s probably already “made a deal” with the corporate elite. That’s why they aren’t wasting money fighting him.

          1. RUKidding

            I agree. There’s a lot of hoo-hah about Trump’s alleged populism and how he’s somehow going to “make it better” for the disaffected largely white hetero low-educated/information male voter. Good luck with that.

            Trump is known to hire undocumented workers – probably mostly from Mexico and Central America – and pay them pennies on the dollar. Trump is a well-documented union buster. He’s also known to use H1(b) visas to obtain guest workers mainly from Eastern Europe to work as indentured servants in his various business holdings. Trump allegedly has spoken against H1(b) visas, but then I saw recently that he recanted on that saying that “in some cases” H1(b) visas are needed.

            We can all agree that a lot of Trump’s base have some totally genuine complaints, and their anger is understandable. What THEY, Trump’s loyal fans, aren’t getting is that Trump is no savior for THEM. Trump will trounce all over them, should he win the election, and spit on them in a heartbeat giving them the same old same old treatment they’ve been getting from the GOP/oligarchs for the past 30+ years.

            When I hear stooges (and I see them as stooges) on the radio waxing lyrical about how Trump is this vast great “outsider” savior who’ll save us from the parasites and predators… I just wanna pound my head into the wall bc it will feel better than listening to these brain-dead idiocies pouring out of the pie holes of my fellow ‘Murkins.

            Wake up sheeples….

            1. jgordon

              I don’t think you understand what’s going on with Trump, so it must be pretty confusing to you why so many “dumb” Americans are supporting him against their interests.

              Well that’s not. People support Trump for two reasons primarily: 1st everyone hates him. You hate him. Politically correct police hate him. The establishment hates him–basically everyone Trumps supporters despise hate Trump. Therefore there must be something good to him. That’s number one. Don’t underestimate that motivation. It’s extremely intoxicating and powerful. People are going to vote for Trump just to see the look on your face when he wins. I’m not kidding. Thinking about getting to see Mitt Romney and Hillary Clinton cry after he’s elected even makes me shiver a bit.

              Number two is that Trump promises to bring down the corrupt system. And you don’t bring down the system by being stately and competent. You accomplish that by being brutish, incompetent, and nuts. There is a very large fraction of Trump supporters, myself included, who like Trump because he has good odds of burning everything down to the ground. And better yet, with regards to foreign policy he’s quite benevolent and tolerate compared to any of the other candidates and so he is least likely to start a nuclear war while he’s going about his domestic project.

              I mean seriously–why do you think Trump’s ratings go up every time he says something insane, insulting, or hypocritical? That is what Trump’s supporters want from him. And I guarantee you that all this opposition research you think will be effective is only going to enhance his image in their eyes. Trump is not a normal candidate. He’s something different and alien to American politics.

      2. Beans

        The presidential candidate Trump is quite different from the businessman Trump who you quote. Despite his history, Jim is correct that his voters see him as the anti-corporate, pro-worker crusader they need. Willful blindness or PR induced ignorance does not matter – Trump has successfully convinced millions that he is their man. Trump has adopted many of Sanders long held positions but has also not gotten too deep into social or environmental issues that would scare working class GOP voters away.
        If Sanders recreated himself ala Trump – whitewash out his “socialist” positions that are objectionable to more traditional (older and more Southern) voters like Trump has whitewashed out his past business positions that would be a problem for the working class GOP voters, Sanders would have been in a much better political position.
        Sanders is either a truly remarkable politician – one who would give up victory to remain (mostly) pure to his ideals; or he is a guy who wants to influence the debate but not win the office.
        Regardless, the demographic exists to elect politicians who blend both populism and progressivism. That will not go unnoticed and will certainly shape elections for years to come.

      3. Lexington

        You see this argument a lot on the left, but it completely misses the point. Whether Trump is a genuine populist or whether he only plays one on TV doesn’t fundamentally matter to people who desperately want to believe he is the real deal and who in any case can see no better alternative.

        Tearing down Trump and mocking his supporters is Exhibit #1 in why Jim’s bold proposal for a broad coalition to challenge the status quo is stone cold DOA.

    2. ambrit

      Somehow, I view this line of argument as a stealth ‘States Rights’ platform. One of the great strengths of the centralized Federal governing strategy is it’s supersession of the fragmented country method. America fought a major civil war over this exact point. For good or ill, the Federal Government sets the agenda for the country now. What’s really important is who controls the reins of power at the national level. All any serious devolution of authority in America will produce is a formal series of Mini Americas. This might be ‘fun’ out West or up North, but here in the Deep South, all it will produce is institutionalized misery. One thing the Blacks down here are right about is that racism is still alive and kicking. Their only real friends, politically speaking, are at the Federal level. Remember how much Washington had to intervene to support Civil Rights? Without those interventions, the South would still be groaning under the impositions of Jim Crow laws.
      It might sound utopian but, what America needs more than a “democratic Federal populism” is a ‘Vanguard of the Proletariat.’

      1. divadab

        Time to write off the SOuth. Let em. They’re backwards. Too bad for the slave descendants but again how can it be worse?

        1. ambrit

          Lest we forget, as has been demonstrated here, the Northern Capitalists of the time colluded with and profited off of the Southern Plantation ‘Elites.’ Blaming the Sothrons alone for the sins of the fathers is disingenuous.
          Also, do note that the South is the template for the rest of America under the tender ministrations of the Neo-Liberal Dispensation.

      2. Gio Bruno

        Maybe what the US needs is a Parliamentarian form of governing. It would avoid the all or nothing system we have now. Giving smaller groups of people a voice (if not decision making) is essential to the steady growth of pockets of “opposition”.

        1. sd

          There’s always a weakness such as the tyranny of the smallest party in a coalition. It can give a minority the power to extract promises.

          That said, I do wish there was a way to hear more voices such as is possible in parliaments.

    3. Lexington

      The fundamental realignment that is necessary for this country involves a gradual coming together of the constituencies of the Sanders and the Trump camp.

      In many ways this makes perfect sense, but as a practical matter there are huge cultural barriers to effecting such an alliance. Many on the left have nothing but contempt for the social values of the working class, especially in regards to race relations, sexual identity and gender roles. It is worth remembering that working class whites were the Democrats’ core constituency from the New Deal era until the early 1970s, when they started abandoning the party in droves as it became more and more preoccupied with the (often competing) demands of New Politics constituencies like minorities, women and youth. Overcoming forty years of alienation would be a huge task even if progressives were sincerely committed to it, but for the most part they are not. In fact they generally regard working class values as indefensibly archaic and regressive, and fit only for the dustbin of history. Although they would be loath to admit it in many ways this also sums up their basic attitude toward the working class itself, whom they relentlessly assail as “low skill” Neanderthals who aren’t quite bright enough to realize that the world has passed them by and who would be doing everyone a favour by fading gracefully into the sunset and taking their appallingly decrepit values with them.

      Guess what, the working class isn’t stupid and knows when it is being condescended to. Also, they deeply, deeply resent it, and the resentment has been building for four decades.Chis Hedges had a great column earlier this week on where this is likely to lead. Spoiler alert: it isn’t with a Big Tent alliance of progressives and economic underclass storming the heights of entrenched privilege.

      1. Jim

        “…but as a practical matter there are huge cultural barriers to effecting such an alliance.”

        Lexington, that is probably the understatement of the day but time is a wasting (and the financial,economic, political, cultural squeeze is accelerating–so we might as well begin to face these cultural issues directly.

        Condescension and lack of trust is right at the top of the list.

        What are this origins of this type of condescension?

        Do participants in left orthodoxy actually believe they are superior?

        Is such condescension linked to a managerial philosophical perspective?

        1. Lexington

          Moral outrage feels good. It self affirms our superiority over others. It has a particular appeal in Western culture, where cultivating a healthy egocentricism is strongly encouraged and consequently narcissism is rampant. I once read an article by a OWS organizer who remarked that one of the things that paralyzed the movement is that substantive discussions about objectives and means were frequently hijacked and diverted into pointless bickering about who was a “real” supporter of the movement (identified by passing various arbitrary litmus tests based on the positions they advocated) and who was merely a poseur. To a certain extent the movement was sabotaged by the unwillingness of many participants to check their egos at the door and resist undermining the movement’s larger objectives in order to satisfy their own emotional and identity needs.

          Another way this plays out in the current political context is in the reaction to reports that white male working class mortality is rising significantly. Many commentators have unhesitatingly and without a shred of empirical evidence attributed this to the “withdrawal of male privilege” (the fact that most of these people are themselves highly privileged upper middle class members of academia and the mainstream media is generally unacknowledged, because they pretend not to recognize irony when it is at their own expense). The ideological point being defended here is that under no circumstances is it permissible to regard white men as victims, regardless of the circumstances. The colour of their skin and their gender preclude them from any claim to that status. Identity politics is the wedge that split the white working class from the Democratic party in the first place; that rift cannot be healed so long as it remains the dominant paradigm for organizing political mobilization.

          Is such condescension linked to a managerial philosophical perspective?

          It clearly has multiple sources, but managerialism is an important one. This relates to my previous comment about the working class being dismissed as “low skill”: in America the rhetoric of “skills” is used to justify all manner of capitalist inequity. If you’re economically marginalized, if you can’t afford health care, if your children can’t get a decent education, if retirement is out of reach because your underfunded defined contribution pension plan is tapped out, if social mobility is something you’ve heard about but never actually experienced, well, it’s all your own fault for lacking “skills”. You should have become a Wall Street stock promoter “analyst”, or a Fox News propagandist “journalist”, or an Arthur Andersen grifter “accountant / business consultant”, or a Fortune 500 spawn of Satan “CEO”. Those people took the trouble to acquire skills and are justifiably lionized and rewarded as paragons of capitalism. Suck it up, loser.

          I also think it’s important to recognize that arguably the most nefarious aspect of this ideology of skills is not its purely economic dimensions but the way it robs the working class of basic human dignity. Liberals perpetually profess confusion that working people often appear to vote against their own economic interest, but the confusion stems from the poverty of their analysis. By focusing exclusively on economics they miss the broader cultural context of working class alienation. If you want to reach out to the working class you should begin by acknowledging the hurt, anger, frustration and -last but by no means least- stark fear that comes from being on the losing end of a four decade long class war. Donald Trump’s unique genius is that he intuitively understands this. It is an indictment of the liberal intelligentsia that for the most part they do not – in fact as often as not they have been full collaborators in undermining the economic security of a large part of the population, and in creating the ideology to rationalize it.

      2. jrs

        “Many on the left have nothing but contempt for the social values of the working class, especially in regards to race relations, sexual identity and gender roles.”

        uh is it even a net positive to win working class white males if you thereby lose women and minorities?

        1. Lexington

          It’s interesting that you speak of “working class white males” and “women” as mutually opposed constituencies, while I spoke only of the “white working class” collectively. As it happens white working class females generally share the social attitudes of their male counterparts, but liberals find this a bitter pill to swallow because in their minds this makes them something akin to gender traitors. To resolve this cognitive dissonance they deny agency to working class women and conscript them into the broader category “women”, which is a subcategory of the general category “not white working class males”. Because in this world, the world of liberal social warriors, the only distinction that matters is between white working class males (a.k.a. Neanderthals) and everyone else.

          My point is that to build a broad coalition in favour of reform, a coalition that could unite both Sanders and Trump supporters, there is going to have to be a lot of give and take on both sides. Politics is truly the art of compromise. For many liberals this specifically means letting go of the “us vs. them” duality that your comment reflects and instead seeking common ground in a spirit of mutual respect and goodwill, with both sides acknowledging and accepting that there are going to be points of irreconcilable difference, but with both being committed to setting aside those points for the time being in order to concentrate on the areas in which their agendas broadly coincide.

          Being that we live in an age of hyperpolarized partisanship, the near universal assumption that people who hold opposing points of view are motivated by bad faith, and the dominance of identity politics that denies the possibility of common interests transcending racial, gender, or ideological barriers (see your comment above) I’m not at all optimistic that this is a realistic objective.

          Still, it’s a beautiful dream.

          1. Yves Smith Post author

            Yes, I’ve been put off by the “white/white working class males” focus too. It’s as if that recent study on the rise in death rates in 45-54 year old less educated whites made them a distinct class, when a study last year that got less attention (probably because the authors were less famous) found that death rates among rural women had risen alarmingly.

  3. flora

    “Among the issues that the emerging data will be called upon to address is the accuracy of prediction markets relative to more conventional poll and model based forecasts. ”

    Prediction markets can’t accurately calculate outside their ‘known normal range’. This year is outside the normal range.

    If there is a lot of cross-over voting in the general maybe we’ll get back to a business oriented R party that doesn’t think the govt belongs in your bedroom and doctor’s office; get back to a D party that defends the safety net and isn’t a Wall St. courtier.
    Such a change would wreck the current establishments in both parties.

  4. meeps

    Every day I grow more skeptical about the narratives I’m hearing–on all sides.

    At the moment, the runners-up for leader of our “famously free” world are assumed to be Trump and Hillary. You may disagree with that assumption on the face of it and that is fine. They are both exquisitely detailed reflections of the advanced state of decay in which we find the Earth and her inhabitants.

    Dead is dead. The sixth mass extinction is accelerating and is putting immense pressure (of all kinds) on populations. The brouhaha only serves to distract from this very disturbing fact. Any solution that might alleviate some suffering or deliver a modicum of dignity to any of us will not be found in what ANY of these people have on offer. Really think about that.

    Food. Air. Water. Shelter. Medicine. Someone to laugh or cry with. Human needs are quite basic. Take a breath and focus your resources constructively.

    It’s not my intention to minimize the very real concerns people are expressing. I conclude that it would be better for one to abstain from voting, however, if ones’ tendency is to be herded into supporting these totally illegitimate criminals and con artists. You don’t need to be a doctor to honor the hippocratic oath; first do no harm. You’ll do society a much greater service.

  5. ChrisFromGeorgia

    Is it just me or has the smug Nate Silver been taken down a notch or two this cycle?

    I recall his ESPN-linked site touting the “endorsement primary” (as if it mattered – whoops!) and predicting that Jeb! would be the nominee.

    This makes me recall one of Taleb’s books that made the point that the last stock market guru who called all the highflying winners would usually fail the following bull market as it was likely all due to randomness.

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