Is Covid 19 an election issue? What is Vegas saying about Trump?

Is a Government’s handling of Covid 19 an election issue?

Several elections have been run during the pandemic.  In most cases, the governing party has sought to portray their handling of the Covid 19 problem as testimony to their credentials.  Singapore’s ruling PAP, for instance, made the Covid 19 issue central to their credibility.  New Zealand is on its way to the polls in September with their Prime Minister’s popularity having been bolstered by the apparent success is eliminating the virus from their fair shores.  The US election happens shortly after.

The election result in Singapore surprised many with a 10% swing away from the Government.  The obligatory post mortem found disenchantment amongst young voters on many issues but the Covid 19 response was virtually absent from any blame.  This suggests that Covid 19 is not an election issue in the minds of voters.  This stands to reason, actually, since the Covid 19 event is purely external to any Government policy choice that had been made prior to it appearing.  There are many ways to deal with the emergency – lock down, test extensively, sponsor research etc etc – and voters expect their Government to act responsibly but it may be that this cannot be exploited by the ruling party as an election issue.  The fact is that the same or similar reaction would have taken place regardless of who is in power at the unfortunate time of the pandemic.

That voters neither apportion credit nor blame on the particular Government in power for how they deal with Covid 19 should be a wake up call for New Zealand Prime Minister Jacinda Ardern and the Presidential twins Joe Biden and Donald Trump.  Ardern could suffer an embarassing swing against her and be ousted from office while Biden cannot paint a general picture of Trump’s incompetence based on Covid 19 – after all, the virus is not Trump’s fault.  Blaming China, on the other hand, may well resonate with the US electorate…

What is Vegas saying about the US Presidential election?

As of today, the Presidential betting favours Biden over Trump.  Biden’s odds of winning are odds-on 8/11 while Trump is 7/5 against (data courtesy of oddschecker.com). Those of you astute enough to analyse the implied probabilities from these quotes will notice that there is something wrong with this market.  Biden’s probability of winning is 0.579 while Trump’s is 0. 417, which if you add the probabilities together comes to 0.996.  The problem is that no self-respecting bookmaker would quote a market that is unfavourable to themselves. The mathematics of bookmaking defines a ‘fair book’ as when the probabilities sum to one whereas bookmakers try to ‘overround’ to make a profit which happens when the probabilities sum to more than one.

My suspicion is that a punter would find it hard to take Trump at 7/5.  You may recall that the day before the 2016 election, Trump was offered at 5/1 while Clinton was 1/11 (the overround on this market being 1.083 or an 8.3% commission for the bookies). In fact, the brainstrusts at the UK bookmaker Paddy Power had paid out the Clinton backers a week early only to have to pay the Trump backers as well upon his upset win.

Vegas won’t write Trump off just yet.

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