Our Monthly Update on the Democrats’ Nomination Battle: A Change at the Top

Insights and Market Perspectives

Author: Greg Valliere

September 25, 2019

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WHILE WAITING for more theatrics today in an impeachment brawl that will NOT oust Donald Trump, let’s focus on the other big political story — a dramatic change on the 2020 leader board as the Democrats’ top three contenders change positions.

OUR MID-MONTH UPDATE is a little late, because this city is gripped with impeachment fever, as we wrote on Monday. As of now, we think chances of a House indictment are about 40%, while chances of a Senate trial and conviction are 20% at best. Perhaps most significantly, this stunning new development has given Donald Trump a foil to exploit, and he will furiously denounce a “witch hunt.” This actually could help him — which is why Nancy Pelosi doesn’t want to impeach.

Meanwhile, here’s our latest take on the Democrats’ pack:

10. Long-shot late entrants: If Joe Biden continues to stumble and Elizabeth Warren appears to be too polarizing, we think there will be speculation about a late entry by one of four long-shots: Michael Bloomberg, who already has said no; John Kerry, who was the nominee in 2004; Hillary Clinton, who’s still radioactive; and the most intriguing long-shot of all — Michelle Obama, who swears she won’t run but could unify the party and mount a serious challenge to Trump.

9. Tom Steyer: He has bought his way into the next debate, on Oct. 15-16, and undoubtedly will play the role of pit bull, demanding Trump’s ouster. He’s deeply unpopular within the party’s establishment, but Steyer could move the needle a bit among die-hard Trump opponents.

8. Julian Castro, John Yang and Beto O’Rourke: They imploded in the last debate. Castro threw a cheap shot at Biden, Yang unveiled a tacky plan to give voters money, and O’Rourke gave Republicans a sound bite for years to come when he pledged to take their guns. These three are going nowhere.

7. Kamala Harris: One of the big disappointments in the pack, she stalled out after challenging Biden early. Harris will virtually live in Iowa and could gain some altitude, but her most realistic hope is to win the California primary on March 3.

6. Cory Booker: He’s an impressive speaker who has won admirers, but Booker still can’t break above 5% and he has money woes. A potential vice presidential pick.

5. Amy Klobuchar: She has carved out a spot in the top five by appealing to moderates as the adult in the room. Klobuchar will take votes away from Biden in Iowa, and she remains a potential VP pick.

4. Pete Buttigieg: He’s still alive. Mayor Pete’s polling numbers have ticked up a bit, reflecting a growing view among Democrats that he’s the most articulate and interesting candidate in the field.

3. Bernie Sanders: His campaign is in disarray, plagued by infighting, and his last debate performance was disturbingly angry. Sanders probably will hang on into the spring, but once it’s clear that he won’t be the nominee, the crucial event of the entire the campaign will be the timing and terms of his release of delegates to Elizabeth Warren.

2. Joe Biden: He hasn’t quieted the whispering that he’s lost a step or two. Republicans won’t let go of their narrative that Joe and Hunter Biden are concealing something. And suddenly the former vice president no longer leads in Iowa. His supporters think Biden will passionately fight the Ukraine allegations, and they say even if he finishes second in Iowa and New Hampshire, he could right the ship in the Feb 29 South Carolina primary. But Biden has been steadily sliding for the past month, and his campaign is in trouble.

1. Elizabeth Warren: Quite simply, she’s surging. As we have warned for months, she wants to aggressively tax and regulate the the financial services industry, which has to watch her carefully. Warren is ahead in Iowa and New Hampshire; she has the best campaign operation in the field, and now controls the left lane.

Warren soon will become a target — the hunter becomes the hunted — but she can handle the pressure. It’s difficult to see what will throw her off balance, and for now Warren is the favorite to win the nomination. Her detractors have one main argument: can she beat Trump? We may get to find out.