The markets are giving Michigan representative Justin Amash a 36% chance of running for president before June 1. If he runs, it would almost certainly be as a Libertarian. This market terrifies me. I’m staying out.
In a market like this, I think you have to assume that a number of traders have privileged information and will always have an edge on you—people in Amash’s orbit and Libertarian Party circles being the most obvious examples. So the question is whether there is any reason to believe, based on available information, that the market is mispriced.
I can think of three main reasons why Amash would not want to run:
1. National Debate Thresholds: In order for a 3rd party candidate to get into the national presidential debate, he/she needs to reach a polling threshold of 15 percent. Gary Johnson did not hit this number in 2016 despite running against two highly disliked major party candidates in an anti-establishment year. There is little reason to believe that Amash can raise enough money to reach the threshold in a less favorable year.
2. Satisfaction with Major Party Candidates: Voters in the two major parties are broadly satisfied with their choices. Trump has consolidated support among Republicans—enough to stave-off a primary challenger even after getting impeached. Democrats are mostly concerned with ousting Trump. The election looks to be a referendum on Trump in which neither side will be clamoring for another choice—especially one who could function as a spoiler.
3. Risk of Helping Trump: Insofar as Amash would be running with the primary goal of pushing back against the Trumpian drift of the Republican Party and conservative movement, running as a Libertarian would likely backfire. Available polling suggests Amash would draw more from Biden than Trump—potentially enough to tip the election in swing states like Michigan.
I’m reluctant, however, to take a short position based on these factors. All of these reasons are basically irrelevant if Amash decides that he wants to take advantage of the Libertarian Party’s infrastructure while the nomination is there for the taking. He is highly unlikely to get re-elected to Congress and might conclude that there is no room for him in today’s Republican Party anyway.
I don’t have enough insight on Amash’s personal preferences and decision-making process to bet one way or the other with confidence.For more thoughts on this market, see our recent podcast here:
Pratik Chougule is a contributor to Star Spangled Gamblers and author of the e-book How to Make Money from Political Predictions: A Guide to Generating High, Steady Returns on PredictIt. Follow him on Twitter @pjchougule.