Looking Ahead to 2008...

First, belated New Year greetings to everyone and in a way it was good to get back to normal (or what passes for normal) yesterday.

Following on my astonishing second place in the 2007 politicalbetting.com competition, the site this morning is full of predictions, prognostication and punditry (so no change there !).

The big political event of 2008 should be the US Presidential election. As I've said before, this is an election unlike any other in recent American history with neither the incumbent President nor Vice-President contesting. This means that BOTH the Democrats and the Republicans have to find a candidate and neither has a clear-cut frontrunner as the process begins today with the Iowa caucuses.

On the Republican side, Mitt Romney, Rudi Giuliani, Mike Huckabee and John McCain look the frontrunners with Fred Thompson and Ron Paul appearing to be also-rans. The first four named will be the players through the early stages and it may be some time (if at all) before a clear leader emerges. This may not be a pleasant process - my guess is that Rudi Giuliani will emerge from the "sea of electoral hazard" as the GOP candidate.

On the Democrat side, it's slightly more straightforward with Hillary Clinton facing a strong challenge from Barrack Obama and a lesser challenge from John Edwards. I think the Democrat choice is pivotal to this contest. Put simply, if the Dems want to win the White House, they will choose Obama - if they want to lose, they'll pick Clinton.

Hillary Clinton, while adored by many Democratic activists, is loathed by the powerful conservative media machine and seems, to me, quite unable to gain support from the ex-GOP supporters who voted for Democrat Senate and Congressional candidates in 2006. Faced with the conservative anti-Clinton barrage, these key voters will either return to the Republicans or abstain.

Barrack Obama is something new and while much of his message is vague and incoherent, there is little doubt he has been able to attract support from former GOP supporters. IF he can persuade enough Democrats that his appeal is more important than Hillary's experience, I believe he will be the next President of the United States.

There will be many twists and turns starting tonight but it should be fascinating to watch..

In Britain, meanwhile, this may be a year of "marking time" for the main parties. Thanks largely to a catalogue of misjudgements, blunders and downright incompetence, the Conservatives find themselves in a pre-eminent position but how much this is a vote of confidence in David Cameron and how much a verdict on Gordon Brown remains to be seen. There have been signs in the most recent polls of a small recovery in Labour fortunes and I suspect this will continue during the year despite the economic doom-sayers (such as the Mail on Sunday) predicting all kinds of fiscal armageddon.

Of course, the continuing strength of oil prices will be a worry though it may not be as bad in a couple of weeks as it appears now assuming calm in Pakistan and milder weather in the Northern Hemisphere but there will doubtless be other "shocks" during the year. Interest rates will fall but more slowly than most homeowners would like while the decline of the pound will continue.

MY prediction is that by year-end the Conservatives will only be 3-5% ahead of Labour with the Lib Dems under Nick Clegg trading in the 15-19% range.

Elsewhere, there are elections in Spain and New Zealand. I have no strong view on the former but in Wellington, time is running out for Helen Clark and the Labour Government. They trail the National Party by fifteen points which, if repeated in the autumn, would produce a massive landslide for National. Still, nothing is certain as we know.

Other predictions - Godolphin to win the Derby for the first time and Italy to win the Euro 2008 football championships but there'll be plenty to comment on through the year.