With the fallout from Donald Trump's sacking of FBI Director James Comey causing shockwaves throughout US politics, a major gamble is under way on him leaving post early. Paul Krishnamurty weighs up this unprecedented, fast-moving story...
"Time is on the side of Trump's enemies. He is already running out of friends beyond the base and people are turning away jobs in the administration. Siding with the Democrats over an impeachment process - putting country before party - may very soon become electoral gold."
Everything about his unique campaign suggested the Trump presidency would not be a conventional one, and so it has proved. A mere 121 days in, Betfair punters are backing him to leave before the end of his first term.
Normally at this stage of the election cycle, betting on US politics would be focused on long-term markets like the next election or mid-terms. Yet overnight, while most Brits were sleeping, more than 5K was placed against Trump surviving a full-term. In our Trump Exit Date market, the odds about 2017 halved to 3.613/5. These stories take a few hours to filter through to British audiences so expect plenty more today.
While one must be wary when discussing Trump crises - given that so many have failed to halt his progress or dent his support - the row regarding his firing of FBI Director James Comey has dramatically escalated the scandal. Whereas there was previously only dubious, circumstantial reason to call for impeachment, Trump's pursuers now believe they have ample material and more seems to be emerging on a daily basis.
Let's recap. I've been writing on these pages about how the connections between the Trump campaign and Russia were a liability since last summer. Obviously it didn't hurt his election bid and many of us - including Hillary Clinton herself - believe Russia/Wikileaks propaganda ultimately swung the result. Yet perhaps because most media expected Trump to lose or because Clinton preferred to focus on identity politics, the scandal never really took centre-stage.
From the moment he was elected, that changed and it has now engulfed his presidency. His National Security Advisor Mike Flynn was forced out after lying about his Russian connections. Attorney General Jeff Sessions had to recuse himself from the Russian investigations going through Congress after changing his story. Comey confirmed that the FBI had been investigating these connections since last summer, and the US intelligence community have concluded that Russia tried to fix the election in favour of Trump.
By firing Comey - and contradicting the official White House explanation by saying on TV that the Russia investigation was a factor - Trump made the ultimate mistake by giving a negative story legs. The media are reporting a memo claiming Trump pressured Comey to drop the investigation. Other stories claim he asked about imprisoning journalists. In such a climate, a thorough, long-term investigation seems unavoidable.
If these kind of abuses of power are proven, we are in impeachment territory. So too, regarding Monday's bombshell story that Trump shared highly classified information about ISIS with the Russian government. With each passing day, Trump appears less qualified for the job, unable to comprehend the normal restrictions of executive power in a democracy. An approval rating below 40% is unprecedented so early in a presidency.
What next? The only thing protecting Trump is the loyalty of his base. His approval rating among Republicans remains high and Congress is fearful that siding with the Democrats on this will lead to a grassroots revolt. This was precisely the case before he was elected - either regarding the plot for a brokered convention, or when many turned against him over Pussygate.
After each crazy episode, Trump and his surrogates manage to spin the issue around to blame their critics and the 'lamestream media'. There is no evidence to suggest that this social media-led bubble is bursting, and these supporters may continue to insulate the president. I highly doubt Trump will quit either - he will cling grimly to power.
However, time is on the side of his enemies. Events have now ensured there will be long, detailed investigations into Russia connections. He is already running out of friends beyond the base and people are turning away jobs in the administration. The favourite to succeed Comey, John Cornyn, ruled himself out last night.
As the 2018 mid-terms approach, it will become an electoral neccesity for many more Republicans to distance themselves. Siding with the Democrats over an impeachment process - putting country before party - may very soon become electoral gold.
As for timing and bets, I've already bet against Trump winning a second term and last night, I backed him to leave before the end of his first term at 2.01/1 This is a much better value option than 2017 in our Trump Exit Date market. The 3.613/5 is now plenty short enough, considering that this process is unlikely to be quick, and 6.25/1 about 2018 seems much better from a trading perspective. If Trump is still in post next year, it is a stone-cold certainty that this and other scandals will continue to fuel speculation and ensure his administration remains in crisis.
* * *