Somewhere during everybody else’s lunch hour on Friday on the East Coast, the members of the 118th United States Congress for the 12th time in four days rejected a bid from Republican Kevin McCarthy to become the Speaker of the House. That reality was clear within the first 20 minutes, after Republican rebel leader Rep. Matt Gaetz of Florida cast the fifth vote against McCarthy, making it mathematically impossible for McCarthy to clear the 218-vote threshold he needed to become third in line for the presidency.
Even so, minute by minute the McCarthy “market” continued to gyrate in, for clever bettors, thrilling ways that mimic the intragame betting of a wild, high-scoring football game. The 12th vote was special because it represented the first time McCarthy’s long negotiations showed any signs of paying off; he went from 21 defectors in polls No. 4 through 11 all the way down to seven in vote No. 12.
As McCarthy’s vote totals have fluctuated, so have the prices associated with shares of his potential future “speakerhood” on PredictIt, a platform that allows people to buy such commodities as if they were tangible goods or part of a company.
Kevin McCarthy rising and falling on PredictIt
Accordingly, the price of buying a share of McCarthy-to-win on PredicIt, which began the day around 54 cents, bounced into the mid-60s at noon ET on reports of a deal with a contingent of rebels and as the vote began and surged into the 70s during that vote.
What happened during the gamevote, however, was a bit more complicated. Every time a previous anti-McCarthyite stood up to flip to his side, the price would pop about 10 cents or so – only to tank by a nickel or more the next time a Never-Kevin holdout held firm and voted no. The actual potential outcome of the vote itself never changed – McCarthy would lose yet again – but if you spotted that pattern, as many braggarts on the PredictIt’s very busy Speaker of the House message board claimed later they had, you could make quite a lot of money in that hour buying and selling and buying shares again over and over.
It was clear that there was a population of people following this who believed that any defection harmed McCarthy’s odds and any movement in his direction meant he had the thing in the bag.
Spoiler alert: As of the publication of this report, he does not have it in the bag. After vote No. 13 – another failure for McCarthy — reduced the anti-McCarthy side to six, the House went into recess until 10 p.m. Presumably, that was to give him time to shore things up; he needs now to flip just two votes to clinch America’s most thankless job.
Could McCarthy futures pay off in the end?
McCarthy left the chamber and told reporters he would get the votes and the betting market clearly believed him. By 4 p.m. ET, it cost 95 cents to buy a share of McCarthy-to-win. Conversely, the cost of betting on Rep. Steve Scalise of Louisiana to win dwindled from 32 cents at noon all the way to a penny as the low winter sun set on Washington, DC. (Scalise, the new Republican House Majority Leader, has said he is not a candidate for the job, but most observers think if McCarthy withdraws, the rebels will accept Scalise as the next alternative.)
“Why so confident he has the votes, when he clearly doesn’t?” someone called CobraDongLarry asked at about 4:15 p.m. on PredictIt’s message board. “Seems worth 9 cents to me.” He was met with scorn, mockery, and misinformation for his eminently reasonable bafflement. One respondent claimed Gaetz himself had said McCarthy probably has the votes, which indeed probably be the put-away shot if true; there was no report of that nature anywhere.
This McCarthy mess may turn out to be PredictIt’s big (17 million shares traded as of Friday evening) and unexpected (there hadn’t been a multi-ballot race for Speaker in a century) swan song. The site operates as an academic experiment with the permission of the Commodities Futures Trading Commission, but that permission appears likely to be revoked in mid-February because it’s all become too indistinguishable from a sports book.
There aren’t really any interesting questions left to be definitively answered between now and then in American politics –the 2024 presidential candidates won’t be settled for at least a year – so the Speaker drama could be a finale of sorts.
Perhaps rather than shutting this system down, the CFTC might demand some changes to protect consumers. It is baffling, for instance, that as of Thursday you could buy a share of Jeffries-wins 3 cents. Rep. Hakeem Jeffries of New York is the Democratic leader in the House; there is no universe in which he’d be Speaker with a Republican majority, however slim and dysfunctional. There are many examples of people wagering on outcomes that are simply, practically impossible.
If this is the end of the road for PredictIt, folks who get a charge out of betting on politics better indulge on this spectacle. It certainly makes watching C-SPAN a great deal more fun.
