Pat Buchanan: Mitt Romney is the Republican most likely to win

IN JULY 1861, the Union Army marched out of the capital to meet the Confederates forming up at Manassas. Washingtonians packed picnic lunches and followed to enjoy the rebel rout.By nightfall, the Union Army was straggling back to the city. Stunned and panicked spectators had already returned to report the defeat of Gen. McDowell's forces. What the First Battle of Bull Run meant was that the rebels were stronger and tougher than anticipated, and Mr. Lincoln's war was not going to be easy or short.In Republican presidential politics, the Iowa straw poll, held the August before the January caucuses, serves the role of Bull Run. It is the first major skirmish of the presidential season and registers the appeal of a candidate to the nation's first voters, the strength of his organization and the extent of his financial resources,Thus, it is a stunning development that Rudy Giuliani, then John McCain, just pulled out of the Iowa straw poll on Aug. 11.

What seems to have happened is this.

Having spent less time in Iowa than McCain or Mitt Romney, with an organization regarded as feeble compared to theirs, Rudy feared a crushing defeat on Aug. 11 that would have destroyed his aura as frontrunner. Rather than be humiliated, he elected to forfeit the game.

That left McCain nothing to gain on Aug. 11, but a lot to lose. Now, he could not claim to have defeated Rudy, his main rival, but he would risk an embarrassing loss to Romney, who leads in many Iowa polls and whose organization is said to be the strongest in the state.

Bottom line: Mitt Romney is now the favorite to win the Iowa caucuses in January, eight days before New Hampshire.

And recall: John Kerry's three-point victory in Iowa in 2004 propelled him to victory in New Hampshire and virtually every other primary save South Carolina and Oklahoma.

There is a real question today whether Rudy, whose liberal stance on gay rights and right-to-life is anathema to most Iowa Republicans, will even play in the caucuses. Why risk a death blow to his candidacy in what may be one of Rudy's weakest states?

McCain has to consider whether he, too, wants to risk a defeat there in January, which could be fatal to his candidacy, or whether he is not better advised to await Romney in New Hampshire, the way he did George W. Bush in 2000, when McCain -- wisely, it turned out -- ducked Iowa altogether.

The withdrawal of Rudy and McCain not only dims their luster, it puts pressure on Romney to run up the score on Aug. 11 and show intimidating strength. And it presents an opening for one of the second-tier candidates -- former Govs. Mike Huckabee, Tommy Thompson and Jim Gilmore, Reps. Duncan Hunter, Tom Tancredo and Ron Paul, and Sen. Sam Brownback -- to break out of the pack.

Whoever now runs second to Romney in the straw poll -- especially if he can put distance between himself and No. 3 -- will begin to attract attention from the media and see his contributions increase.

The McCain-Giuliani cop-out will cause Fred Thompson to review his strategy. Wisely, he has passed up the straw poll. This would have cost him hundreds of thousands of campaign cash for a tent, tickets, food and buses at the all-day affair in Ames and availed him nothing. For his late entry would have precluded a first- or second-place finish.

Thompson now has to ask himself whether he should even go to Iowa -- or do as McCain did in 2000, skip the state and take his stand in New Hampshire.

Writing off Iowa makes sense for Thompson. For it is hard to see how he could make up for the lost six months he has already ceded to the other candidates in organizing the state.

The same would hold true for Newt Gingrich, should he decide to run, which appears unlikely now that Fred Thompson has moved into the vacuum left by conservative dissatisfaction with the front-runners. But should Newt get in, it would make no sense for him to go to Iowa and play against a deck that seems stacked for Romney. Better to wait for New Hampshire.

Neither the Iowa straw poll nor the caucuses are necessarily decisive. Sen. Phil Gramm won the straw poll in 1996. George H.W. Bush defeated Ronald Reagan in the caucuses of 1980.

But the Iowa caucuses have always been important, and often crucial.

Jimmy Carter's victory led to the nomination in 1976. Kerry's victory led to the nomination. George W. Bush's smashing victory in the Iowa straw poll of 1999 and follow-on triumph in the caucuses propelled him through defeat in New Hampshire to the White House.

Mitt Romney has been robbed of a triumph over his two main rivals on Aug. 11. They evaded the trap he had set. But in running Rudy and John out of Ames, Romney has shown real strength, and must now be the favorite to take Iowa in January and probably is the man to beat in New Hampshire.

Romney Tops $1 Million in Arizona

Former Massachusetts Gov. Mitt Romney has topped $1 million in contributions in Arizona, the home state of presidential rival John McCain, Romney campaign officials said Wednesday.Sen. McCain's campaign spokesman Danny Diaz dismissed the announcement by the Romney campaign, saying McCain has raised more than twice that amount in Arizona.
Romney is expected to add another $175,000 after speaking to 250 supporters at a fundraiser Wednesday night in Gilbert, a rapidly growing town east of Phoenix.

Romney called McCain a "terrific senator and American hero" but he differed with McCain on a number of key issues.

"My expectation is that I'll see him in a number of debates but when it is all said and done, I'll win the prize," Romney said.

Jason Rose, state director of Romney's campaign in Arizona, said McCain's support for an immigration reform bill has been tough for some Arizona Republicans to stomach. The bill combines tougher border security with an eventual path to citizenship for millions of illegal immigrants.

Romney has said the immigration reform measure "falls short of a workable solution to an important problem."

Cowboy Capitalism: European Myths, American Reality

By Olaf Gersemann.-
We have all heard the claim that, although the U.S. economy creates economic growth and jobs, Americans pay a huge price for their economic system in income inequality and other social problems. We hear, too, that average families can maintain their standard of living only because both parents work, that prosperity in the United States is largely debt-financed, and that the unemployment rate is so low only because so many people are behind bars. Such views are not all at uncommon in Europe. And, thanks in part to commentators such as Paul Krugman and Michael Moore, they also seem credible to a growing number of Americans, who accept uncritically that poverty is on the rise and that the middle class is disappearing.In Cowboy Capitalism: European Myths, American Reality, published this month by the Cato Institute, German reporter Olaf Gersemann revisits those common misperceptions of the American economy and demonstrates how misleading they are. Some, such as the examples noted above, are simply myths. The reality is quite different:
As of May 2001, only 1.5 percent of all working Americans held multiple jobs to stay afloat. (page 126)
Growth of wealth has outpaced debt, as the average American family increased its net worth by 50 percent between 1989 and 2001. (page 92)
In 1998 unemployment was only 0.1 to 0.2 percent lower than it would have been if the prison population had remained the same since 1985. (page 131)
Contrary to what one might expect, Gersemann concludes, the continental economies of Europe provide no meaningful advantage over that of the United States. The greater market freedoms in America create a more flexible, adaptable, and prosperous system than the declining welfare states of Europe.
Cowboy Capitalism is a devastating expose of the nonsensical myths that too many Europeans believe about Americans and the American economy. And it is the best current discussion of the American economy -- a solid rebuttal to the Cassandras and Krugmans who would have us believe that our economy is in dire straits.
In clear and accessible terms, Cowboy Capitalism separates the economic myths from the reality.
Myths vs. the Reality

Myth: Many people in the United States need two or three jobs to make ends meet.
Reality: As of May 2001, only 1.5 percent of all working Americans held multiple jobs to stay afloat. (page 126)

Myth: The American middle class is shrinking.
Reality: The share of households with annual incomes of more than $75,000, calculated in 2002 dollars, grew from 12.7 percent to 25.1 percent between 1972 and 2002. (page 118)

Myth: The poor in America are growing more numerous.
Reality: Between 1972 and 2002, the share of households with annual incomes of less than $35,000 declined from 44.9 percent to 40.6 percent. (page 118)

Myth: American wealth is debt financed.
Reality: Growth of wealth has outpaced debt, as the average American family increased its net worth by 50 percent between 1989 and 2001. (page 92)

Myth: Unemployment is low in the United States because so many people are behind bars.
Reality: The prison population makes only a minor contribution to the reduction in unemployment. In 1998, unemployment was only 0.1 to 0.2 percent lower than it would have been if the prison population had remained the same since 1985. (page 131)

Myth: In the United States the rich don't pay their fair share.
Reality: In 2001 almost 65 percent of U.S. federal income tax came from the 10 percent of households with the highest gross income. In Germany the top 10 percent contributed less than half the total intake. (page 151)

Myth: In the United States the poor are burdened by an unfair tax system.
Reality: In Germany 50 percent of households with lower-than-average incomes contribute almost 9 percent of German income tax revenues, whereas they contribute only 4 percent in the United States. (page 151)

Myth: European welfare provides better for the most needy than does the United States.
Reality: In the mid-1990s the poorest 30 percent received over 40 percent of welfare benefits in the United States. In Italy that figure was just 20 percent, and in France and Germany the numbers were just over 30 percent. (page 152)

Myth: The U.S. economy does not create enough jobs.
Reality: Between 1970 and 2003 the number of people employed in the United States rose by 58.9 million - a 75 percent increase. In France, Germany, and Italy combined, the figures were 17.6 million and 26 percent. Almost half the increase in Europe was due to the population bounce caused by German reunification. (page 21)

Myth: Government debt in the United States has rocketed ahead of European levels.
Reality:: True, in the United States government debt as a percentage of GDP (63.4 percent) is slightly higher than it was in the late 1980s, but it has increased by more than half in France and Germany (65.3 and 69.5 percent, respectively). (page 71)

Myth: The cost of day-to-day living has gone up.
Reality: An American who earned the average hourly wage of a production worker needed to work 8.7 minutes to be able to afford one pound of whole frozen turkey in 1980. In 2004 just 4.2 minutes sufficed. The prices of many other products that virtually every household buys to meet its basic needs (such as bread, sugar, coffee, electricity, and gasoline) have also lagged behind overall inflation. (page 88)

Myth: Living standards are higher in Europe than in the United States.
Reality: The United States has the highest living standard of any major industrialized nation. Adjusted for price-level differences, per capita income in the United States exceeded the French level by 36 percent in 2003. At 42 and 44 percent, respectively, Germany and Italy lagged even further behind. (pages 78 and 87)

Myth: Long-term unemployment is a chronic problem in the United States; European job creation schemes work better.
Reality: In the United States 65 percent of unemployed people found new work in less than three months in 2002. In France, Germany, and Italy, that figure is only 26 percent, 17 percent, and 12 percent, respectively. (page 178)

Myth: Europe is moving faster than the United States toward a knowledge-based economy.
Reality: In knowledge-intensive services (e.g., business services, health services), real output in the United States grew by no less than 195 percent between 1980 and 2003. In Germany and France the figures were only 118 and 103 percent, respectively.