Rupert Cornwell: On the battle for America

The first votes will be cast in Iowa this week, with neither party yet having a clear favourite to stand for the big job. But whoever eventually emerges victorious, November's election will transform the nation and have a massive impact on the wider world
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To paraphrase Winston Churchill's remark apropos of the British victory at El Alamein, Thursday evening's caucuses in the midwestern state of Iowa are not the end, nor even the beginning of the end. But at least they will be the end of the beginning for the struggle that is set to dominate news from the United States for the next 12 months.

If a US presidential election is the political campaign equivalent of world war waged over years, on a myriad different fronts then this is the moment when the first phase ends. After an eternity of opinion polls and candidates' debates, speechifying and squabbling, finally a small number of Americans will actually cast votes that count.

Perhaps fewer than 250,000 people, barely 1 in ten of eligible Iowans, will participate in the curious gatherings in church halls, precinct clubs and private living rooms across Iowa that kick off the primary season. But what they decide will disproportionately influence the ultimate selection of the Republican and Democratic nominees. By the end of February, the bulk of the states will have had their say, and those nominees may already be clear. The process however will not be complete until 4 November 2008, when the country's voters will choose a successor to George W Bush. And this time, as rarely before, the whole world will be watching.

American presidential elections fall into several categories. Some are reactive, such as in 1976, when the voters chose squeaky-clean Jimmy Carter to purge the political air of Watergate and the disgraced Richard Nixon. Others, like George Bush Snr's succession of Ronald Reagan in 1988, merely extend the status quo. Some deliver less change than they promise for instance Bill Clinton's victory four years later that ended 12 years of Republican rule. Yet others, most notably the present Bush's Supreme Court-decreed win over Al Gore in 2000, are accidents.

But just a few are, to use the pundits' jargon, "transformational", propelling the country on a fundamentally new course. The advent of Franklin Roosevelt in 1932 was one such, ushering in a generation of Democratic dominance. Another was Reagan's landslide win in 1980, that launched a similar period of conservative ascendancy. Now the 2008 election could be of similar import.

For one thing, this is the first election since 1928 when neither a sitting president or vice-president is vying for his party's nomination. For another, there is a palpable yearning for an end to the presidency of George W Bush. Americans essentially have tuned him out. His approval rating has been stuck at 35 per cent or less for 18 months. For the year or so left to him in office, his influence on domestic policy matters is exclusively negative the power not to create but, thanks to his veto, to deny.

But, third and most important, the conservatism that has held sway for almost three decades is bankrupt. The Republican minority may hold together in Congress just enough to thwart almost every Democratic initiative. But the coalition that has kept the Republicans in power, between southern-centred social conservatives and old-style business conservatives, is coming apart. Thanks to Mr Bush, the party has even lost its reputation for competence. As a result, the desire of voters may be summed up in a single word: change.

And a single figure is enough to explain why. Bush's fortunes may no longer be falling, and the war in Iraq, until lately the main concern of voters, has been going slightly better of late, tactically if not strategically. But his countrymen are in a funk. Fully 70 per cent believe America is "on the wrong track". Not since the Carter era of soaring energy prices, the humiliating hostage crisis in Iran, and what was perceived as a weak and vacillating presidency has the US been in so measurably sour a mood. The system just doesn't seem to be working.

The average American is famous for paying little attention to what goes on beyond the ocean's edge. But in their different ways, the decline of both the dollar and America's reputation, symbols of diminished US economic and moral authority, are ever harder to ignore. Then there are the specific problems: old ones, like a dysfunctional healthcare system and runaway education costs; and newer ones, such as the ever-growing disparity between rich and poor, making a mockery of the country's egalitarian roots.

And then there is the economy. The sub-prime mortgage crisis has spawned a credit crunch that could well bring the most painful recession since the early 1980s. No less a seer than the former Federal Reserve chairman, Alan Greenspan, (whose own reputation admittedly is much tarnished by the sub-prime mess) now reckons that the chances of avoiding recession in 2008 are no better than 50/50. At the very least, growth will slow sharply for the next few months. That means fewer new jobs, higher unemployment and probably a surge in protectionist pressures.

That said, the US remains not only the wealthiest country on earth, but in its way also one of the most conservative. In America, never underestimate the forces of inertia. But on almost every issue, the pendulum is swinging. Reagan used to complain that "government is part of the problem". Now a majority of Americans tends to see government as part of the solution to help the country through the tougher times ahead. In the meantime, the economy has replaced Iraq and national security, normally the Republicans' hole card issue, as the main concern of voters. In short, this is an election the Democrats should win. Indeed, if they don't, the party might consider moving from politics to, say, the grocery business.

The Republican muddle is evident in the confused battle for the nomination. Normally the party picks a favourite early Reagan in 1980, Bush Snr in 1988, Bob Dole in 1996 and the younger Bush in 2000 and sticks with him. This time there is no Republican front runner. In Iowa the fierce battle between the ordained Baptist minister Mike Huckabee, and the former governor and corporate executive Mitt Romney, running on a platform of managerial competence, embodies the social conservative/business conservative split. But Rudi Giuliani and John McCain, even the lethargic former actor Fred Thompson, also have plausible shots at the nomination. Amazingly, at a stage when the scent of coronation is normally in the air, the Republican contest could go any one of five ways.

The Democratic race on paper is almost as complicated. In fact it is more straightforward. The field must be among the strongest ever. In what other year would three men of the calibre and credentials of Senators Joe Biden and Chris Dodd, and incumbent governor Bill Richardson, be distant also-rans, or a former vice-presidential nominee and mesmeric speaker like John Edwards no more than a dark horse?

The polls say that Edwards could win Iowa in which case, the entire Democratic dynamic might change. But the real battle, and metaphor for the dilemma facing the country, is between Hillary Clinton and Barack Obama. It is a reasonable bet that, 12 months from today, the president-elect not only will be a Democrat, but also either a woman or a black man (and incidentally the first incumbent Senator to have won the White House since John Kennedy in 1960).

Both Clinton and Obama are highly talented politicians, but each of their candidacies requires a leap of faith. For Clinton, the problem is how to reconcile the twin themes of experience and change. She says her experience eight years as a highly involved First Lady in the 1990s and then seven years as Senator for New York will enable her to hit the ground running when she enters the Oval Office. But what change would she embody, when her entire campaign feels like a Clinton restoration?

Hillary Clinton exudes competence, yet her most powerful asset, and most effective cheerleader, is her husband. Bill Clinton's lust to get back into the political game is plain at his every public appearance.

So what will be his role in a White House run by his wife? Do Americans really want to risk an eight-year rerun of the Clinton marital psychodrama and do they really want alternating rule by Bush and Clinton dynasties? The next few months, quite possibly the next few weeks, will provide the answer.

And what of Barack Obama? Not even the young Clinton exuded such freshness and promise as a candidate. No one can promise an end to bickering partisan "politics as usual" as he. But after just three years' service in the Senate, is Obama qualified for the job? He would indeed represent, to use Bill Clinton's words, "a roll of the dice". But then again, Americans are ready to do just that.

At this point, foreign affairs the area where Bush, as commander-in-chief and formulator of US policy remains eminently relevant could play a crucial part. The rule of thumb for 2008 is that the calmer things are abroad, the more likely it is that voters' yearning for change will trump the desire for a proven pair of hands on the national tiller.

Until last week, the tide had appeared to be running in favour of change and thus, on the Democratic side, in favour of Obama. The next President will inherit the problem of when, and how fast, to withdraw the 100,000-odd US troops still in Iraq when he takes over on 20 January 2009. But US casualties are down, and a measure of security is returning to Iraqi cities. Suicide bombings are no longer front-page news.

Similarly, now that America's spy services have concluded that Tehran halted its nuclear weapons programme in 2003, the prospect of a US military strike against Iran has receded, removing one other major variable from the campaign chess board.

But the assassination of Benazir Bhutto may change these calculations. Even if Pakistan, a key US ally, somehow muddles through the year ahead, her murder has thrust terrorism and national security front and centre of the political debate once more. Experience may yet trump change.

The biggest wild card of all, however, would be a major terrorist incident on US soil. Whether because of efficient policing or just dumb luck, there has not been one since September 2001. But suppose a suicide bomber struck in the quiet American heartland at a shopping mall in somewhere like Iowa, say all bets would be off.

George Bush won the 2002 mid-term election and his own re-election in 2004 by playing on American fears, and painting the Democrats as unable to keep the country safe. Another terrorist attack in summer or autumn could allow the Republicans to pull off a similar trick next year. Next year is set to be a transformational one for America. It is also utterly unpredictable.

The road to the White House

3 January: The first caucus of the season is held in Iowa

8 January: The first primary of the season takes place in New Hampshire

5 February: Super Tuesday, when 22 states hold presidential primaries and caucuses

3 June: Last two state primaries

25 to 28 August: Democratic national convention takes place in Denver, Colorado

1 to 4 September: Republican National convention is held in Minneapolis, Minnesota

26 September: First presidential debate on domestic policy

5 October: Final presidential debate on foreign policy

4 November: The United States elects its 44th president