There's a good article on the front page...

...of the New York Times today that sheds more light on the Sarah Palin resignation story:

http://www.nytimes.com/2009/07/13/us/politics/13palin.html?_r=1&hp

It's still not clear to me whether or not Palin is running in 2012, but I think the prospect terrifies the Republican establishment to the extent that they might mount an Anybody But Palin movement much like the Democrats tried unsuccessfully to nominate Anybody But Carter in 1976. A Romney-Huckabee ticket could be the answer.

Republicans like to nominate whoever is next in line and it could be argued that it's now Mitt Romney's turn. He certainly looks the part, has an outstanding resume, and is presumably an expert on the economy. He's also demonstrated the ability to raise lots of money and has distinguished himself lately as one of the last grownups in the party. Huckabee could help shore up the religious right and therefore box out Palin. He reportedly despised Romney (as did McCain) in the 2008 primaries but that's never been known to stand in the way of raw ambition before. (Just ask LBJ.)

On the other hand, Romney is a horrible campaigner and performed poorly last time around despite a ton of money and a weak field. He may have learned a thing or two; we'll see. It's hard to get excited about Romney (unless you're a Mormon) and he's been a shameless panderer and flip-flopper in the past. I don't think that works as well nowadays; the electorate is more sophisticated than it used to be. I still think Newt Gingrich or more likely, None of the Above, are better bets for the nomination.

But Palin still has a lot of support among rank-and-file Republicans. Her numbers with them are impressive, even after this latest debacle. It's a long shot, but Palin could still conceivably blitzkrieg her way to the nomination in 2012, despite an ABP movement.

I had assumed that 2012 would essentially be a replay of 1984, with Obama playing the role of Reagan and some garden-variety Republican like Romney playing the sacrificial lamb role of Mondale. Just as Reagan's tax cuts jump-started the economy in time for the next election, so should the Fed's zero interest rates and Obama's stimulus kick in by 2012. The election should be a landslide victory for the incumbent. If Palin were to get the nomination, however, I would expect a landslide also, but more along the lines of a Goldwater or a McGovern. That is to say, a complete repudiation of the standard bearer's political philosophy. It could be a bloodbath of legendary proportions; Palin would have trouble carrying even her home state of Alaska.

But this could ultimately be good for the Republicans. Because if you look at it through the eyes of someone who's been in the markets his whole life, maybe what the Republican Party needs is a capitulation like this to form a bottom. Only then will they get serious about rebuilding their brand.