Betting markets underestimate the chances of a Biden–Trump rematch

Expert forecasters say there is over a 90% chance Biden will be the Democrat nominee, while betting markets imply there is just a 75% chance

Betting markets underestimate the chances of a Biden–Trump rematch
Illustration by Laurel Molly, © All Rights Reserved

Key takeaways:

  • The chances are very high that Trump (89%) and Biden (91%) will be the presidential nominees.
  • Even if he receives a felony conviction before the Republican National Convention, Trump is highly likely to be the nominee (84%).
  • Assuming Trump is the Republican nominee, a felony conviction would still hinder Trump’s general election campaign, with his re-election chances dropping from 48% to 37%.

One of the key determinants of the outcome of the 2024 US Presidential Election will be which candidates are nominated by the Republican and Democratic parties this summer. This election will significantly influence domestic US policies, American geopolitical relationships, and the state of democracy as a whole. In particular, a victory for Donald Trump is likely to affect the course of the Ukraine war, the strength of international institutions such as NATO and the UN, the battle between democracy and authoritarianism, the Gaza conflict, and more issues of international importance. Domestically, it may reignite popular issues from his first term in office, such as immigration and voting rights.

At the time of writing, the presidential nominees for the Democrats and Republicans have not been settled. While Biden and Trump are frontrunners, there has been some consideration of the possibility that Biden may step down, and Trump’s chances of winning the GOP nomination may be threatened by legal challenges that have pushed the odds of their nominations down in the betting markets. Swift’s expert forecasters think that these odds are substantially below the true odds, for both Trump’s and Biden’s chances.

Our forecasters considered four key claims:

  1. Are the betting markets’ odds of Trump and Biden being nominated accurate?
  2. If Trump has a felony conviction, will Republicans still nominate him?
  3. Who will win the 2024 Presidential Election? Who will win if Trump is convicted?
  4. Would replacing Biden as the nominee improve the Democrats’ chances? 

Trump is very likely to be nominated as the Republican presidential candidate 

Our forecasters predict that those hoping that Trump will fail to be the Republican nominee will likely be disappointed. They predicted an aggregate 89% chance that Trump will be a presidential nominee on election day.

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At the time of prediction, betting markets were much less confident, setting predictive odds around 75% (PredictIt) or 79% (Betfair) that he will be selected as the nominee at the Republican National Convention (RNC) — a lower bar to achieve than the question forecasters looked at. These platforms have since adjusted their figures to 85% and 87%, moving closer to our forecasters' higher estimates.

Trump’s commanding victory with 51% of the vote in the Iowa caucuses today will strengthen his position going into the New Hampshire primary next week. Ron DeSantis came in second place, beating Nikki Haley by just 2 percentage points. Given this narrow margin between the two, it is unlikely that either will drop out before the upcoming New Hampshire and South Carolina primaries. Vivek Ramaswamy has already suspended his campaign today, but he was never considered a serious contender anyway.

However, historically speaking, the Iowa caucuses have only correctly predicted the eventual Republican nominee in two of the last five election cycles.

The key reason for our forecasters’ confidence is Trump’s immense popularity. Trump has a strong lead in the polls, far outstripping his rivals Ron DeSantis and Nikki Haley; for instance, the RealClearPolitics polling average has Trump with a 49.4-point lead over Ron DeSantis in second place. Additionally, there is little time for another candidate to break through. One forecaster said:

Trump has won the Iowa caucus, and the New Hampshire primary is only a week away. Within a week, then, Trump may have won both, giving him additional momentum going into Nevada. It's not a mystery how this will turn out.

The primary source of uncertainty for Trump's renomination is the likelihood and impact of a felony conviction, as well as possible health issues.

Trump might be convicted, but it is unlikely to prevent his nomination

Trump currently faces four felony charges: inciting insurrection in DC, engaging in electoral interference in Georgia, paying hush money in New York, and mishandling classified documents in Florida. If he is convicted on any of these charges, he may be barred from standing for election, since it is likely to contravene Section 3 of the 14th Amendment. The state supreme courts of Colorado and Maine have ruled that he cannot be on the ballot in those states because of this, although both of these decisions are under appeal, and other blue states might follow their lead. The US Supreme Court has not yet ruled whether the 14th Amendment applies to the current or former presidents.

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The first question is whether any of these cases will be successful in time to stop his nomination. Our forecasters’ aggregate probability of a felony conviction before the RNC is 40%, with predictions ranging from 25% to 55%. They cite the timeline of the trials as the primary reason, with one forecaster outlining how the nomination decision will likely be finalised before the cases are resolved:

One trial is scheduled to begin in March, and another is not even scheduled until the beginning of May. This is likely too late: Super Tuesday is on March 5th and by the end of March, Trump should have either clinched the nomination or come close.

In addition, the conservative-dominated Supreme Court and Trump-supporting judges may attempt to delay or overturn the various indictments. One source predicts that it is 40% likely that the Supreme Court will either reverse the Colorado decision or vacate it in a way that leaves it open to further Section 3 litigation, which would delay a final verdict further. The author considers it only 15% likely that they affirm it. Our forecasters agree that most cases will likely fail or be delayed long enough for Trump to win the nomination, with potential exceptions being the DC insurrection and New York hush money cases (both of which are in blue states).

Even if there were a conviction, it may not be deemed serious enough to keep him from the ballot. Assuming he has a felony conviction, the aggregate view of our forecasters is that there is an 84% chance that Trump will win the nomination, which is only a five percentage point drop from the baseline of 89%.

One major factor is that Trump loyalists tend to perceive the legal actions as a liberal conspiracy, unlikely to significantly influence their decision-making. While a recent poll revealed that a quarter of Trump’s supporters said he should not be on the ballot if convicted of a felony charge, those reservations may not be ‘sticky’. One forecaster said:

The history of his support shows that we can count on psychological defence mechanisms like rationalisation rather than rational analysis.

These forecasts are a marked change from our last analysis of the impact of the charges against Trump, and view Trump’s position as far more favourable.

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A significant driver of the remaining 13 percentage points of uncertainty is not that primary voters will change their minds, but because of what might occur at the RNC and afterwards. Assuming Trump is convicted before the RNC and wins a majority of delegates during the primaries, our forecasters put an 88% chance he will be the nominee on election day. One forecaster summarises what they see changing if Trump is convicted of a felony:

Almost all of the risk to Trump's candidacy comes from the possibility that delegates at the Republican National Convention panic and unbind themselves from Trump as they face the prospect of having a US President in jail.

However, the dominant view is that the Republican Party are very unlikely to disqualify him, with one forecaster saying "they would lose his supporters and face very credible threats of violence". In many forecasters' eyes, possible health issues are the dominant factor.

The chances of health issues ending Trump's re-election campaign

Some consider Trump’s health a liability: he is 77 and was hospitalised with SARS-CoV-2 during the pandemic. One forecaster said:

Trump is not physically or mentally healthy. I’d estimate a 4-5% chance of him dying before the 2024 election, compared to the 6.5% of actuarial tables.

Some pointed out his exceptional access to healthcare as a mark against this reasoning:

He is old enough that there is an increased chance of a major health event or death, but leaders and former leaders tend to live longer than most people their age due to superior access to health care, such as access to regular physicals, near-instantaneous access to CPR and defibrillation, and top-of-the-line medical care.

Our forecasters’ general consensus on the likelihood of his death being between one and six percent explained a meaningful part of the probability that Trump would fail to be the Republican Party nominee on election day.

The Democrats are very likely to stick with Biden

The narrative that Joe Biden is too old to be president and is prone to age-related gaffes has stuck, even with Democratic voters. Biden would be 86 by the time his second term ended if elected. One forecaster put it thus: 

‘Biden is just too old to be an effective president’ is a statement that 71% of likely voters agreed with. The election might be the Old Guy vs. the Criminal, in the eyes of many.

Despite this, our forecasters predict an aggregate probability of 91% that he will be the Democratic nominee come election day. Once again, this prediction is significantly higher than the betting odds available on PredictIt (75%) and Betfair (72%) for him being elected as the nominee at the Democratic National Convention (a lower bar). 

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Our forecasters exhibited a high degree of consensus on this question, contradicting the media speculation that Biden may step down. They often contended that it is too late to find an effective replacement, both because it is late in the process and because no obvious alternatives exist. In addition, some argue that Biden’s health remains good despite his age, comfortably passing his most recent health check, and he has gone on record to say that he will not step down while Trump remains the Republican frontrunner.

Who will win the Presidential Election?

While there was no consensus on the matter, the aggregate estimate of our forecasters’ predictions gives the Democrats an edge over the Republicans, assuming that Trump and Biden are their parties’ nominees and that Trump is not convicted before election day. As a group, they put Trump's chances of winning the election at 48% and Biden's at 52% (assuming they are both their parties' nominees on election day).

Trump’s main advantages are his immense popularity among his base and Biden’s current unpopularity among their usual voters. Trump is likely to get the MAGA voters out in large numbers, while Biden’s economic policies have failed to dramatically improve voters’ economic outlooks and his foreign policy has faced criticism and mixed reviews. Even if the US economy is in good shape from now until the election, the effect of recent inflation on prices means there is a good chance voters’ negative sentiments about the economy remain.

By contrast, the main reasons for Democrat optimism are Trump’s various instabilities. Forecasters pointed to the high disapproval rates in CBS polling of public opinion on the DC insurrection, Trump’s continued trend of inflammatory statements, and fear of his presidency’s effect on democracy as reasons that voters — moderates and independents in particular — might be alienated and reminded of why they voted against him in 2020.

A felony charge for Trump will likely lose him the election

Our forecasters’ aggregate estimate of 48% for Trump falls by 11 percentage points if Trump has a felony conviction. They contend that the Republicans will likely opt to break new ground by having a convicted felon as their presidential candidate, but that the felony conviction will likely break his support among the independents. The New York Times/Siena poll, for instance, puts a felony conviction as worth a five-point swing towards Biden in battleground states, and an Ipsos poll revealed that 66% of independents say they would not vote for Trump if he is convicted of a felony by a jury. One forecaster, who predicted a slight edge for Biden, said:

It probably won't be quite that stark on election day, but it should be good for a few points in swing states.
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This drop reveals just how significant the process and outcome of the cases are. Another consideration is whether Trump might run as a third-party candidate if the Republican party fails to nominate him. Our forecasters believe that the split in vote between Trump and the Republican nominee will all but guarantee a Democratic win, pointing to the 1912 election as precedent. 

Replacing Biden won't help the Democrats

Given speculation about Biden’s candidacy, our forecasters were asked to consider whether another candidate would fare better than Biden against Trump in the presidential election. The aggregate forecast is that the Democrats' chances of winning the 2024 election are slightly better if Biden is the nominee.

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Although Biden is currently polling poorly, our forecasters argued that the relationship between polling and voting intention is too weak at this stage, pointing at the disconnect between polling and the results of the mid-terms as an example. Regardless of lower approval ratings, some forecasters give Biden and the Democrats over a 60% chance of winning.

Summary

Our forecasts favour Donald Trump and Joe Biden as their respective party nominees for the 2024 Presidential Election. Our forecasters are relatively confident in both of these predictions, deviating significantly from the betting markets.

Despite legal challenges and health concerns, Trump's nomination probability stands at a robust 89%, supported by his significant lead in polls and unwavering base, even in light of potential felony convictions. The chances of his nomination barely falter even if he is convicted before the Republican National Convention, dropping only to 84%. This resilience in Trump's candidacy stems largely from his supporters' tendency to view legal actions against him with skepticism, often dismissing them as part of a liberal conspiracy.

Meanwhile, Joe Biden emerges as the likely Democratic nominee with a 91% probability, with the absence of a strong alternative and Biden’s commitment to contest against Trump solidifying his position. Our analysis suggests that replacing Biden at this juncture would not help the Democrats' prospects for the Presidental Election.

Looking towards the general election, our aggregate forecast slightly favours the Democrats, assuming Trump and Biden are the nominees and Trump avoids a pre-election felony conviction. We estimate Trump's chances at 48% and Biden's at 52%, despite Trump's solid base of MAGA support and Biden’s perceived weaknesses in policy and public appeal. A felony conviction for Trump could be a game-changer, potentially swinging the vote in key battleground states and significantly diminishing his chances. However, at 37%, it remains highly plausible that American voters elect a convicted felon in 2024.

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Illustration by Laurel Molly ©