We’ll likely know who’ll be the next president of the United States within 24 hours.
But terms such as electoral colleges and swing states are a language far removed from Australian politics.
For many who are not avid followers of the US electoral system, it’s easy to get lost in it all. Thankfully, help is at hand from Joseph Capurso, senior currency strategist at the Commonwealth Bank.
Here’s his explanation of the differences between the two electoral systems:
In Australia, the party with a majority of seats in the House of Representatives forms government. In Australia, the political parties elect the Prime Minister instead of the voters. In the US, people vote for ‘electoral colleges’ who in turn elect the President. Generally, the electoral colleges follow the preference of the voters in their state when selecting the President.
In Australia, each electorate in the House of Representatives contains similar numbers of voters. In the US, states have different numbers of electoral votes that reflect the state’s population. There are 538 electoral votes in this year’s election. This means 270 electoral votes are needed to become President.
Because most seats elect the same party over time, the marginal seats decide the election outcome in Australia. In the US, most states vote for the same party from one election to the next. This means the ‘swing states’ – states that may change which party they elect from one election to another – often decide who becomes President. According to Real Clear Politics, there are eleven swing states with 132 electoral votes, although analysts disagree on the number of swing states.
And there it is. A simple explanation to make you an instant expert in three short paragraphs.
On the swing states that will almost certainly decide the outcome, Capurso notes, using analysis from real Clear Politics, that Trump is currently leading in seven states with 61 electoral votes, while Clinton is ahead in five, with 71 electoral votes.
But the polls are close in many, as this table from the Commonwealth Bank shows.
The outcome, given the number of votes they contain, is anything but certain with margins in many states less than 3%.
“Who will win the US presidential election is very uncertain because the margins of lead in the swing states are generally small and within typical polling errors,” says Capurso.
Given the attention that voting in these states will receive, poll closing times, when media outlets are expected to start releasing exit poll results, could not only provide an indication as to who will likely take the presidency, but also generate significant market volatility as early as 11am in Sydney, particularly should Trump lead in Florida.
Other states to watch include Ohio and North Carolina where polling booths will shut 11.30am AEDT.
As Capurso correctly, and importantly, points out, exit polls have a chequered history of accurately predicting the outcome and lead margin of the vote, something markets found out all too well during the Brexit referendum.
News outlets are not permitted to predict the winner until voting closes on America’s west coast at 3pm AEDT. In the absence of very tight race, it’s likely that markets will move to reflect the likely winner well in advance of the embargo lifting.
We’ll see tomorrow.
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