Here Comes Health Care Reform

In a blog post this morning headlined "Health Care Resurrection," Paul Krugman alluded to the latest Intrade odds on reform. The likelihood of a health care overhaul is now trading at 62.5%, which is up nearly 10 points since yesterday and over 20 points since early last week.

Krugman claims he isn't completely convinced of the predictive power of political prediction markets, but he is keeping a close eye on Intrade.

"Betting markets don’t have any mystical power, but they do summarize conventional wisdom pretty well," he said, "and judging from Intrade, health reform has gone from a long shot to more likely than not."

But Business Insider suggests there's a better reason to pay even closer attention to the Intrade price on health care than Krugman purports: "What we're witnessing is the equivalent of political insider trading," said Joe Weisenthal. "This doesn't just reflect conventional wisdom. No, this is Washington DC insiders speaking here."

Weisenthal contacted Intrade CEO John Delaney, who said that a lot of the volume on the health care contract is coming from the Washington DC area.

The Bottom Line - If you haven't already invested in the health care contract, now might be a good time to get on board. Senator Specter just told MSNBC "momentum is building." Dan Rather, Katty Kay, Andrea Mitchell, and Joe Klein all predicted on Chris Matthews' Sunday show that health care reform will pass. Health and Human Services Secretary Sebellius told David Gregory on Meet the Press on Sunday that "we'll have the votes." Rachel Maddow predicted last night on her show that health care reform can't be stopped. Even if Pelosi loses her grip on the House and Congressman Stupak and his Blue Dog supporters somehow thwart the final effort, the contract is likely to keep climbing on Intrade in advance of the final whip count.

John Stossel: Health Care Reform Will Pass

John Stossel, who profiled Intrade on ABC's 20/20 before the 2008 election, is still tracking political prediction markets. Although he has since left ABC for Fox Business, Stossel has not stopped citing the wisdom of the crowd.

In a post on his Fox Business blog this afternoon, Stossel proclaimed: "Obamacare is coming."

"Uh -oh...the Intrade betting odds that Obamacare will pass are now above 50%," he wrote. "That means that smart people who put their money where their mouths are now think that it is likely that some form of Obamacare will pass before June 30th. The odds dropped as low as 20% after Scott Brown's election, but as I write this, the trading is at 52 cents (winners win a dollar for each 52 cent bet."

As of this writing, the health care contract is trading just above 55, down from the 60% mark it reached yesterday.

White House Press Secretary Robert Gibbs, of course, gave traders reason to feel bullish about health care reform yesterday.

During his daily briefing, he said: "I literally believe that what I said on a television show this morning was the President leaves for Indonesia and Australia on March 18th, and we believe that -- I believe that, based on conversations that I've had in the building, that we're on schedule to get this through the House by then."