There are so many storylines and subplots to the 2012 election! One story deserving more attention, though, involves the motif of gambling, which ran throughout the 2012 election cycle.

It started during the primary contest when, as one of Romney’s first gaffes, he challenged Rick Perry to a bet for $10,000 — approximately three months’ salary for an average American worker. This began the process by which Romney helped to solidify others’ stereotypes about his wealth and social class.

Later in the cycle came the “moustache bet” between David Axelrod and Joe Scarborough. The terms of Scarborough’s loss have now apparently been negotiated: instead of growing the ‘stache, “Morning Joe” will donate $10,000 to a charitable foundation run by Axelrod and his wife in support of epilepsy research (Axelrod’s daughter has epilepsy). It’s not clear if the 10K figure was meant to mock the Romney-Perry bet, or if it’s just the number that comes to mind for rich people when gambling.

Scarborough then baited Nate Silver into a $1,000 bet by calling him a “joke” based on his confidence in his data and algorithm. It’s not clear whether the bet went through or if they just donated the money to the Red Cross, as suggested by Scarborough. A key difference here, though, is that Silver articulated a defense of the gambling motif. He thinks that if pundits are going to suck up air time on predictions, they should be willing to put their money where their mouths are.  He has further stated on multiple occasions his fondness for poker (and a history of playing it well), and the very day before the election he said Romney had an inside straight draw:

All of this leaves Mr. Romney drawing to an inside straight. I hope you’ll excuse the cliché, but it’s appropriate here: in poker, making an inside straight requires you to catch one of 4 cards out of 48 remaining in the deck, the chances of which are about 8 percent. Those are now about Mr. Romney’s chances of winning the Electoral College, according to the FiveThirtyEight forecast.

As any poker player knows, those 8 percent chances do come up once in a while. If it happens this year, then a lot of polling firms will have to re-examine their assumptions — and we will have to re-examine ours about how trustworthy the polls are. But the odds are that Mr. Obama will win another term.

The “inside straight” analogy was catchy enough that Brit Hume used it during live analysis of election returns on Fox News. Now, as Silver knows, for truly great players, poker is hardly gambling at all — it’s arithmetic, probability, and self-control over the long run. Or as the poker-whiz Mike McDermott (Matt Damon) screams to his beleaguered girlfriend in the movie Rounders: “Why does this still seem like gambling to you? I mean, why do you think the same five guys make it to the final table of the World Series of Poker EVERY SINGLE YEAR? What? Are they the luckiest guys in Las Vegas?” 

In the market for real-life betting on the election, the political betting sites were also quite accurate. Intrade is the most famous, and it was almost as accurate as Nate Silver (Silver beat the “free market” prediction on Florida). So score one for free-market gambling on politics: it is much better at predicting elections than pundits are.

Where does Karl Rove fit into all this? Was he the biggest bookie in the country? Not really. What he did by aggregating large donations and investing them around the country was legal and wasn’t much like gambling. If Silver was like a poker savant, and Intrade resembled the fingerprints of Adam Smith’s “invisible hand,” Rove’s puppeteering of various PACs and SuperPACs bore more resemblance to the world of high-end fund managers. Karl Rove is now a fabulously famous manager of a disastrous investment fund — one which bets huge, doesn’t diversify, and never hedges. In the end, he lost almost all of his investors’ money, with estimates between 300 and 400 million dollars. The day after the election, he must have felt like Jon Corzine after the $1.2 billion collapse of MF Global. I can imagine Karl Rove facing the super-donors: in the words of Corzine, “I simply don’t know where the money is.”

As Rove learned, one of the easiest places to lose money is in an echo chamber.

One of the super-donors awaiting reports of return on investment is the SuperPACiest of them all: Sheldon Adelson. In what is possibly the grandest irony of the 2012 election cycle, the single worst gambler in the country turned out to be the wealthiest casino magnate. He spent at least $53 million supporting candidates and Super PACs all over the country, and he has only one small victory to show for it — and that was an incumbent defending a seat (Heller, R-NV).

Adelson’s not a poker aficionado, I don’t think. In fact, he’s famous for being “morally opposed” to online poker. I imagine him instead in the sportsbook of a casino, or the off-track betting parlor. Multiple contests, multiple races, not as much skill involved. Go with your gut. He placed a big bet (~$15 million) during the day’s “early game,” but Gingrich lost. It was a tough loss, since the magnitude of Adelson’s bet had single-handedly “moved the line” on the game, even making Gingrich look like a favorite for a while to oddsmakers. He then needed to recoup some losses, so he bet on the team that defeated his early bet — that must be a sure thing! He also threw out some smaller bets on underdogs (Boteach, NJ) and old veterans (Allen, VA).

But at the end of the long night, there were no more bets to be made. The season is over. After this weary gambler left the casino, the night air likely offered no comfort. At least when you get fleeced in Vegas, you walk out to the warm and vibrant “strip.” But Boston is cold in November, and the fireworks planned to go off over Boston Harbor were never lit.

This season’s gambling is over, but you can bet Adelson will be back next season. After all, his loss of over $53 million may sound like a lot to you and me, but it’s only 0.25% of his wealth. His loss at the election casino was quantitatively big, but it was as if an average American household lost about 250 dollars. Enough to produce a hangover, for sure, but not enough to keep the gambler from coming back.