The silly-season accusations by Frugal Hoosiers of an Obama "smoke and mirror" campaign in Indiana -- a charge which turned out to be completely and totally bogus -- obscures some of the more interesting issues surrounding Obama's decision to contest the Hoosier state. Any damn fool can see both campaigns are paying some attention to Indiana. The question for Obama, given Indiana's history and political temperament, is why? As any competent observer can tell you, the decision is a risky one with the possibility of a substantial investment of resources with no tangible return. To make it pay off, Obama must either make McCain worried enough to spend in Indiana or outright pull off a feat that no Democrat has pulled off since LBJ in 1964 and actually win the state.
Still, as Nate Silver points out in a post at 538, there are some favorable underlying factors which may play to Obama's advantage. Read the whole post for an interesting explanation of the relevant demographics that suggest Indiana might be competitive, but there's a money graph after the jump and some brief analysis.
The essential question then is whether there has been some sort of latent Democratic vote in Indiana that the Democrats simply haven't bothered to fight for. Indiana has generally had one of the lowest turnout rates in the country, which might be a consequence of its early poll closing times, but might also reflect the apathy caused by the lack of attention paid to it. That alone might not be enough to make the state competitive. But when coupled with the fact that the Democratic nominee is a Midwesterner from a neighboring state, that the state's blue-collar economy is really struggling, and that one campaign is invested in the state when the other isn't, you might have the right mix of circumstances necessary to tip the state.
My sense is that Indiana is still a long shot for Obama, though well worth a modest investment given the campaign's largess. That calculation gets reshuffled if Bayh is the VP nominee. My sense is also that Obama will not be able to scare McCain into spending many additional resources in Indiana. McCain will likely be operating from the perspective that if he's going to lose in Indiana, he's going to get toasted nationally anyway, so why bother with outright additional spending. Nevertheless, as the presence of Rob Portman in town yesterday for some stumping on McCain's behalf suggests, Obama's push may leach off some resources that might be usefully deployed elsewhere.