The news is superfically very bad for Senator John McCain. This weekend he announced he would be below fundraising expectations and could well have less than the $35 to $40 million in campaign funds that pundits expected he would raise in the first quarter of 2007. At the same time, his national poll numbers continue to erode as Michael Barone has shown in a post on his own blog on U.S. News & World Report. The Real clear politics average shows that at this point former New York Mayor Rudy Guiliani has better than a double digit lead among likely Republican primary voters–a lead that has been steadily growing over the last three to four months.

At the same time, the news is not all bad for the Arizona Senator–who I called the frontrunner on the GOP side in my new book The Power of the Vote. The polling of Iowa caucus goers and New Hampshire primary voters shows that McCain is within striking distance of Guiliani as they appear to be in a statistical tie in both states.

Moreover, current polls show that Republican primary voters nationally say that they know very little about the New York Mayor–particularly his stand on key social issues like abortion, guns, and stem cell research. And there is some evidence that they will defect from his candidacy one they learn his positions on these typically key issues in Republican primary contests where self described conservative voters usually form a majority of those casting ballots. Further, it remains to be seen what impact, if any, the various news reports about Guiliani’s family, his and his current wife’s three marriages, will have on a segment of the electorate that places a high values on traditional family values.

But Guiliani’s weakness does not necessarily mean good news for Senator McCain. The results of the recently completed Ohio straw poll in Summit County show a significant amount of spontaneous support for former Tennessee Senator Fred Thompson who finished a strong third behind Guiliani and McCain. Thompson has only done one national interview about a prospective candidacy and already the national polls as well as this straw poll, show that his entry into the race could shake things up fundamentally.

This is not to count out either former Massachusetts Governor Mitt Romney–who should raise around $20 million this quarter–or former House Speaker Newt Gingrich. At the same time, Thompson has none of the political baggage Gingrich would bring to the race nor the issue of political flip flops on the key issues of abortion and stem cell research that Romney has already begun to face.