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This has been reported in several places now: CNN is reporting that McCain is making those tough decisions that politicians love to talk about. According to CNN, McCain is abandoning Colorado (9 EVs), Iowa (7 EVs) and New Mexico (5 Evs).
Personally, I like Wonkette's take:
My friends, it looks like the McCain Campaign is pulling out of three states they badly needed: Colorado, New Mexico and Iowa. Instead, they’re pouring whatever they’ve got left into Pennsylvania (Obama +12), Florida (McCain +1), Virgina (Obama +10 or +6), North Carolina (Obama +7 or +3), Ohio (even), and Nevada with its suddenly crucial five electoral votes. Nevada barely went to Bush Junior in 2000 and 2004 but is now tipping to Obama.
It is pretty remarkable how many important states McCain has surrendered. Why are they announcing this stuff?
My take: I think it's a smoke screen, tortoise-and-the-hare strategy to lull progressives into complacency and/or a false sense of security. I don't believe they are fulling pulling out - at least not out of Colorado. On the professional side, I've actually heard that conservative money is pouring in to Colorado. So if they are pulling out, it is probably because an independent expenditure group or a 527 committee is dumping money in (hello NRA).