My man Rudy Giuliani got smoked in the Republican Iowa caucuses: 4% of the vote, nowhere.Yet as the smoke clears, it’s going to become apparent that Rudy was the night’s big winner. Here’s why.

The actual Republican winner, Mike Huckabee, cannot win his party’s nomination. Huckabee’s strong social conservatism played well in Iowa, where 60% of Republicans say they attend church every week.Outside Iowa, Huckabee will encounter a much less churchy party. Economic conservatives are dismayed by Huckabee’s record as governor of Arkansas: the fifth worst in the nation according to the libertarian Cato Institute.

Security voters worry about Huckabee’s frequent stumbles in foreign affairs. Huckabee’s immediate reaction to the Bhutto assassination was to call for American “apologies” to the people of Pakistan. His campaign later embarrassedly explained that he had meant to convey only “condolences” — not to imply that the United States was somehow culpable in the killing.The race now moves to New Hampshire, where a majority of Republicans want abortion to remain legal. Huckabee will do well to finish fourth in the Granite State.

If Huckabee’s Iowa win did him little enduring good, former Massachusetts governor Mitt Romney’s Iowa defeat does him severe and probably irrecoverable harm.Romney staked his entire campaign on a big Iowa win. He repositioned himself on the issues to appeal to Iowa’s social conservatives. He spent lavishly: at least $7 million, as compared to Huckabee’s $1.4 million. And yet Romney was crushed by Huckabee, 34%-25%.

Badly damaged, Romney now proceeds to New Hampshire. New Hampshire adjoins Massachusetts. These are Romney’s neighbors, practically his constituents. If he cannot win there, he cannot win anywhere. And Romney is running an average of two points behind John McCain.

So is it then McCain who triumphed in Iowa? That’s certainly the impression you would get from the national media, who adore the maverick war hero. McCain won the New Hampshire primary in 2000, and he will probably win again in 2008. His quirky independent politics suit a state whose license plates urge: “Life Free or Die.”Yet McCain faces severe constraints outside New Hampshire. He still polls at less than 20% among Republicans nationwide. Many Republicans remember that McCain nearly accepted the Democratic vice presidential nomination in 2004. Despite McCain’s strong pro-life record, the National Right to Life Committee endorsed Fred Thompson for 2008.

Above all, Republicans remember McCain’s authorship of the detested McCain-Kennedy immigration amnesty — and McCain’s harsh condemnation of those conservatives who opposed him. 28% of Republicans rate immigration as the top issue, more than any other. For these Republicans, McCain is on the wrong side.Nor can McCain realistically hope to get any momentum out of New Hampshire. In the next primary (Michigan, Jan. 15) he polls a distant third. He ranks fourth in the primary after that (South Carolina, Jan. 19). And because McCain’s campaign is broke, he will have difficulty competing in the big, expensive media-market states that vote after January 29.

So who does that leave? Not Fred Thompson. He finished a dismal third in Iowa — and his aides are already telling journalists he will soon quit the race. No, it leaves Rudy. Rudy’s campaign has gone badly in recent weeks. He dropped 10 points among Republicans in early December, damaged by allegations that he had improperly billed city agencies for security costs on visits to his future wife. The allegations have since been disproven and retracted, but the mayor’s standing has not yet recovered.

Still, Giuliani continues to poll first among Republicans nationwide. Republicans rate him the most electable of the candidates. He and McCain are the only two candidates who beat Hillary or Obama in head-to-head poll match-ups. Rudy is the most popular Republican in New Jersey, a must-win state for the GOP in 2008.

With Thompson sunk or sinking, with Romney faltering and listing, it is Rudy who has the best chance to position himself as a viable alternative to the unelectable Huckabee. But a chance is all he has, not a certainty.Giuliani faces one severe obstacle to the nomination: He is pro-choice in a pro-life party. He cannot afford a second obstacle. Giuliani has to move now to align himself with the Republican voting majority on the immigration-reform issue. Immigration is a huge concern for Republicans in South Carolina — and given Huckabee’s dismal record on illegal immigration, the issue offers Giuliani a chance to do well in what might otherwise look like a natural Huckabee state.

If Giuliani can beat the odds in South Carolina, he will be superbly positioned to start amassing big delegate totals in Florida, California and New Jersey, when those huge states come into play in February.The Clash have a song: Rudie can’t fail. That’s going too far. But after Iowa, no Republican has a better chance to succeed.

David Frum, National Post.