I am very confident however of course there is always a chance a miracle could happen
Right... that's why odds exist.
Hitch assumes that he's got a <25% chance of losing money on his bet, hence he offers 3:1 odds (when internally he thinks Hillary has a >75% chance of winning the election, so the expected value for him is still positive).
Let's assume that you believe the Republican field has, say, a 55% chance of winning. And that you bet $5.
In 55% of cases, Hitch is going to lose and owe you $15 (3 * $5).
In 45% of cases, Hitch is going to win and you owe him $5.
Your expected value is (.55)($15) - (.45)(%5) = $7.85.
But you go even further than that- you think it would take "a miracle" for the Republicans to not pull this election.
Let's be super-conservative here and say that a "miracle" happens 1/4 of the time.
That means- in 75% of cases, Hitch is going to lose and owe you $15; in 25% of cases, Hitch is going to win and you lose your $5. If you run this bet an infinite number of times, you should expect to come out $10 ahead on average for each iteration.
You can expect to come out on top under any model where the Republicans' chance of victory is >25%.
The risk is exactly how bets work
. You can't argue that the mere existence of risk makes a bet not worth taking, because it's already handled by the lopsided ratio of wagers.
Edited 2/1/2016 01:01:12