Ed touched on this earlier, I know, but it deserves a post of its own. Man, if the “boring” candidate in the race is willing to be this bold in front of the hometown crowd, I can’t imagine what the “exciting” candidates will do.

The early read on this move is that it’s a smart play for him politically. I agree with that — from a macro standpoint. But there are people who will tell you that Pawlenty has no chance if he doesn’t finish strong in Iowa, in which case … is his campaign now DOA?

Pawlenty is, in theory, strongly positioned in Iowa. He’s from a neighboring state, he’s been working it on the ground, and as an evangelical, he has the right profile to appeal to social conservatives there. “He has real credibility on the social issues and a faith testimony that will resonate among the grassroots,” a prominent social conservative says.

Yet there’s potential trouble on the launching pad. Rep. Michele Bachmann is also from Minnesota and has a strong bond with social conservatives and tea-party backers. Her fundraising machine, even before it’s ginned up during a presidential run, is formidable. If she gets in, she could easily steal Pawlenty’s thunder in Iowa and deal a severe blow to his candidacy.

A Republican donor who supports Mitt Romney puts the most dire spin on it: “There is no plausible path to the GOP nomination for Pawlenty absent a win in Iowa. Thus, Bachmann poses an existential threat to T-Paw.”

I can picture three scenarios where T-Paw wins the nomination after losing Iowa. One: If Palin or some other grassroots candidate with a real chance to win the nomination jumps in and takes the state by storm, the GOP establishment will panic and might rally behind Pawlenty before New Hampshire on the assumption that only he has a chance of beating the Iowa winner in South Carolina. Two: If Pawlenty earns the endorsements of enough prominent establishment conservatives — Mitch Daniels, Haley Barbour, Jeb Bush, etc — it could boost his profile to the point where he comes back to win indie-minded New Hampshire no matter what happens in Iowa. (Given Romney’s huge fundraising advantage, T-Paw might not be viable without those endorsements anyway.) Three: Huckabee could endorse him before Iowa, which might lock up enough social conservative votes to undo any damage from his ethanol heresy. All of those scenarios are dodgy, though; he’s taking a huge risk, needless to say, by giving a hard dose of fiscal reality to a crucial state he’s actually well positioned to win, especially now that Huck’s out. Ace is right that if Pawlenty goes on to lose the caucuses, he can now spin the defeat not as a case of him underperforming but of having been punished for being a truth-teller. But that’ll be a cold comfort when he then has to move on to New Hampshire to face Romney, who’ll have spent a ton of money there, and Huntsman, who’ll probably be camped out there for the better part of the next eight months.

That said, like most of you (I assume), I respect him more today than I did yesterday, which of course was the whole point of this move. T-Paw’s macro strategy here is straightforward: He needs to balance his appeal to the center as an electable, non-bombthrowing Republican with his appeal to the base as a conservative who’ll stand fast for core principles as president. His argument on the first part of that was already solid — Huntsman is too far to the center to win the nomination, in all likelihood, and Romney has all sorts of baggage that could keep too many base voters home in the general election. His argument on the second part is weaker, especially if a grassroots favorite like Palin jumps in. Forced to choose between someone like T-Paw who seems more electable but less confrontational and someone like Palin who’s perceived as the opposite, many base voters will opt for the latter on the theory that they’d rather stick with someone whom they know will fight for principle and let the electoral chips fall where they may. Pawlenty’s ethanol gambit forces them to rethink that by posing the following question: If he’s willing to confront Iowa voters about their little ethanol gravy train in the name of fiscal responsibility — even though his candidacy probably depends on winning the state — then who wouldn’t he be willing to confront? He’s got guts. I’m not so sure about his risk-assessment skills, but he’s playing to win. Click the image to watch.