Branstad has never endorsed a candidate for his states' caucuses. So his surprising denunciation of Ted Cruz may alter the race in the final 12 days before the voting begins.

Iowa Governor Terry Branstad is the most powerful politician in the state. He is the longest serving governor in the history of the United States, having first been elected in 1982, serving until 1999, then running again and winning in 2010.

Branstad is a big booster of ethanol subsidies. Cruz wants them phased out over a five-year period. The clash is more than philosophical, as both men think they are standing on principle. Rather, it is the latest schism between the GOP establishment and a rebel movement now clearly led by Ted Cruz that looks to alter the power dynamic in Washington to favor strong conservatives.

CNN:

Speaking to a small group of reporters at the Iowa Renewable Fuels Summit in Altoona, where several 2016 presidential candidates are slated to speak, Branstad labeled Cruz a "big oil" candidate whose victory would be "very damaging to our state." "It would be a big mistake for Iowa to support him," Branstad said. "And I know he's ahead in the polls but the only poll that counts is the one they take on caucus night and I think that could change between now and then." Asked by a reporter whether he wants to see Cruz defeated, Branstad answered: "Yes." Branstad's attack on Cruz is an extraordinary intervention in the caucus campaign. The state's caucuses take place on February 1. "I don't think it's a foregone conclusion that Ted Cruz is going to win this state," Branstad told CNN afterwards. "Because as Iowans learn about his anti-renewable fuel stand, and that it will cost us jobs, and will further reduce farm income, I think people will realize that it's not in our interest." He added: "I don't think that Ted Cruz is the right one for Iowans to support in the caucus."

Branstad enjoys the support of 75% of Republicans in the state and has a political network without equal that will now, presumably, work to defeat Cruz.

Cruz immediately went on the attack.

Politico:

“It is no surprise that the establishment is in full panic mode,” Cruz told reporters here. “We said from the beginning, that the Washington cartel was going to panic more and more. As conservatives unite behind our campaign you’re going to see the Washington cartel firing every shot they can, every cannon they can. Because the Washington cartel lives on cronyism, it lives on making deals, it lives on picking winners and losers and supporting corporate welfare and cronyism. This is what people are so fed up with.” He added, “We will see, like ‘The Empire Strikes Back,’ the establishment will strike back because they don’t want an end to cronyism and the gravy train from Washington.”

Branstad partisans hit back almost immediately, suggesting that Cruz was bashing Iowa farmers. Cruz insisted he was doing no such thing.

“I’m saying Iowa corn farmers are wonderful Americans, but Iowa corn farmers are not career politicians,” he said, taking another poke at Branstad. “Iowa corn farmers are frustrated with career politicians. They’re fed up with politicians who make deals every day to grow government, to expand the debt.”

Lately, the polls have been back and forth between Trump and Cruz. But the twin body blows yesterday of Palin's endorsement of Trump and Branstad's searing attack could make the caucuses Trump's to lose.