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UPDATE: At 2:30 am ET, the Iowa GOP congratulated Romney as the winner of the Iowa caucus by 8 votes. Iowa officials previously confirmed at 2 am ET that Santorum’s lead had dropped to 4 votes due to undercounted votes for Romney earlier in the evening.

Defying all expectations, former Sen. Rick Santorum (R-PA) ended the Iowa caucuses near the head of the GOP primary pack, leading former governor Mitt Romney (R-MA) by a mere 18 votes with 99 percent of precincts reporting at 1:10 am ET.

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Santorum took the stage to address supporters just after midnight on January 4, despite only a 118-vote margin in his favor when he took the stage and the unwillingness of any news organization to declare him the victor with 96 percent of precincts reporting. By the time he finished thanking his wife and the state of Iowa, he was 62 votes down.

During his speech, noting that he’d begun his campaign in Somerset County, PA — the place his grandfather went to escape Mussolini’s fascism, in an apparent reference to Obama which he later made explicit. “One [party] wants to talk about raising taxes on people who have been successful and redistributing money, increasing dependency in this country, promoting more Medicaid and food stamps, and food stamps and all sorts of social welfare programs, and passing Obamacare, to provide even more government subsidies. More and more dependency, more and more government. Exactly what my grandfather left in 1925.”

Santorum then ran through his various economic proposals, including his proposal to encourage marriage to improve living standards and his proposals to shore up the manufacturing base by eliminating corporate taxes on manufacturers and all regulations that cost manufacturers more than $100 million dollars, regardless of their intent. He also hit people who suggest that Republicans should vote Romney because he’s more likely to be able to beat Obama, “What wins in America are bold ideas, sharp contrasts, and a plan that includes everyone.”

Near the end of his speech, as only fitting for a candidate who promotes his pro-life positions as every turn, he turned at the end of his speech to abortion and the “sanctity of life,” pointing to his 3-year-old disabled daughter whose disability was expected to end her life after a year, as an implicit reason not to allow abortion. By the end of his speech, Santorum was 5 votes up with 99 percent of precincts reporting.

Romney, introduced by his wife Ann as “the next president of the United States” and flanked by his sons, took the stage last and congratulated Santorum on his “victory,” even as he noted that the vote tallies were not yet in. “This is a campaign night when America wins,” he said. He noted that, in contrast to his 2008 campaign when he had 52 staffers, he only had 5 paid staffers in Iowa with all the work done by volunteers.

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Like many of the candidates before him, Romney went after the President, “who may be a nice guy but who is just over his head,” pointing specifically to President Obama’s “policy of engagement” with regards to Iran and his inability to keep unemployment under 8 percent as he first promised. As with Santorum, he promised to lower corporate tax rates and discourage regulations, adding that he intended on opening up markets to American goods and pursue more drilling.

“But this election is bigger even than jobs and a strong economy, it’s bigger than a budget that’s balances and deficits and debt that begin to be reduced,” he said, “It’s really an election about the soul of America.” He went on to discuss the need to “remain a merit society, an opportunity nation” where people can lift themselves up on the basis of their education and entrepreneurship, rather than a society that attempts to given those without either an implicit hand-out.

Despite polls as late as last week showing him in the lead and running neck-and-neck with the two top candidates throughout the nights and in entrance polls, Rep. Ron Paul (R-TX) placed third. He took the stage to address his supporters around 11 pm ET, shortly after the networks released their projections, to thank his supporters, his campaign staff and his wife. He repeated throughout his speech that his supporters “believe in something,” drawing an implicit contrast between his campaign and those of Romney and newly-annointed fellow front-runner Santorum. He emphasized that his campaign had introduced to the race themes of economic and personal rights, the importance of the Constitution, and the movement to end the war in Afghanistan, and that it would continue.

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Although speaking to a relatively muted crowd, especially by Paul supporters’ standards, Paul did get attendees to boo economist John Maynard Keynes, a bête noir of the fiscal conservative movement, but they applauded the supporter who Paul quoted: “I’m waiting for the day when I can say, ‘We’re all Austrians now!'”, a reference to the Austrian school of economic theory. Before the cameras cut out, Paul introduced U.S. Army CPL Jesse Thorsen, wearing his uniform, to the crowd to explain his support of Paul’s foreign policy agenda. Wearing one’s uniform while participating in political activities, like endorsing a candidate or speaking at an event, is a violation of the U.S. Code of Military Justice under DOD Directive 1344.10

Former House Speaker Newt Gingrich (R-GA) took 4th place in the caucus, though he took the stage to concede the race after Paul. He promised not to run negative ads but said, “I reserve the right to tell the truth, and if the truth seems negative, that may be more of a comment on his record than it is on politics.” He promised, despite his 4th place finish, to continue on in the race and said, “I am convinced that the Republican party will pick and heir of Reagan, a committed conservative and a track record of changing Washington.”

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Sixth place finisher Rep. Michele Bachmann (R-MN), who declared herself “not a politician” took the stage to promise her supporters that Obama will be a “one-term President.” In a rambling speech, she then talked about her well-known positions on the issues, slammed the media narrative on her campaign and touted her ability to organized a community of like-minded people against the Obama health care reform plan. In a portion reminiscent of former Alaska governor Sarah Palin’s (R-AK) rhetorical style, she explained why her candidacy was so important: “What we need is a fearless conservative, one with no compromises on their record, on spending, on health care, on crony capitalism, on defending America, on standing with our ally Israel, on securing our border from illegal immigrants or on defending innocent unborn life or protecting marriage between one man and one woman, if anyone’s confused, so we can defeat Barack Obama and his failed Socialist policies.”

Governor Rick Perry (R-TX), initially expected to be a front-runner in Iowa, placed fifth and took the stage to address his supporters at almost midnight ET as the rest of the country waited to see whether Santorum was really going to stay atop Romney. Bizarrely, he began his speech by reading a “rambling” letter from a young supporter in full to the crowd, after which he thanked all of his supporters for their help as well. He admitted that he didn’t think being President “was [his] purpose in life” but that he got into the race because “America is in trouble” because its debt and the number of Americans on food stamps and unemployed who “don’t see a Washington that’s willing to make hard decisions to help get, to get them back on their feet again.” Though he didn’t yet leave the race, he did say, “With the voters’ decision tonight in Iowa, I’ve decided to return to Texas, assess the results of tonight’s caucus, determine whether there is a path forward for myself in this race.”

The New Hampshire primary is next week, giving Santorum little time to capitalize on his unexpected surge in Iowa and Romney the home field advantage.

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[Additional reporting by Rafael Noboa y Rivera]

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