The 2008 presidential race is under way in earnest, and the signs – particularly those coming out of Thursday’s Iowa caucuses – are encouraging that the contest will be lively, surprising, engaging and will draw in previously dormant voters.

The results of the Iowa contest are as bracing as that state’s cold prairie winds. Former first lady and New York Sen. Hillary Clinton, who cast herself as the nominee-in-waiting throughout the fall, is suddenly an also-ran, finishing third behind Illinois Sen. Barack Obama and former South Carolina Sen. John Edwards. Sen. Clinton has the money and organization to continue through the next several primaries and caucuses, which is good for the process. If she does eventually win the nomination, she will be a better, and more transparent candidate for having to more clearly define herself to voters.

On the Republican side, former New York Mayor Rudy Giuliani, the one-time leader in national GOP polls, managed a paltry 3 percent of support in Iowa. He did not campaign heavily in the state, but if Mayor Giuliani expects to win the national election, he should have seen a more substantial baseline of approval. The response of Iowa Republicans, of whom 60 percent identify as evangelical Christians, to Mayor Giuliani, who supports abortion and gay rights, may indicate the fast-talking New Yorker does not play well in the heartland.

Former Massachusetts Gov. Mitt Romney, whom many believed would walk away with wins in Iowa and New Hampshire, also is suddenly deflated, coming in second by 9 percentage points to former Arkansas Gov. Mike Huckabee. Gov. Romney outspent Gov. Huckabee by a 20-1 ratio in Iowa, which casts doubt on Gov. Romney’s ability to close the deal with voters. But as with Sen. Clinton, both Gov. Romney and Mayor Giuliani are in the race for the long haul, and should either emerge as the nominee, they will be better candidates for having faced these reversals of fortune.

Especially cheering to observers of the political process was that both parties drew unexpected numbers of participants to their caucuses in Iowa. Both Gov. Huckabee and Sen. Obama are perceived as idealistic Washington outsiders with fresh ideas and approaches to governing. Both have campaigned differently than their opponents, avoiding, for the most part, attack ads and swipes at rivals. That may explain the enthusiasm with which they are being embraced. Historically, that blush of infatuation fades – remember Howard Dean in 2004, and John McCain in 2000? – but both Gov. Huckabee and Sen. Obama already have left their marks on the race.

Iowa created the first casualties as well; Delaware Sen. Joe Biden and Connecticut Sen. Chris Dodd have dropped out.

With 25 more electoral contests in the next 30 days, expect more drama.