Find another prediction market, or another person, willing to make the bet with you at the true (1%, say) odds. Then you buy one and hedge by selling the other. Arbitrage usually requires two different bets.

For instance, if you sell the Intrade prediction, but make a $1 bet at 99:1 odds that Paul will win the Republican nomination (god forbid), you win $3.50 - $1.00 when Paul loses, and $99.00 - $96.50 when he wins.

[Edited to fix math]