A voter casts a ballot in front of an American flag as other wait in line at a polling station in Purcellville, Virginia, U.S. (Photographer: Andrew Harrer/Bloomberg)

Midterms Speed Read: All You Need to Know About Tuesday’s Vote

(Bloomberg) -- The 2018 midterms are the most closely watched, most expensive and most fretted-about congressional elections in memory. They’re always about the one person not on the ballot -- the president -- but never more so than this year.

Democrats are expected to take control of the House of Representatives but fall short in the Senate. Then again, Democratic candidate Hillary Clinton was expected to beat Donald Trump in 2016. The party’s despair over a second loss to Trump would be immeasurable.

With the campaign entering its final hours, here’s the state of play:

1. Political pros expect. . .

  • Democrats to take the House. They need to flip 23 seats. The widely respected Cook Political Report said Monday, “Democrats are substantial favorites for House control and could pick up anywhere from 20 to 40 seats.”
  • Republicans to hold the Senate. They could pad their 51-49 majority with an extra seat or two.
  • Democrats to win big in key governors’ races. Potential wins in Ohio, Florida, Wisconsin and Michigan would be a balm if Democrats lose the House.

2. Yet Democrats are suddenly nervous
  • Mostly this is Trump-related fatalism. They thought 2016 was going to be a good night too but lost to a man most Democrats despise.
  • The numbers don’t help: some polls over the weekend show the Democratic edge shrinking compared to readings in October.

3. If Democrats end one-party government, look for. . .

  • Even worse legislative gridlock.
  • Nancy Pelosi to return as Speaker.
  • A record number of women in Congress.
  • A flurry of investigations and subpoenas. Democrats could re-open a House Russia probe, seek Trump’s tax returns, investigate Trump’s businesses, dig into agencies.
  • One to watch: Representative Maxine Waters of California, who would take over House Financial Services and has promised to do to banks what she said banks did to average Americans in the housing and banking crises: “What I’m going to do to you is fair,” she said recently. “I’m going to do to you what you did to us.”

4. Markets might be OK with a Democratic takeover

  • Investors generally like gridlock in a split decision because it means Democrats won’t be able to roll back tax cuts or reinstate key parts of the Dodd-Frank financial regulations.
  • Markets rewarded Trump, mostly for his tax cut, but now would seem happy to settle for stalemate.
  • Democrats taking House is base case for many and so it wouldn’t swing equities wildly.
  • In fact, stocks may have gotten a lot of their angst out of their system already. The S&P 500 fell 6.9 percent in October, the worst monthly return since September 2011. If stocks are able to keep their cool now it may be because they just finished losing it.
  • Caveat: More Trump tweets mean more volatility as he lashes out at Democrats.

5. Democrats can stymie Trump domestic policy

6. Democrats cannot stymie Trump foreign policy

  • U.S. president has wide latitude to carry out foreign policy unilaterally.
  • Iran sanctions remain.
  • China “trade war” continues eve as Trump seeks deal with Chinese President Xi Jinping at Group of 20 summit later this month.
  • Tariffs continue.
  • Talks with North Korea continue.
  • One exception: Possible bipartisan cooperation in Congress on additional Russia sanctions, as wells as sanctions on Saudi Arabia over the murder of journalist Jamal Khashoggi.

7. Special Counsel Robert Mueller is still out there

  • Mueller has been in a pre-election “blackout.” He’s free to issue new indictments after the midterms.
  • All eyes are on Attorney General Jeff Sessions, who is expected to depart.
  • Scenario one: No change for Mueller: Deputy Attorney General Rod Rosenstein stays on and continues to oversee Mueller.
  • Scenario two: Rosenstein also departs and Mueller has a new boss, who could tighten the reins.
  • Scenario three: Trump moves to shut down the Mueller probe. This is viewed as highly unlikely if Democrats take the House, because it puts Trump in danger of an obstruction of justice probe.

8. The I-word: Impeachment

  • Democratic leaders have pushed back very hard on the notion that they plan to launch impeachment proceedings against Trump, even though they would hold the chamber where a presidential impeachment would start: the House of Representatives.
  • Very few Democratic House candidates talked about it seriously but the volume could increase if Democrats feel emboldened by victory.

9. And what if it is a repeat of 2016?

  • Two years ago, pollsters got it wrong on Hillary Clinton.
  • If Republicans hold on to both chambers, Trump will take all the credit and he would deserve it. The president did 11 rallies in eight states over six days to stir up his voters, leaning on immigration and painting Democrats as coddling law-breakers.
  • Trump unbound: He still would have both houses of Congress, but more than that, would say his unorthodox approach worked. He and his advisers will feel ever freer to “let Trump be Trump.”
  • Democratic despair could not be overstated: Why can’t we stop this guy?
  • Trump gets the government shutdown he’s long wanted over the border wall on Dec. 7

10. Either way, 2020 begins immediately

  • If Democrats take the House and win key governorships: it will mean they had gains in states Trump won in 2016, such as Pennsylvania, Ohio and Florida. The Democratic civil war -- liberals versus moderates -- will continue with hopes they can knock off Trump in 2020.
  • If Democrats lose the House: It will mean Trumpism reigns and that he’s in better shape for re-election. That would be good news for a brawler like Michael Avenatti, bad news for a healer in the mold of New Jersey Senator Cory Booker. “You need a Trump to beat a Trump” is a view held in some Democratic circles and those people’s voices would be very loud if this happens.

©2018 Bloomberg L.P.