Updated Nov 4, 2018

1. What to watch: Midterms set stage for 2020

Illustration: Aïda Amer/Axios

Midterms are theoretically local and state elections, but Tuesday's contests add up to a remarkable snapshot of a quickly changing America: more women running than ever ... more Muslim Americans ... more Native Americans ... more veterans ... more teachers ... more millennials ... and more LGBTQ Americans.

With turnout expected to hit record levels, the results will tell us a lot about the type of candidate who matches up best against Trump in 2020.

Here are 6 things we're watching:

  1. Will either party find a way to arrest what The Wall Street Journal calls "The Yawning Divide"? White women with college degrees are turning rapidly Democratic, and white men are moving drastically the other way, "making both essentially unreachable by the opposing candidate."
  2. Will pollsters make a comeback after being stunned in 2016? The WashPost's Philip Bump reminds us that based on polling science, "If we held the election 20 times, in three of those elections, the Republicans would hold their [House] majority. Next Tuesday might be one of those three."
  3. Will young people vote more than in the past, after all the pleas, from the Parkland survivors to "Pod Save America"? The #MarchForOurLives and #RoadToChange activists traveled the country to try to counteract apathy among vote-eligible teens. It'd be a game-changer if they do, but Democratic strategists have their doubts.
  4. How big a swath of that record number of women candidates for House, Senate and governor — spurred by record number of women donors — turn into lawmakers? Many are challengers — always a daunting route. Christina Reynolds of EMILY's List told AP: "[R]egardless of what happens, women have shown that they are no longer happy with other people representing them and speaking for them."
  5. How blue is the wave? Republicans are favored to pick up several Dem open seats in western Pennsylvania and the Iron Range of Minnesota. But will a single Democratic House incumbent lose? Probably not. The Cook Political Report's David Wasserman tells me the nation's most vulnerable House Dem is Rep. Tom O´Halleran in Arizona. But he's still favored to hold his Trump-won seat.
  6. And from Jonathan Swan: If Democrats win control over the House by a slim margin (e.g., 5 to 10 seats), how tight will Nancy Pelosi’s grip be on power? There’ll be a ton of pressure for generational change, and much restlessness beyond those candidates who’ve already publicly said they won’t vote for Pelosi as Speaker. On her side: Pelosi is the perfect person to keep a rowdy House on track to investigate the heck out of the Trump administration. 

Be smart ... On Wednesday morning, we'll wake up with the next two to six years foretold:

  • Trump: triumphant or cornered?
  • Democrats: ascendant or humiliated?

Either way, we face a 2020 political season that will make this one seem civil.

Go deeper

HBCUs are missing from the discussion on venture capital's diversity

Illustration: Eniola Odetunde/Axios

Venture capital is beginning a belated conversation about its dearth of black investors and support of black founders, but hasn't yet turned its attention to the trivial participation of historically black colleges and universities (HBCUs) as limited partners in funds.

Why it matters: This increases educational and economic inequality, as the vast majority of VC profits go to limited partners.

Unemployment rate falls to 13.3% in May

Data: Bureau of Labor Statistics; Chart: Axios Visuals

The U.S. unemployment rate fell to 13.3% in May, with 2.5 million jobs gained, the government said on Friday.

Why it matters: The far better-than-expected numbers show a surprising improvement in the job market, which has been devastated by the coronavirus pandemic.

The difficulty of calculating the real unemployment rate

Data: U.S. Department of Labor; Note: Initial traditional state claims from the weeks of May 23 and 30, continuing traditional claims from May 23. Initial PUA claims from May 16, 23, and 30, continuing PUA and other programs from May 16; Chart: Andrew Witherspoon/Axios

The shocking May jobs report — with a decline in the unemployment rate to 13.3% and more than 2 million jobs added — destroyed expectations of a much worse economic picture.

Why it matters: Traditional economic reports have failed to keep up with the devastation of the coronavirus pandemic and have made it nearly impossible for researchers to determine the state of the U.S. labor market or the economy.