What does midterm mean for Obama administration?
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Domestic policy implications
What can we expect after the midterms? Will Obama modify his priorities and change governing style as Clinton did after 1994?
"When there was a large Democratic majority, he (Obama) was able to focus on big priorities, long-term priorities such as healthcare bill, which he will not be able to do now," said Fortier. "He will have to be focused on smaller issues, issues Republicans might support."
In terms of domestic policy, the Obama administration will definitely pay more attention to economy-related issues, as the midterms have shown that Democratic losses were largely a result of people's strong dissatisfaction with the economy.
The most likely areas for the parties to reach compromise might include tax cuts and unemployment benefits, as a failure to do so will deal a blow to ordinary Americans who are still struggling to recover from the worst recession since the 1930s.
Another priority for the Obama administration in the next two years is to defend his legislative accomplishments, most notably the healthcare and the Wall Street reform laws.
Republicans vowed to repeal the healthcare law, something most analysts see unlikely considering Democrats still hold the Senate and the president has the veto power. But they might put up for vote the individual mandate or pieces of healthcare reform that are extremely unpopular.
Comprehensive immigration and energy reforms are getting more difficult, if not impossible, under the new Congress.
"To the extent that there is some work on immigration, it probably will be just some relatively small additional border security measure," said Fortier. "And if there's work on cap-and-trade, I know the Administration was trying to sort of step back and do something more energy related."
Foreign policy implications
Few Americans cast their ballot in November on the basis of foreign policy, but it does not mean the results will not affect U.S. foreign policy.
Under the U.S. Constitution, the president has most of the initiative on foreign policy and defense, but Congress has the authority to declare war, approve spending, ratify treaties, among others. With a strengthened Republican party in Congress, the Obama administration will face more constraints in implementing foreign policy.
"One relationship sure to be influenced by Republican gains will be that between the U.S. and Russia," said Richard Haass, president of the Council on Foreign Relations. "Quick or easy Senate approval of the New START arms-control treaty is highly unlikely, given stated concerns about verification and the protection of U.S. missile-defense programs."
Republican gains in the midterm elections will also affect Obama's strategy in Afghanistan. While most Republicans support the war, many criticize the president's July 2011 drawdown date for U.S. troops.
In Middle East, Republicans are expected to argue for putting less pressure on Israel to compromise with Palestinians and more pressure on Iran to give up its nuclear capabilities.
A Congress with more Republicans may also mean higher chances of approving bilateral free-trade agreements. U.S. trade agreements with South Korea, Panama and Colombia have been languishing for years, mostly because of opposition to free trade from labor union and the Democratic Party. Republicans have historically been more supportive of free trade.
"The president tends to spend more time on foreign policy when it's harder for him to get things done through Congress," said Fortier. "But at the same time, he wants to focus on domestic concerns, so he is going to be pulled in both direction."
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