Here are the important developments of the night, in ascending order of importance:
1. Joe Sestak beat Arlen Specter in Pennsylvania. I think this makes the Democrats marginally more likely to hold the Senate seat. Toomey is a radical candidate, and Sestak's win strips him of the anti-incumbent sentiment that's his best shot. That's worth more to the democrats than Specter's superior political polish.
2. Democrats will run Jack Conway against Rand Paul. This puts the Kentucky Senate seat in play -- Rand is the favorite but Conway has a shot. I have a pet theory that a politician's name is a major factor -- I'd guess being named "Jack Conway" is worth several points more than being named "Daniel Mongiardo."
3. Democrats won the special election in Pennsylvania, seemingly by a large margin. I'm stunned. This is a district that voted for John McCain over Barack Obama in 2008 -- the only district in America that went for John Kerry in 2004 and flipped to McCain in 2008. It's also a district that Jack Murtha described as too racist to support Obama. It ought to be ground zero for an anti-Democratic backlash. Republicans failed to nationalize this race, and they failed to take advantage of the intensity gap in a special election.
For months, I've been very bearish on the Democrats chances in November. This is a strong data point that Democrats might hold onto the House and perhaps, if the economy picks up steam, potentially hold their losses to the 20-25 seat range.