Democratic wins on the coasts, Republican victories most everywhere else: That’s takeaway No. 1 from yesterday’s elections for the US Congress and state houses.

Takeaway No. 2: The Republican takeover of the US House of Representatives means extension of favorable tax rates on dividends is now far more likely. In fact, even before the voting there were already clear signs of an emerging compromise to accomplish that.

We may see a rally the next few days for dividend-paying stocks. But remember that markets always buy on rumor and sell on news, so it’s likely much of this favorable outcome has already been priced in. I also urge anyone who hasn’t yet signed the petition at www.DefendMyDividend.org to do so now.

There’s a clear deadline for Congress and the president to resolve tax issues. That’s because not doing so by Jan. 1 will trigger higher withholding rates for almost all working Americans–and likely deal a mighty blow to the still-fragile economic recovery.

Once that’s done, however, prospects for legislation of any kind are cloudy, to say the least. That’s takeaway No. 3.

The Republican-controlled House of Representatives will be considerably more conservative than the current one. The GOP in the Senate, however, will not only be in the minority, but could well be sub-divided if the Tea Party contingent decides to caucus, as some expect.

Then there’s the question of how much either Democrats or Republicans will try to work together with the 2012 presidential election looming. Relations between the Clinton White House and the 1995-96 Republican-controlled Congress were stormy at first but later evolved into a partnership. That produced compromises for a balanced federal budget, welfare reform and telecommunications overhaul.

We could yet see deals in Washington forged on a number of issues, including energy.

That would definitely be the case if economic growth continues to build on itself, as even the staunchest partisans on both sides will be anxious to get credit for improving conditions. As of now, however, investors should assume little or nothing will get done.

That leads to takeaway No. 4, that the surest policy winners are those benefitting from federal inaction. One example is communications. Before the vote, the Federal Communications Commission (FCC) had become increasingly aggressive with its attempts to regulate broadband Internet and wireless communications. After the vote, it stands no chance whatsoever of pushing any supporting legislation through Congress. Meanwhile, the courts have decisively blocked its unilateral actions on a range of issues.

The upshot is that major issues like net neutrality are going to be decided on the industry level, along the lines of the deal between Verizon Communications (NYSE: VZ) and Google (NSDQ: GOOG) reached earlier this year. That’s good news for companies that have languished under a regulatory cloud for much of the past two years.

Takeaway No. 5: Federal legislation to regulate carbon dioxide (CO₂) is deader than ever. But action on the state level is alive and well.

The big blow yesterday was California’s overwhelming rejection of Proposition 23. That was an effort to put the state’s targeted reduction of CO₂ on hold until state unemployment fell from the current 12 percent-plus to less than 6 percent.

Coupled with the victory of Governor-elect Jerry Brown–who has promised to carry on Governor Schwarzenegger’s aggressive renewable energy development plans–that ensures utilities will be able to continue investing in renewable energy, building rate base and earnings. It also ensures the country’s biggest market will remain open for developers.

Renewable energy also scored a big victory in Colorado, thanks to the decisive victory of Democrat John Hickenlooper. Tea Party candidate Tom Tancredo had campaigned against the state’s support of utility spending on efficiency and renewable energy. Hickenlooper’s win ensures it will continue.

Takeaway No. 6 is that a generally favorable regulatory environment across the US just got even more favorable, particularly remarkable considering high levels of unemployment across the country.

Governors appoint state regulators that set utility rates determining return on investment. That makes the race for state houses always critical for utility investors to watch.

Utilities largely avoided becoming the issue in this election season, also quite an accomplishment considering high unemployment across the country. As a result, it’s likely what was already a very positive environment will improve further, particularly in states like Connecticut, Florida, Illinois and Ohio.

I’ll have more on the election’s impact on renewable energy in this Friday’s Utility & Income. And I’ll have a complete wrapup of how the 215 essential service companies I track are affected by the election results in the December issue of Utility Forecaster.

And, finally, here’s takeover No. 7. Don’t get too excited one way or the other about these election results. There are industries whose prospects really are improved or worsened by politics, like utilities and telecom. Politics in general, however, is a lousy basis for an investment strategy.

Just ask the Obama-fearing investors who sat out the torrid bull market that began in March 2009. There’s just too much room for emotion–the worst enemy of every investor–to dictate decisions that should be 100 percent rational.

The key to investing success is the same, no matter who controls the levers of political power. That is to buy good companies trading at bargain prices and let them build wealth for you. And bringing these opportunities to your attention is still my primary goal, just as it was before the election.