Democrats have won a narrow majority in the United States Senate after Republican senator George Allen conceded defeat in Virginia, giving the party control of both chambers of Congress for the first time in 12 years, writes Denis Staunton in Washington.
Mr Allen said last night he was forgoing his right to a recount in Virginia's tight contest because he believed Democrat Jim Webb's lead was unassailable.
"The people of Virginia have spoken and I respect their decision," Mr Allen told supporters.
The Democratic victory in the Senate gives the party a veto on President George Bush's future appointments, including those to the Supreme Court, effectively halting Mr Bush's drive to create a conservative majority in the court.
Control of both houses of Congress will strengthen the Democrats' hand in conducting investigations into the actions of the Bush administration, including the preparation and conduct of the Iraq war, and gives the party more control over the federal budget.
Mr Bush yesterday met Democratic House of Representatives leaders at the White House and promised he would work with them "in a constructive way" over the next two years.
"We won't agree on every issue, but we do agree that we love America equally, that we're concerned about the future of this country, and that we will do our very best to address big problems," he said.
California congresswoman Nancy Pelosi, who is set to become speaker of the House, said both sides were ready to put the bitterness of the election campaign behind them. "Democrats are not about getting even. Democrats are about helping the American people to get ahead," she said.
The Virginia contest was the last undecided Senate race in the country, and Mr Webb's victory tipped the scales, giving the Democrats control of 51 Senate seats. Mr Allen was comfortably ahead in polls until August, when he mockingly referred to a Webb campaign volunteer of Indian descent as "Macaca", regarded by some as a racial slur.
The Senate majority seals a sweeping victory for Democrats in the mid-term elections, although the final tally of House seats will not be clear for some days. Democrats have promised to increase the minimum wage, introduce universal healthcare for children and to put pressure on the White House to change course in Iraq.
Outgoing defence secretary Donald Rumsfeld, who has become the first administration casualty of the Democratic victory, yesterday acknowledged that the Iraq war has been going badly.
"I will say this - it is very clear that the major combat operations were an enormous success. It's clear that in phase two of this, it has not been going well enough or fast enough," he told students at Kansas State University.
He declined to offer any advice to former CIA director Robert Gates, his nominated successor, and avoided making any assessment of his own performance as defence secretary. "I'd let history worry about that," he said.
Nevada's Harry Reid will become Senate majority leader and Dick Durbin of Illinois will be his deputy as prominent Democrats assume the chairmanships of powerful committees.
Senator Edward Kennedy will chair the health, education, labour and pensions committee; Delaware's Joe Biden will be the new chairman of the foreign relations committee; Vermont's Patrick Leahy will chair the judiciary committee; former presidential candidate John Kerry will be chairman of the small business and entrepreneurship committee; Connecticut's Chris Dodd will chair the banking, housing and urban affairs committee; and 88-year-old Robert Byrd will chair the appropriations committee.
The new Congress will not convene until next January and the outgoing Congress will remain in place until then in a "lame-duck session".
Mr Bush said yesterday he wants to use the remaining weeks of the Republican-led Congress to push through a number of measures, including a bill authorising the National Security Agency to listen to phone calls made between the US and other countries.