Editor's note: Starting Sept. 28, Ahead of the Curve will run on Tuesdays.

The mid-term elections coming up in November might be as momentous for markets as the presidential election in 2008. Two years ago it was all about "change." That's what it's about now, too. Or more accurately, it's about "changing the change." For markets that means uncertainty.

The Republicans seem destined now to take over the House of Representatives, and it's not impossible they'll take the Senate, too. For what seems like a sure thing, that carries lot of uncertainty. We don't know how strong their majorities will be. We don't know President Obama will react -- cooperate or fight? And worst of all, we don't really know what the potential new Republican majority really believes about economic policy.

As of yesterday, we have a little telemetry about what the incoming crop of Republicans believe, in the form of the "Pledge to America" -- what amounts to the party's mid-term platform. It's just a bunch of platitudes and campaign promises but nevertheless potentially revealing, and it's really all we have to go on. After all, the GOP has spent most of the last two years as a minority party. All they've really had to do was object to everything Obama and the Democrats wanted to do. Now it gets interesting: they have to actually have some ideas. Will they be good ones, or bad ones? Nobody knows.

As a general matter, I think Republicans tend to have better economic policy instincts than Democrats. Markets unambiguously agree. Historically, the stock market has performed vastly better, on average, under Republican Congresses than Democratic ones -- even when the president was a Democrat too.

But I have my doubts and fears. Nothing would be better for the economy than to shrink the bloated, expensive and intrusive federal government, and let private economic actors do their thing without so much interference and taxation. On that point Republicans tend to talk a good game, but the size and cost of government grew vastly under the presidency of George W. Bush, who had a Republican Congress on his side for six of his eight years.

Then there are the Republicans who don't really want to shrink government -- they just want to shrink the deficit and the debt. For them, raising taxes is a perfectly acceptable solution. That just imposes more burdens on people, and doesn t necessarily reduce the role of government. I don't know how their view is really all that different than the Democrats'. It's just two versions of tax-and-spend.

But then there are a few Republicans, like Wisconsin representative Paul Ryan, who consistently speak out for sensible pro-growth policies -- keeping taxes low, shrinking government, trimming the future costs of today's spending, and gradually working down the debt.

If the GOP takes Congress, which Republicans will we get? Let's take a look at their Pledge to America point by point, and see how we think the economy and the markets would respond if the GOP actually followed through.

You can download the pledge yourself. You'll have to wade through a lot of highfalutin patriotic rhetoric, useless pictures of the Statue of Liberty and Mount Rushmore, and the obligatory snapshots of ordinary Americans living ordinary American lives to finally get to the actual policy prescriptions. So let me summarize for you.

The first major part of the Pledge is where the big economic impacts are. They call it a "Plan to Create Jobs."

Bad start. Aren't conservatives supposed to know that government can't "create jobs" -- except for government jobs? Actually, they do. When you read further, what is offered is "to create incentives for job growth." Now we're talking. That's something government can do.

How to do it? First, extend today's low tax rates. Good start. Couldn't agree more. If the GOP could pull this off, at minimum it would avoid the double-dip recession that is virtually inevitable if the low rates expire. If the low rates on dividends and capital gains are made permanent as the GOP says it wants, that should quickly add at least 10% to the value of the stock market.

Second, "allow small business owners to take a tax deduction equal to 20 percent of their business income." Sigh I never met a tax cut I didn't like, but why single out one particular constituency for the favor? Is small business inherently better than big business? That s the kind of economic fine-tuning that the GOP should leave to the Democrats who think that government should make all the decisions. I see this one as market-neutral.

Third, "require congressional approval of any new federal regulation that has an annual cost to our economy of $100 million or more." Nice idea. I'm not sure what would prevent a government agency from breaking a $100 million regulation into ten $10 million regulations, and evading this rule. So, better to freeze regulation entirely. But this is a start. Regulation is a deadweight loss to corporate earnings -- stocks should go up on this.

Fourth, repeal the mandate hidden in Obama's health care legislation that requires small business to report to the IRS all purchases above $600. Bravo. It boggles my mind that Democrats, who so loathe the privacy invasions implicit in the Patriot Act, would have ever approve this kind of Big Brother regulation in the first place. In and of itself, this will have no effect on earnings. But it would send a signal that would be very positive for stocks -- that not only will this kind of burden not be imposed on business, but that old burdens will be removed.

Indeed, elsewhere in the Pledge there is a call to replace Obamacare with several initiatives to help make health care more efficient and affordable. I don't want to get into a point-by-point review, but if you believe that markets make better decisions than governments -- and if you are terrified by the gigantic tax increases that will hit in 2014 thanks to Obamacare -- then you'd have to see this proposition as friendly to the economy and to markets.

Is this exactly the pledge I would have written for the GOP? No. But if they actually implement the items I've listed above, there is not the slightest doubt in my mind that the economy would improve, and the stock market improve even more.

But first they have to win, an iffy proposition at best. Then they have to follow through on their Pledge -- politicians are not good at this. Oh -- and then Obama, who will be there for another two years, will have to go along with it. Fat chance.

Sounds to me like a formula for more slow growth and stagnant markets. I suppose it could be worse.