There's been a great deal of discussion over the past few weeks over the miserable state of the the Right, the Republican Party, and conservatism (a Venn diagram is probably in order here to show the relationships and intersections of those three groups). See George Packer, Fred Thompson, James Joyner, Andrew Sullivan, Ezra Klein, Stephen Bainbridge, Arnold Kling and Megan McArdle (twice).
I'm sure I'll have a great deal more to say on this subject at the new site I've launched with Patrick Ruffini and Soren Dayton, The Next Right. In the meantime, while I cannot identify a specific point of failure, I can pretty easily summarize the journey to failure in just two quotes.
From Ronald Reagan:
If you analyze it I believe the very heart and soul of conservatism is libertarianism. ... The basis of conservatism is a desire for less government interference or less centralized authority or more individual freedom and this is a pretty general description also of what libertarianism is.
To Rick Santorum:
One of the criticisms I make is to what I refer to as more of a libertarianish right. ... This whole idea of personal autonomy, well I don’t think most conservatives hold that point of view. Some do. They have this idea that people should be left alone, be able to do whatever they want to do, government should keep our taxes down and keep our regulations low, that we shouldn’t get involved in the bedroom, we shouldn’t get involved in cultural issues. You know, people should do whatever they want. Well, that is not how traditional conservatives view the world and I think most conservatives understand that individuals can’t go it alone. That there is no such society that I am aware of, where we’ve had radical individualism and that it succeeds as a culture.
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