The Republican brand has been tarnished by excess and by a message that doesn't match their deeds. If, as signs indicate, they loose this election, then we may be able to ensure that they don't rise from the ashes as they currently exist if we accomplish a few goals I outline below the fold.
Bluntly - the repbulicans brought on their own demise through their saying one thing (compassionate conservative, small government) but doing another (torture, Homeland security). They didn't practice what they preached and worse (illegal wiretaps, secrecy, war based on lies). Toss in Sarah Palin and the rejection becomes massive for this election.
Right now, we (and I include myself as a newly minted democrat (formerly independent)) are riding a dual wave - one wave of hope that Obama's mostly populist message will lift the average person out of the "trickle down" snot slime of Reaganomics, and the second wave is the outright rejection of the false fiscal accountability message and fear mongering the republicans continue to tout even in the face of their actual record.
If the Democratic Party wants to continue to be the party that leads this nation for decades to come, then the party needs to accomplish several things if (as all signs indicate) Obama wins -
1. a health care system that provides for everyone (as a right) while letting businesses, large and small, regain competitiveness with the world. (I believe our current health care system is anti-competitive on a global scale.) This is going to require a massive battle against the insurance (and drug?) industry.
2. Massive jobs creation that occurs in such a way that that businesses are the source of the jobs. If we can categorically show that democratic policy leads to massive job and small business creation through policies such as energy job creation and tax policies that inhibit businesses from shipping jobs overseas (including allowing more H1-B visas to allow highly qualified employees to work and spend here rather than in India and China etc) then we can show the (hopefully former) republicans that there are alternative ways to lift the boat for everyone. Their policy was that if we make the rich richer then it will trickle down to the little guy. This policy has proved a failure. We must show that emphasizing the little guy also benefits the rich guy in order to show a classic win-win that virtually no one can dispute. It shouldn't be hard to prove given economy of scale. Look at the results of massive small contributions smashing records for campaign finances - I stipulate that this shows that raising the standard of living of the massive number of regular folks will result in everyone's boat being lifted.
3. Fiscal restraint - for years republicans have trotted out the "tax and spend" label to our detriment. If we show that we can have the restraint to constantly apply pay-go policy to every item, and successfully bring down the $11 trillion national debt (including implementing serious budget cuts), then we become the party of (insert new catchy slogan here for party of fiscal responsibility).
4. A foreign policy that lifts our standing in the world without appearing to be wusses. Strong where needed, but employing true diplomacy to bring people together in agreement that there are solutions to problems that don't require people to kill one another for the solution.
Republicans have to remake themselves. If they are not completely blind they should recognize their message has been lost. As described in Global Meltdown Part IIif the 3rd leg of the "moralists" (abortion and gays) get together with libertarians, then they could create a new party that could rise from the ashes of the neocon era. Preventing that rise depends on not driving the democratic party down the same path of excess that the republicans found themselves. Can we keep from falling off the narrow path? Only time will tell.