Conservatism has been hit by a perfect storm, virtually all of its own making. The fronts of this storm are:
1) The contradiction between social conservatism and small-government libertarianism. This hasn't so much lost conservative voters as it has boggled the compass. When you're arguing on the one hand that government is too blunt and instrument to reasonably regulate finances or the environment, but on the other hand the nanny-state knows best when it comes to terminating a pregnancy or setting limits on scientific research, you're bound to get lost in the woods
2) The permanent campaign & the culture war. When your governing agenda boils down to "defeat Democrats," then you're going to come off as sore losers. Dividing people may win elections, but governing a divided population is impossible. Ipso facto, you must choose a broad demographic whose interests you, frankly, disdain. So you end up pandering to 51% of the population by constantly (not just during an election season) trashing the other 49%.
3) Loyalty to Bush. Guys, this isn't a tough one. We keep the tapes. You spent between four to eight years questioning the patriotism of anyone who criticized the Bush administration. You guys all said that this was the apotheosis of conservatism. You guys all said that he was doing everything right and that we were now living in the shining city on the hill. In 2002, you had a lot of support for that idea. By 2006, it was clear you were putting party not just before country but before reality.
4) The Iraq war. Actually, the war itself isn't such a problem. Cheerleaders though you were, so were the Democrats. Mostly, the narrative we have is that the Bush Administration (not Republicans in general) flat out lied. Congress bought the lies wholesale. But, naturally, the party of the president is going to take the biggest hit here. So much for all those "Democrat" wars, eh?
5) The anti-intellectualism. It's not just turning off the electorate, but it's starving your movement of thought. If you're going to be the party of ideas, you may want to esteem things like, you know, knowing stuff and talking good.
6) The economic crash. It's not just that we hit a "once in a century" tsunami. It's that the tsunami seems to be a logical consequence of applying your economic philosophy. When Alan Greenspan says that he discovered a "flaw in his ideology," well, that's gotta be the final nail in the "markets always know best" coffin. "Markets always know best" was your best line, the one everybody always bought. Once that's out the window, what do you have besides God, guns and gays?
7) Bullying. As more and more of us out here began to have our doubts, what was your response? To yell at us louder and louder about how un-American we all are. And before you say you never did, remember, we kept the tapes.