Is the Tail Wagging the Elephant?

But the xenophobes won the battle. The immigration bill went down to defeat and took some Republicans like Sen. John McCain down with it. This sentiment also signals more of an isolationist sentiment, which in turn would make more people in the GOP feel uncomfortable with foreign trade. The anti-immigrant sentiment could hurt the GOP with Hispanic voters, who now constitute 10% of the electorate and continue growing.

The lack of an immigration bill and fiscal responsibility has also hurt the GOP with business. Many small businesses depend on immigrant laborers to keep costs down. The best example of dissatisfaction may be seen by the recent book that former Fed Chair Alan Greenspan wrote where he expressed "the GOP deserved to lose" in the 2006 elections.

The other growing piece of the electorate is independents, making up about 20% of registered voters. Democratic voters have remained steady, but the GOP has lost voters over the last few years, and in 2006, as the Democrats took over both the House and the Senate, the GOP lost the independents.

The leading GOP presidential candidates grasp there is a problem. Former governor Mitt Romney has changed his campaign theme to try to run on change. He wants the GOP to return to its past ideals of small government, strong defense and family values.

Former New York City Mayor Rudy Giuliani says that fiscal responsibility and tax cuts can unite the GOP again, and that Sen. John McCain echoes that sentiment, with a particular mention of earmark reform.