The question is, therefore, should it continue to do the first?
A fair number of Republicans, some of them recent candidates traumatized by public disaffection for the Iraq War during the last election cycle, believe that the party is dead, and should be put out of its misery as quickly as possible.
Others believe that, since the party has basically abandoned efforts to hold the government to its limitations under that obscure statute known as The Constitution, it can no longer address the critical issues of the day, and deserves the same fate as the Whig Party. The Whigs, incapable of producing a coherent philosophical position about slavery, found themselves quickly put out of business, replaced by the Republicans, who knew exactly where they stood on the issue.
Statewide, the party leadership made a number of catastrophic mistakes, practically scripted to damage the brand, split the membership, and leave it in minority status. Aside from Ref C, which cost the party is claim to be the low-tax party, it also failed to confront campaign finance "reform," which created loopholes big enough to drive a truck through - loopholes all of which were conveniently located on the left-hand side of the road.
These mistakes left the party defenseless against attacks it was practically begging the Left to launch.
Some commentators are taking the "worse is better" approach to electoral politics. This has a soft form - lose an election badly enough to shake up the membership - and a hard form: lose badly enough to collapse the party entirely and leave room for a more principled replacement. The first is a reckless gamble, the latter a childish approach to politics that would throw away the eminently salvageable political machinery of generations.
The problem is, either one of these alternatives will leave a vacuum (which nature and justice abhor) giving over massive majorities to the Democrats. We've subjected the country to the tender mercies of the Democrats a few times in history, and the results haven't been stellar. In reverse chronological order, they've resulted in an intractable welfare state (LBJ and the Great Society), massive economic mismanagement (FDR and the Great Depression), temporary abandonment of the rule of law (Woodrow Wilson and WWI), and the dismemberment of the country (Buchanan and the Civil War).
The election laws aren't favorable to third parties, and it could take several election cycles before a new party established itself. And crushing electoral defeats can lead to decades of self-doubt and disintegration (see Democrats 1972 to 1992). In fact, the party could simply limp along in minority status for decades, decades that the country simply no longer has the luxury of. It's done so before.
The fact is, instead of cynically rooting for disaster, we would be better served to begin rebuilding the party brand now. We should be looking for candidates who stand for something, rather than being happy with the, "well, we're better than them" line, which has been played out for several elections.
We should be looking for candidates who can begin pushing the Constitutionalist ideals which the rank-and-file expect it to. We should be supporting those candidates.