GOP car wreck: a tune-up won't fix it.

WELL before midnight on Election Night, three things became clear. First, the Democrats were having a rollicking good election. Second, liberal pundits were having a rollicking good time talking about it. And third, fumbling Republican operatives and flummoxed conservative pundits had lost their perspective on the election, focusing on the narrow margins of some of the Democrats' House and Senate wins and rushing to assert that the voters weren't repudiating their ideas--just the GOP Congress and its corruption, profligate spending, and soggy leadership.

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I'm not denying that some of the Democratic gains were won narrowly (though the same could be said for several Republican saves). And the corruption issue played a significant role in at least a dozen GOP House losses. But the scope of the Democratic victory surpasses any attempt to explain it away. It reflected something far more fundamental, and more challenging: As a vehicle for electing leaders and producing governing ideas, the Republican party is creaking and coasting. It doesn't just need a tune-up (like more get-out-the-vote programs) or a lube job (more money). It must be redesigned from bumper to bumper.

To comprehend the magnitude of the GOP's challenge, look beyond the federal races to state contests. Pre-election, Republicans held a majority of governorships (28-22) and a slight advantage in state legislatures. There are 99 legislative chambers (Nebraska's is unicameral and nonpartisan). Of the 98 partisan bodies, Republicans held 49 and Democrats 47. Two chambers were tied. As a whole, Republicans controlled 20 state legislatures and Democrats 19, with ten legislatures split between the parties. This parity in state governments had been one of the most significant and lasting products of the 1994 Republican revolution, which put an end to Democratic dominance at the state level (going into 1994, Republicans controlled legislatures in only eight states, versus 24 controlled by Democrats).

Things look very different now. The gubernatorial split is reversed, with Democrats holding 28 states. Two big-state losses were New York and Ohio, where Democrats Eliot Spitzer and Ted Strickland won easy victories. California retained Republican governor Arnold Schwarzenegger, but only because he no longer looks much like a Republican. Among the ten most populous states, only Texas, Florida, and Georgia now have mainstream--that is, conservative--Republican governors.

What's worse for the GOP, several notable Democratic governors first elected in relatively close races four years ago breezed to reelection in 2006. In Tennessee, Democrat Phil Bredesen won a 51-48 majority in 2002; in Arizona, Democrat Janet Napolitano managed only a 46-45 squeaker. In 2006, both Bredesen and Napolitano crushed their opponents and won support up into the 60s. In Michigan, Jennifer Granholm became a new Democratic star in 2002 with a 51-48 win. This year, despite a well-funded effort by businessman Dick DeVos and widespread public disaffection with Michigan's economy, Granholm soared to a 56-42 win. By contrast, Republican Tim Pawlenty won the governorship in Minnesota four years ago by a seven-point margin. This year, he offered the GOP a rare bit of good news by eking out a 47-46 reelection.

At the legislative level, Democrats gained at least 320 seats and nine chambers. Republicans gained only one chamber, the Montana house. They did manage a tie in two previously Democratic senates, in Oklahoma and Montana, but party control won't change because both states have Democrats in the appropriate executive-branch offices. There are now 55 Democratic chambers and 40 Republican ones. Democrats control both chambers in 23 states, Republicans in only 15. Even these numbers understate the GOP's problem: In many legislatures already Democratic but not by much, this election expanded the margins significantly. Where Republicans once dreamed of flipping chambers with a gain of a seat or two, they now see yawning gaps. Tim Storey, an analyst for the National Conference of State Legislatures, said at a post-election forum that there are now fewer legislative chambers controlled by narrow majorities (below 55 percent) than at any time since the late 1980s.

State elections are important and telling. They have a tremendous influence on public policies that affect people's lives on a daily basis. State courts decide major social and constitutional issues, usually without subsequent appeal to the federal Supremes. Moreover, from the ranks of state legislators and governors come future candidates for Congress and president. And from the work of governors and state legislators have come many of the most compelling policy ideas of the past decade, such as welfare reform and school choice.

There's still another reason Republicans need to get their act together at the state level, perhaps the most pressing one of all: The Census is coming. After 2010, legislatures in most states will redraw the lines for congressional and legislative seats. If Democrats retain their current edge, the U.S. House will get a lot more blue.

It simply won't do to chalk up Democrats' gains to bad luck, historical inevitability, or Mark Foley. Having talked to a number of political pros about the election results, I think the GOP's redesign has to include the following elements:

Better candidates. The Democrats had a far better round of candidate recruitment in 2006. Their standard-bearers were good fits for the constituencies they sought to represent--emphasizing fiscal moderation in fast-growing suburbs, social moderation in small towns and rural areas. Many had relevant political or professional experience. Quite a few simply looked good on television (sorry to be shallow, but it matters). Republicans will always have a disadvantage in candidate recruitment: Democratic activists want governments to expand in part so they can have jobs running governments. But the GOP had better figure out a way not to fall so far behind. They need a deeper, stronger bench.

Stronger coalitions. There are at least four identifiable elements of the Republican coalition that reached majority status in 1994: economic conservatives, social conservatives, hawks, and leadership voters (think Reagan-era upbeats and Perot populists). In 2006, each group was presented with reasons to peel off. Most voters didn't, but those who did--the ones who have always been less partisan and ideological in their voting behavior--tipped the balance. Some economic conservatives were angry about pork-barrel spending and federal deficits. Social conservatives felt let down by scandals and saw little progress on the issues they cared about. Hawks were disappointed in the president's apparent lack of a strategy for victory in Iraq. And leadership voters had their confidence in GOP competence badly shaken, not just by Iraq but also by the Katrina response and Capitol Hill ethics investigations.

The Democratic coalition--on paper, more diverse and unwieldy--was bound together in 2006 by sturdy ties. Its members wanted to regain power. They hated Bush. They thought he had stolen two elections from them. Thus radical environmentalists, pro-choice activists, peaceniks, urban pols, race-preference hustlers, union reps, and aging hippies all embraced moderate-to-conservative Democratic candidates with surprisingly few reservations.

Better messages. National security, tax cuts, and traditional values have brought Republican victories in recent cycles. They aren't enough to sustain an electoral majority. Swing voters want to hear solutions to practical problems in their everyday lives. Republicans must find their voice and effectively articulate sound, market-based solutions on education, health care, transportation, and other key domestic issues. It's hard but necessary work.

There's no need for Republicans to panic. It is true that their 2006 losses weren't much different from the historical averages. Many Democratic gains were by small margins, in otherwise GOP-trending areas. Traditionally Republican ideas about government and society do retain validity and salience, illustrated by the fact that so many Democrats won election by claiming them as their own. But Republicans need to take their present challenge seriously, and trash the self-serving talking points.

Mr. Hood is chairman and president of the John Locke Foundation, a state-policy think tank in North Carolina. His books include Investor Politics and Selling the Dream.