Lest my earlier post (Donkey Dying) seem too pessimistic, let's remember that this election was never in the bag for the Democrats. Incumbents are always tough to beat, but plenty of people convinced themselves that with negative right/wrong track numbers and a soft economy, and then Iraq on top of it, Bush was certain to go down. Well, Bush never moved into the clear danger range of job approval (below 45 percent), the right track/wrong track numbers were never that bad, and the economy has been gaining strength after a relatively shallow recession. Bush was never as vulnerable as his father in 1992 or Jimmy Carter in 1980. The other thing to remember is that this election was pretty much a replay of 2000. Bush won, but only with 51% of the vote. No landslide there.
Nonetheless, as my earlier post pointed out, the Republicans made some significant gains and the Democrats will have to think hard about how to get back on top. I for one think Kerry ran a pretty good campaign. He unified the party and had 3 very strong debate performances, so I don't think that was the problem. The real problem is how Democrats can begin to capture a majority of voters on foreign policy and on social/moral issues. The absolute worse thing they can do is take the attitude that the election reflects some deep flaw in the intelligence or values of the American people.