The first piece of advice to the GOP is not to read too much into the election. The GOP still has very unpopular ratings. What is clear is that the voters were sending a message to an unpopular President. Voters were also telling the Democrats that the same old same old messages of a mythical War on Women and other trite, dubious talking points were overplayed (note Sen. Mark "Uterus" Udall's loss in Colorado and Sandra Fluke's loss for the California state senate). I believe that the voters thought that the Senate control by the Dems, e.g., weakening rules for judicial confirmations, sitting on bills passed by the House, only rarely passing a budget, etc., had been counterproductive.
There is a mixed message here--with Congressional contract comes accountability to the voters. In 2016 Obama won't be on the ballot, but the entire House will be, and the 2016 Senate races will have more GOP seats on the table. Don't forget the GOP-controlled House went from 270 seats in 1928 to 117 seats in 1932. If the Congress under the GOP is viewed by the people as unduly partisan and confrontational with Obama, it could mean a brief spell at the top. The Dems started a decades-long period in control in the 1950's, a decade after the GOP won 240 seats in the 1946 election. Don't sweat the small stuff; pick the right battles; avoid playing a political game of chicken. Obama is very good at playing the victim card, and the last thing you want is seeing Obama regain popularity at your expense because you went to the brink of shutting down the government. Zero-sum politics with a President holding the veto power and enough legislator votes to sustain it will do little more than drive your negatives with the independents and moderates you need in the next election cycle. However, an example of a good fight to take to Obama is repealing the unpopular mandate; a veto is not going to help his abysmal approval rating; even during his Messiah days, he himself was opposed to a mandate, and it sets up the GOP with a potent argument for the 2016 election.
The second piece of advice is to show that you've learned from your past mistakes. From a perspective of conservatives and libertarians, the GOP under Bush lost its moral authority on small government and limited government spending, e.g., the creation of the mega bureaucracy DHS, large increases of spending, the addition of an unpaid-for Medicare drug benefit, earmark abuse (e.g., the infamous Bridge to Nowhere), etc. Now is the time to find some genuine cost savings (streamlining government, consolidating agencies, reining back regulators, increasing oversight over the Executive Branch, etc.), privatizing certain operations (e.g., the USPS), devolution of spending/authority to the states, etc.
The third piece of advice is to do process reform. For example, restore and/or expand rights for the Senate minority, that essentially handcuffed the minority in terms of debate, amendments, judicial appointments, etc. Restore the annual budget discipline to the Senate.
The fourth piece of advice is don't try to hit home runs but bat for average. Even if you could get past a Democratic filibuster to fully repeal ObamaCare, a likely Presidential veto would be sustained in the Senate or the House. What you can do is enable interstate competition among insurance companies, allow self-insurance mechanisms and risk pooling across state lines, devolve subsidies for state/regional high risk pools, eliminate the controversial mandates, etc. If necessary, use budget reconciliation processes to get budget cuts if the Democrats threaten filibuster. Try to find areas of agreement with the President, e.g., immigration reform, COLA adjustments, prison sentence/drug law reform, education competition, business tax reform, NSA/TSA civil liberty reform, audit the Fed, etc.
The fifth piece of advice is to do necessary reform on entitlements and welfare state programs from your current position of strength. We need to tighten eligibility, cap benefits and tenure of eligibility (e.g., SSDI). We have to stabilize distributions, improve investment returns, and/or reform the regressive aspects of payroll taxes which tend to discourage lower-level employment. Among other things, I would look to means-test outflows, perhaps dedicate income from natural resources to replenish the reserve and/or competitively bid funds for diversified investment management, subsidize the payroll contributions of lower-income households. I would like to see ways to devolve healthcare to the states, do away with centralized government price-fixing and more of a less paperwork, concierge/doctor subscription model
The final piece of advice is to know your opponent (i.e., the President) and tailor your strategy/tactics accordingly. Let's be clear; this President thinks that he has a public mandate for his very "progressive" ideology, and despite suffering two of the worst midterms in American history, it was clear from his post-election remarks, hinting at vetoes and executive orders, he is not intererested in real compromise, only capitulation on his terms. From a political perspective, one should pose as the loyal opposition and provide positive, constructive solutions, discourage negative, personal rhetoric from the rank and file. A productive Congress with a defensive, hostile President will set the stage for 2016. Obama realizes that he is now a lame duck and he has to work with an opposition Congress to establish a durable legacy. I'm not confident that he has grasped the point or he would have taken steps to avoid the drubbing he has taken in 2 mid-term elections. I'm sure the Congressional Democrats realize that Obama's intransigence could harm their hopes of a political turnaround in 2016 and could signal their displeasure in different ways, e.g., veto-proof majorities on bipartisan legislation.
