When John McCain at last focused on the economy in this campaign, he recycled the Republican playbook from the late 70s and early 80s. Those old moves had had a remarkable shelf life, lasting a generation. They had carried the first of the hapless Bushes to the White House in 1988 and powered Newt Gingrich’s revolution in 1994. Even at the start of a new century they were still in use, occupying the heart of George W. Bush’s domestic economic policies.

But now McCain is learning the hard way, even if he won’t yet admit it, that the Reagan playbook’s time has come and gone. The old Republican trick was to lie about taxes: Democrats would raise everybody’s and Republicans would cut everybody’s. (In reality, Republican largesse meant the millionaire reaped a windfall while the waitress got pennies and the public debt soared.) McCain has resuscitated that canard, making the case against Obama’s progressive tax policy. But he’ll lose the argument—and the Presidency—because the Republican era of wholesale deregulation and the redistribution of wealth, upward, is over.

It is no longer enough to utter conservative epithets like “liberal” and “tax.” McCain’s implication that Obama wants to “spread the wealth” around rather than create wealth is dissonant at a time when Republicans are presiding over the greatest wealth destruction in history. Meantime, Obama has brilliantly pounded two numbers into the national consciousness—$250,000 (you don’t face a tax increase if you earn less) and 95 percent (the percentage of Americans who will receive a tax cut under Obama’s proposal).

As the campaign entered its final fortnight, smart Republicans began suggesting that McCain put some spin on this ball to give it a semblance of still being in play. During a debate with me last week in Washington, Frum urged McCain’s campaign to grasp for yet another message—this time, the danger of one party dominance of Washington. Conservatives heartily approved of one party—their party’s—dominance from 2003 to 2007. What they dread now is that Democratic ascendance could lead to horrors like national health reform.

Although the faithful chant, “Obama, Pelosi, Reid” at McCain’s sparsely attended rallies, voters overall now scorn the appeal to divided government. In addition to being politically misguided, this latest Republican argument is flatly ahistorical.

Great economic challenges—from the New Deal in 1932, to the new economics of the 1960s (which followed three recessions in the preceding decade), to the Clinton fiscal turnaround in 1993—were all handled by one party—the Democratic Party, as it happened—in charge at both ends of Pennsylvania Avenue. Even the exception proved the rule. In 1981, President Reagan enjoyed a Republican Senate and effective control of the House on taxes and spending due to support from conservative Democrats.

Back in 2008, we keep hearing about Joe the Plumber. If McCain were paying Joe a plumber’s hourly wage for his time, he wouldn’t have any cash left for travel or television. Yet it still doesn’t seem to be working. The evident failure of McCain’s argument, the last in a series of tactical improvisations, is more than a prelude to defeat for one man or one party in one election. Instead, the 2008 campaign has shown that we have, at long last, entered post-Reagan America.

At what may be the dawn of a new progressive era, Republicans will have to make a choice. I don’t believe they ever will, or even should, proclaim “me too” and mimic Democrats. Instead, they should rethink and then renew their purpose, asking hard questions about the meaning of conservative principles in a different economy and a changing world. The alternative is to repeat the past, perhaps with Sarah Palin, the hockey mom in couture, in a starring role. Ronald Reagan, who in his dealings with the Russians proved he was more realist than ideologue, would surely look at such a legacy and ask: “Where’s the rest of me?”