There are a lot of ways to parse a loss like the one the GOP suffered on Tuesday, but what ought to be increasingly clear to smart Republicans is that there's something fundamentally problematic in how they've gone about assembling their electoral coalitions. Conservatives are complaining a lot in the last couple of days that Obama ran a "divisive" campaign, I guess because he once called rich people "fat cats" or something, but the truth is that Republicans have been experts at division for a long time. Much of their appeal, at one level or another, has been "We don't like those kind of people." Sometimes it's welfare recipients, sometimes it's undocumented immigrants, sometimes it's people who come from big cities or have too much education or enjoy a coffee drink made with espresso and steamed milk. They've been very good for a very long time at telling voters, "We're just like you, because we both hate those people over there."
As a political strategy, this can be very effective, so long as the "them" at whom you're directing your contempt isn't too large a group. But once "them" grows too big, you've dug yourself an electoral hole. That's the problem they now have with Latinos. Their anti-immigrant rhetoric sent two simultaneous messages, one about policy and one about identity. The first message was that we don't support policies you do support, like the DREAM Act. The second message, which Latinos heard loud and clear, was this: We don't like people like you.
The problem can be seen in other areas too. As Sommer Mathis and Charles Mahtesian point out, the GOP is getting crushed among urban dwellers, who are growing as a proportion of the population. Just like with Latinos, this happens because of both policy and identity. The GOP is opposed to policies that are supported by people in cities, like support for mass transit. But they also continuously tell them that they don't like them. Every time they wax rhapsodic about the superior morality of those who live in small towns (what Sarah Palin memorably called "the pro-America areas of this great nation"), where people supposedly have "values," while people who live in cities just have opinions, they are telling voters in cities, "We don't like people like you." So it's no surprise that those voters respond, "You know what? We don't like you either."
If Republicans are going to solve this problem—with Latinos, with city dwellers, and with everybody else they've alienated—they're going to have to it with both policy and identity. It won't be enough to sign on to a comprehensive immigration reform. You have to convince the people at whom you've been sneering (or trying to stop from voting) that you don't hate them. It's not an easy task, but it can be done.