After November 2, 2010: Where do we go from here?

On Tuesday November 2, 2010 the Republicans regained control of the United States House of Representatives, numerous state houses, and gubernatorial posts in their and the Tea Party's efforts to take the country back.  After a brief two years in control, the Democrats were lucky to barely hold on to a slim majority in the United States Senate. 
What happened?  According to the Tea Party and the Republican party too much government spending and according to the Democrats not enough job growth.  Mississippi ousted two marginal Democrats in Travis Childers and Gene Taylor, so that even Democrats who actively distanced themselves from President Obama lost their seats.  In two short years the nation has gone from embracing "change" and "hope" to embracing the party of "nope".
No Health Care
No new taxes
No earmarks
No compromises
No cooperation with President Obama or the Democrats
And according to new Florida United Senator Mark Rubio, no cooperation with even moderate Republicans either.  While more attention was focused on Sharron Angle of Nevada and Christine O'Donnell of Delaware, the Tea Party movement was able to get minorities such as Mark Rubio and  LTC Allen West of Florida and Tim Scott of South Carolina elected. 
But the mid-term elections are over and the question is where do we do from here?  November 2012 is less than two years away.  What are our priorities for the new two years?  Can the Democratic party and President Obama recover before the 2012 presidential elections?  What should they do to attract more African Americans and young people to the polls?