I think the problem we're facing now can be summed up in a word: Populism.
The average person in the United States thinks altogether too much of themself. People are opinionated, confident, and uninformed: a dangerous trio when the right to vote is included. We have decisions being made on the basis of what the voters think they want, but the demands that voters make are unrealistic.
Lower taxes is a popular concept (amongst everyone who pays taxes anyway, though there certainly are a lot of people who don't pay taxes who unfortunately can vote and vote like government finances are irrelevant because they don't have to foot the bill), but everyone has their pet programs they want expanded and empowered. Conservatives support nearly unfettered military expenditure ("peace through strength"), expensive shows of force in the name of defense (Afganistan, Iraq, potentially someday Iran), unfinanced tax cuts (Bush Tax Cuts), and increased enforcement of law in costly areas (Immigration, Drugs). Where Liberals support increased social programs, regulation, expanding governmental budgets, and somehow, greater respect for and increased Civil Rights (which apparently the massive bureaucracy they envision will not impede upon).
Both points of view have become diametrically opposed, calling for cuts where the other side calls for expansion. The one thing everyone can agree on is the need for a healthy economy, but again, people fight tooth and nail over what path we should take to get there (often whipping the proverbial car back and forth constantly from road to road in the process). Neither philosophy really works because there's a serious lack of balance which results in regimes that rubberband back and forth from extreme to extreme, constantly undoing each others' achievements in the process. And each ideology is sort of failed and contradictory on its own. Large institutions don't have a good track record when it comes to respecting personal rights (Democrats) and you can't have small government when you're trying to impose traditionalism on the country as a whole by way of law.
Everyone seems to have their mind made up and set on their particular brand of politics, so sure that the things they believe are correct. It seems like every administration today does such an excellent job of shoving their agenda down the other side's throat that there's an almost immediate resurgence of political willpower which destroys them. Remember how the media kept discussing, rightly so, the implosion of the Republican Party not 2 years ago? So much for that; you can thank the Democrats for giving them CPR by passing so many large pieces of legislation and ratcheting up the debt exactly as was predicted.
What's most infuriating of all is that while the Democrats may have made the right decisions overall (though I don't think they're infallible by any stretch of the imagination -- they've certainly made a lot of mistakes too), it doesn't matter. We can no longer agree on fact anymore in this country because everyone thinks they're an expert. We've become too individualistic and impressed by our own abilities to think and reason; arrogance and self-confidence of thought has reached epidemic proportions, and it's beginning to manifest itself in all things.
Until someone makes the voters take a hard look at their demands, I don't think our country is going anywhere but down. Of course, no one will do that, because the second that anyone says anything against the masses, they're pushed out of office and rendered politically irrelevant. I don't know what the solution, but somehow, as a country, we need to realize that we don't have all of the answers and our political outlooks are just opinions.
We need to get realistic.