What decided the last two elections was "values"; most of the respondents could not quite explain what they meant by "values".
Hmm, some polls show this, but other polls showed terrorism/homeland security and the economy as issues of primary concern. Like it or not, the Republicans had an edge in these polls on which party was betrer equipped to handle these particular issues. Tax cuts were indeed low on the priority list in most if not all polls, but this is not identical to strong opposition to them.
The polls also indicate a majority prefer a bipartisan approach to governance, so it is possible the Republicans will overreach. There is a significant free-market libertarian wing in the Republican party that is not enamored of the religious right's agenda and might be open to moderate overtures on the part of the other party. It's early, but McCain and Giuliani, both moderates, top the GOP presidential preference polls for 2008 as of now. H. Clinton tops the Democratic preference polls and has been sounding a more moderate note of late.
And thern there are the independents.