The Economist describes the fall of the neocons:
Sidelined by reality, The Economist: The American legal system has rediscovered the virtue of one of the most ancient forms of punishment—public humiliation. Prostitutes' “Johns” can now have their names aired on television. Mail thieves can find themselves wearing a sandwichboard giving full details of their crime. ...
And neoconservatives? These too, it seems, are now being subjected to a grand exercise in public humiliation. Paul Wolfowitz is hanging on to his job at the World Bank by his fingernails. Lewis “Scooter” Libby, a Wolfowitz protégé, is facing prison; Douglas Feith, who worked with Mr Wolfowitz at the Pentagon, is an “untouchable” who is floating around the margins of academia.
As for their patrons, Donald Rumsfeld, Mr Wolfowitz's patron, was sacked from the Pentagon amid accusations that he had lost the Republicans their majority. Dick Cheney is so unpopular that he has provoked protests even at Brigham Young University... Conrad Black, one of the movement's most generous sugar daddies, is on trial for fraud. It seems that those whom the gods wish to punish they first make neocons.
Not all the neocons have been humiliated quite as badly... Many of them—including Richard Perle ... and David Frum, the man who co-coined the phrase “axis of evil”—are safely on board the starship American Enterprise Institute. Charles Krauthammer and Bill Kristol are as ubiquitous as ever in the media... Robert Kagan is ... writing an ambitious history of American foreign policy.
And neoconservativism is not entirely finished as a political force. George Bush rejected the Baker-Hamilton report ... in favour of the neocon-designed “surge”. Elliott Abrams is a deputy at the National Security Council. Mr Cheney is proving no more destructible than Lord Voldemort. John McCain is blowing loudly on the neocon trumpet; Rudy Giuliani, having flirted with “realists”, has decided to stick with neocon foreign-policy advisers.
But the movement's implosion is nevertheless astonishing. One neocon sums up the prevailing mood in the movement. The neocons are a “laughing stock”. Their “embrace of power” has been “a disaster”. ... The “surge” is a desperate response to failure. ...
The neocons are being relentlessly marginalised in Washington. ... They are also being marginalised—or at least slapped down a bit—within the conservative movement. .... Realists dislike them for their destabilising foreign policy. Small-government types dislike them for their indifference to government spending. Libertarians dislike them for their preoccupation with using the state to impose virtue. Neoconservatism could well return to where it started—the intellectual property of a handful of families called Kristol, Podhoretz and Kagan.
Why does the movement seem so discredited? Partly for practical reasons. They misread intelligence about WMD and links between al-Qaeda and Saddam (though some still believe in both notions). They bungled the war in Iraq. They had little real experience of either the Arab world or soldiering. Many of them were even poor managers. Gary Schmitt, a fellow neocon, complained of Mr Feith that he “can't manage anything... General Tommy Franks describes him as the “dumbest fucking guy on the planet”.
Betraying the founders
But, more important, neocons have been discredited for ideological reasons. Most of the recent mistakes can be traced back not just to flawed execution but to flawed thinking. The neocons argued that democracy might be an antidote to the Middle East's problems: but democracy proved too delicate a plant. They claimed that the assertion of American power might wipe out “Vietnam syndrome”: but it has ended up making America more reluctant to intervene abroad. They talked about linking American power with American ideals: but it turned out, at Abu Ghraib and Guantánamo, that power can corrupt those ideals.
The tragedy of neoconservatism is that the movement began as a critique of the arrogance of power. Early neocons warned that government schemes to improve the world might well end up making it worse. They also argued that social engineers are always plagued by the law of unintended consequences. The neocons have not only messed up American foreign policy by forgetting their founders' insights. They may also have put a stake through the heart of their own movement.
Let's hope so.
Update: Brad DeLong says the last two paragraphs are "false and stupid" as he corrects the record.