I'd put the break with reality in the GOP back a little farther ... mid '90s. That was when the Newt and the fraudulent "Contract with America" were en vogue, Talk Radio started pushing it's ultra-right propaganda and rank and file republicans became more interested in what Clinton did with his penis than his presidential pen.
One could point back to the Reagan Revolution as being the start of the insanity. Reagan certainly promoted the cause of the conservative movement. The "Moral Majority" came into being around the time of his campaign and enjoyed influence throughout his presidency. But Reagan could and did work with the democrats. And while his foreign and fiscal policy was sometimes reckless, it pales in comparison to the lunacy that was to follow.
