There came a realization that the 'New Deal" programs were so entrenched that it was a losing battle. Reagan tried to starve them to death with tax reductions but also had to make large concessions for the same strategy of spending the Soviets into bankruptcy on defense buildups.
That "realization," as you call it, is one of the basic precepts of neo-conservativism: Don't even think about undoing what has already been done, 'cause it won't fly.
Reform, yes. Repeal, no.