We've all seen this diagram before, and some agree that it is valid, and others argue that it really doesn't represent people's views. I would argue that it works, as long as you understand that the diagram is a political game board that it is constantly in movement, rolling around based on current events -- and the people on the board lean and sometimes move based on the board moving.
There are people whose natural inclination is to be libertarian-leaning Conservatives and others who are statist-leaning Conservatives. Whether or not we want to admit it, there are also centrist-leaning Conservatives who could have and might even have voted for Obama -- although I doubt that there are any of them here on FR . Yet those "leanings", not the Conservatism, are the source of most of our FR arguments.
The big question to me is where the Republican Party stands on this game board, and who does it want to capture with its message? If the Republican Party wants to survive, it must look to what attracts, not just its grumpy old farts (who are already basically "lifers"), but rather what can mobilize its younger generation to get out the vote. Because getting up a "McCain Facebook page" 5 days before the election when Obama has had one up for two years, didn't cut it last election and certainly isn't going to cut it in the future.
I would argue that the vast majority of the younger voters are going to be libertarian-leaning. They were as attracted to Ron Paul, as the statist-leaning Republicans were revolted by him. But these younger voters are the ones who really were mobilized to win -- they knew the latest and most popular methods of communicating the message and were wizards at fundraising. The problem is that no one took them seriously and the Republican Party completely marginalized them last election.
So the next question is: What now? Is the Republican Party going to stay the statist, old farts club? Or is going to capture the small "l" libertarians? Because, IMHO, that is going to make the difference between whether the Party can and will ever be taken seriously again.