Palin already tipped as 2012 candidate

On a night of shattering defeats, the Alaskan governor appeared to survive the wreckage caused by George Bush's unprecedented unpopularity with her own reputation enhanced.

In a telling moment, Mrs Palin won the biggest cheer in John McCain's concession speech when he tantalisingly declared that "we all look forward to her future service", a clear hint at a presidential run in four years.

Mrs Palin's ability to energise the Republican base - and to raise the hard cash needed for any candidacy - certainly puts her in a strong position.

But the fact that she appeared to turn off millions of independent voters is seen by many moderates as proof that she can never win the whole country, and presages a wider split in what Americans call the Grand Old Party. Just four years after Mr Bush won a second term, the Republicans are poised for a prolonged period of blood-letting as a withered rump in Congress fights for control of its future direction.

Even though the Democrats looked unlikely to clinch the crucial 60 seats needed for unfettered control of the Senate, their gains in both houses means they have the upper hand for the first time since 1994. While social conservatives still backed the Republicans, they appear to have lost the blue collar voters, Hispanics and even business voters that got Mr Bush into power.

The party is set to split into several factions, with Mrs Palin leading the family-values wing and Mitt Romney, another likely contender for 2012, asserting himself as the sensible, pro-business candidate.

Mr Romney has already won the backing of the influential National Review magazine, which called him a "full-spectrum conservative".

"Sarah Palin is a lightweight, she won't be the first, not even the third, person people will think of when it comes to 2012," says one former Romney aide, who had worked for McCain-Palin.

But Jim Nuzzo, a White House aide to the first President Bush, dismissed Mrs Palin's critics, saying: "Win or lose, there is a ready-made conservative candidate waiting in the wings. Sarah Palin is not the new Iain Duncan Smith, she is the new Ronald Reagan."