A lot of Democrats are populist. A lot of tea partiers are libertarian.
However, one thing I've always noticed about many self-described libertarians is that they don't really care much about social issues. They usually just focus on economic policy and aim for the extreme right.
This is why I consider the tea partiers right wingers. They aren't really for smaller government when it comes to social policy, but they want lower taxes and they fear the word "socialism."
As long as that's the case, it's just a matter of the GOP moving further rightward on economic issues without conceding much on social issues.
By the same token, a lot of the Democrats are already moderate on both social and economic issues, which is why it's becoming readily apparent that only a relatively small proportion of the population can really be considered "liberal."
Typically, people are only liberal when it benefits them.