Becoming more culturally liberal but more fiscally conservative like the Democrats have is a losing strategy in the south. Yes, most white southerners are fiscally conservative, but when you move to the right on economics, you know longer give the socially conservative New Deal Democrats any reason to vote for you.
The postwar South underwent a major progressive transformation from 1948-1980. A new class of pro-business white suburbanites challenged the viciously segregationist Dixiecrat hold on the region by voting Republican. Meanwhile, a new breed of "new Democrat", exemplified by the likes of Carter and Clinton, took over the Democratic party from said Dixiecrats. Hence, while voter turnout surged among both blacks and whites, a genuine two-party system emerged, neither new party looked like the segregationist patrician machines of the prewar South.
Why the South returned to a one-party state is unclear. It seems that political polarization has increased, so there is less room for a Jimmy Carter or Bill Clinton-style DLC Democrat anymore. A 1990 Supreme Court ruling mandated minority districts. With conservative white Democrats squeezed out of the party, Republicans became the only option for whites.
I think it's a combination of these two answers.
