By Peter J. Smith

WATERTOWN, New York ( – Doug Hoffman, the upstart third-party Conservative candidate for the special election in New York's 23rd congressional district, conceded defeat to Democrat Bill Owens early Wednesday morning.

The final tally showed Owens beating out Hoffman by 4,000 votes, 49 percent to 45 percent. On social issues, Owens has identified himself as “pro-choice” regarding abortion, but on marriage, he indicated that he favored President Obama's position: against same-sex “marriage,” but for civil unions.

GOP Assemblywoman Dede Scozzafava, who suspended her campaign on Saturday and endorsed the Democrat Owens over the Conservative/Republican Hoffman, still remained on the Republican and Independence Party tickets and received 6 percent of the vote.

“This race was a very tough race. We stood up against two major parties that had a lot of money, but we got this far on determination, and we got this far with a grassroots campaign that got many volunteers out,” Hoffman said in his concession speech.

“This one was worth the fight,” he continued, telling his supporters that their fight was a fight for America. “And it's only one fight in the battle, and we have to keep fighting.”

Hoffman built an insurgent third-party campaign running on the Conservative Party ticket that tapped into district grass-roots anger that GOP party bosses had nominated a Republican who boasted a very liberal record on both social and fiscal issues.

While polls on the eve of election-day showed Hoffman having pulled ahead by at least five points, Scozzafava's weekend endorsement of Owens after the implosion of her own campaign, which had the blessing of national GOP leaders, may have proved the game-changer.

Scozzafava has close ties to the labor unions – her husband is a labor organizer – and channeled that on-the-ground support into Owens campaign. The Albany Times Union reports that powerful New York unions poured in hundreds of thousands of dollars to oppose Hoffman.

Scozzafava's endorsement of Owens was met with horror by state GOP leaders and national Republicans, who had poured around $900,000 into her candidacy and supported her in spite of the fierce conservative resistance that fueled Hoffman's rise, which depended heavily on small-size donations and the endorsements of conservative organizations and personalities. GOP Chairman Michael Steele had called Scozzafava's original decision to back out of the race a “selfless act” – a statement that proved embarrassing once Scozzafava endorsed Owens in the Watertown Daily Times.

Hoffman had much on the ground grassroots support from Susan B. Anthony List (SBA) and the National Organization for Marriage (NOM), which coordinated an effort to man the polls and canvass the district with pro-life, pro-family volunteers that were key to Hoffman's strong showing on election day as a third-party candidate.

Hoffman's defeat is not likely to dampen the conservative insurgency that has ignited within the Republican Party. Politico reported on Election Day that grass-roots activists, especially in the “Tea Party” movement, have targeted a dozen GOP lawmakers for primary challenges.

“To be frank, this is a win for motivated conservative activists who are driven by issues and not party. Dede Scozzafava's advocacy of the extreme Obama agenda would have been a great loss for the GOP and all those who care about the values enshrined in its platform,” said Marjorie Dannenfelser, President of SBA. “The road to a GOP majority is not paved with taxpayer-funded abortion, same-sex marriage and government-run healthcare.”

“In going the difficult route as a third-party candidate, Hoffman generated funds, volunteers, and enthusiasm for his message of fiscal and cultural conservatism. That he came as close as he did running as an insurgent is an accomplishment in itself,” wrote analyst John Gizzi at Human Events.

What lessons the GOP has learned from the battle over NY-23 will reveal themselves in the days to come. Liberal members of the GOP contend that Hoffman's defeat shows that conservatives cannot win without embracing “moderate” candidates. Conservatives for their part contend that Scozzafava's implosion and endorsement of Owens to play the spoiler in the race as the GOP candidate shows the contrary: the GOP cannot ignore its grass-roots when it comes to selecting candidates.