I always thought it referred to the Jonestown tragedy but I've heard it mentioned so often in this year's election race that I figure it must have an alternate meaning. What the heck is everyone talking about?
It does refer to the Jonestown tragedy. If I say you're drinking the Kool-Aid of McCain, it means you're buying into his message wholeheartedly, usually without a full understanding of the facts.
I believe it goes further than that: accusing someone of "drinking the Kool-Aid" is a contemptuous dismissal of everything they have to say on a particular topic. The implication is that a person is so completely given over to a single strident belief that conflicting information and rational thought are drowned out in a heady rush of pure, mindless devotion.
It's a lazy, generic way of saying, "You're so blinded by loyalty that you're just senselessly parroting whatever you've been told to think, so your rationalizations and 'beliefs' are beneath my need to respond."
Of course, depending on how swiftly the phrase is invoked, it often *really* means, "I can't win this issue on the facts and I'm in over my head, so I'm going to shift the focus by accusing the other side of simply being irrational."