As Jefferson said (in 1820): "To consider the judges as the ultimate arbiters of all constitutional questions [is] a very dangerous doctrine indeed, and one which would place us under the despotism of an oligarchy. Our judges are as honest as other men, and not more so. They have, with others, the same passions for party, for power, and the privilege of their corps. Their maxim is 'boni judicis est ainpliare jurisdictionem,' and their power the more dangerous as they are in once for life."Jefferson was like almost all Whigs (the philosophy, not the parties) overly enamored of the legislative branch. (Bagehot's sovereignty of Parliament was the end point of this trend). Supreme Court tenure is the closest thing we have to political property rights and the resulting long time horizons in this country. It is also, at the risk of sounding parochial, a group of highly trained and experienced professionals. Would you rather have experienced software engineers writing -- or at least reviewing -- the code that runs on your computer, or bunch of frat boys who happen to speak smoothly and look good on TV?
With the possible exception of the independent agencies, the federal judiciary is the only branch with anything resembling long term political preferences. This is reflected, for example, in the very high quality and care put into their opinions, compared to the typical ideological quackery and other ignorant nonsense that generally passes for political debate in the Congress and the mass media and beyond.
The Court, it is true, has like the executive and legislative branches eventually succumbed to every long-term political trend. But it has severely attenuated many of the political fads most dangerous to liberty.
The current popularity (and abuse) of this Jefferson quote stems from a propaganda movement Jefferson would have abhorred: to invest our executive branch with arbitrary powers to act unchecked by our Constitution. The hot air in this whole debate about "who decides what is constitutional" also reflects the general ignorance about how separation of powers works.
To summarize separation of powers in one sentence: it is a formal system of mutual veto. Under our corporate charter here in the U.S., our Constitution, Congress gets a full veto at will because it must originate legislation. The President gets a partial veto at will. The Supreme Court's veto by contrast can only be of a very specific and careful kind. It only gets to decide what it has to decide when asked to decide a case in the face of conflicting laws. It must decide whether a statute conflicts with our corporate charter, the Constitution. In such cases the charter must prevail. Articles of incorporation trump by-laws. And it must justify such a ruling in a legally professional opinion.
Nothing at all stops the Congress or the President from vetoing legislation because they believe it to be unconstitutional, and indeed this was quite normal in the first century of our Republic to have long debates about the meaning of the Constitution in the halls of Congress. This was long a habit, up to the 20th century, until Progressive legislators decided they didn't much understand or care for that archaic charter. Even Congressional supporters of constitutionalism rhetorically shifted the Reform-and-Jingo media flack they got from arguing that a desired law violates our charter to the relatively immune Court. (This was recently reflected in Senator Spector voting for the Military Commissions Act despite expressing his belief that it was unconstitutional -- the Court will take care of that, he said).
It is profoundly unfortunate that two branches have abdicated their responsibilities to our Charter, but the solution is hardly to strip the responsibility from the only remaining branch that still to some extent exercises it. What is most extremely dangerous to liberty for the executive to do is ignore such a Court opinion and proceed to execute a law that the Court has carefully explained violates our Constitution. This has happened to a disturbingly large degree in the current Bush Administration, for example with its warrantless NSA mass-surveillance pgoram. It most recently and famously occurred at a local level, where the Los Angeles County Sheriff released media celebrity Paris Hilton from jail in violation of her judicial sentence. She had been punished by the judge according to law for her repeated breaking of drunk driving and probation laws. This is one sheriff who should himself face some jailtime if we still live under "the rule of law, rather than of men," as the founders of our country intended.
This kind of arbitrary executive power, but of a ubiquitous nature rather than as a temporary response to national emergency or the quirk of a celebrity-worshipping (or bribed?) sheriff, is what the current criticisms of the Court, if they prevail, will result in. This outcome would destroy one of the few remaining controls against arbitrary power we have left.