Avoidance of reality with Conservative in impasse, unfortunately (8)
I believe the answer is:
escapism
'avoidance of reality' is the definition.
(escaping from reality)
'conservative in impasse unfortunately' is the wordplay.
'conservative' becomes 'C' (UK political abbreviation).
'in' means one lot of letters goes inside another.
'unfortunately' is an anagram indicator (a bad or unfortunate spelling).
'impasse' is an anagram of 'esapism'.
'c' going inside 'esapism' is 'ESCAPISM'.
'with' is the link.
(Other definitions for escapism that I've seen before include "Inclination to retreat from reality" , "The avoidance of reality by absorbing the mind in fantasy" , "Absorbtion of mind in fantasy like Walter Mitty" , "Mass epic (anag.)" , "Avoiding the actual" .)