Conventional wisdom holds that the way to create a third party is to have a lot of people at the left or right ends of the political spectrum gather together at the grass roots level, hold a convention, develop a platform and try to get people elected to city councils and the school board. This is essentially the approach which has been used by the two most persistent third parties in the United States, the Greens and the Libertarians. The conventional wisdom is wrong.
If one must create a third party, the way to do it is the have a mass defection of a significant number of people who already hold elective office in geographic areas where there is a single dominant party. I discuss why this is so and why it is worth at least thinking about below.
Poly Sci 101 in a Nutshell
The United States has a single member district plurality voting system. This means that candidates compete for a single elected office in the general election, and whoever gets the most votes in each race wins, even if they get less than 50% of the vote.
This system has a strong bias towards a two party system. If you think of voters as basically left wing and right wing, then whichever side of the political spectrum has fewer parties has the best chance of winning. If the right wing has two parties and the left wing has four, then the right wing splits 50% of the vote among two parties, an average of 25%, while the left wing splits 50% of the vote among four parties, an average of 12.5%. This means that a slighly better than average right wing party would have an edge over even a much better than average left wing party.
Political insiders in the United States noticed this and decided that it was best to compete with their political enemies rather than their political friends, so they created the primary system. With political primaries, left wing candidates compete to find a single champion, and right wing candidates do them same. As a result, elections more or less reflect the right-left balance of the district, rather than the number of parties on each side of the divide.
It isn't that a single member district plurality voting system has to produce two parties for the system as a whole. Canada is a good example of an alternative. It has more or less the same voting system as the United States (except that its primaries are private party member only affairs), but while it has multiple parties, not all parties are viable in all regions. The Parti Quebeqois, for example, has persisted because the various right wing and center-right parties have failed to thrive in Quebec. For a long time, at least, the NDP was stronger in the West, while the Liberal party remained dominant in Ontario.
The other way you can get a three party system that can persist for a while, although it isn't stable, is to have a party of the left, a party of the right, and a party that draws more or less equally from the left and the right, so that there is no clear way to collapse the system into a two party system.
But, in a system where two viable parties in a given district is the only really viable option, and where three parties in a given district is the only other moderately stable situation, a new party that caters primarily to the far left or far right can't make it. If it is successful it undermines its allies. And, since it is at a political extreme, it has an extremely hard time marshalling a plurality to win even a single district.
Add to this mix the fact that incumbents, regardless of party, have an edge in our system (for reasons to complex to discuss in this post, but something that is empirically clear). Politicians like Jim Jeffords and Bernie Sanders are viable despite the lack of the usual party label because they have the power of incumbency.
Application to Third Party Formation
The best way to start a viable third party, then, is to start with a critical mass of people who already hold office. They have proven their ability to obtain a plurality vote and have the extra edge of the incumbency factor which has been repeatedly shown to be sufficient to overcome a switch in party labels. If they act as a group, they can't easily be collapsed into one legislative party or another as a "de facto" member, and they can have real power as long as they have the numbers to deprive either existing party of a legislative majority. If the non-aligned group can't deny either party a legislative majority, they are pretty much irrelevant. If they can if they hold together, then they are a force to be reckoned with.
This also works best in districts where one party or the other is dominant. If a district compares the blue brand and the red brand and finds one brand or the other to be better by overwhelming margins, then a purple brand can move in comfortable that it will get most of its votes from the brand that has the most support already. If the blue brand is weak, and the purple brand can move in and prove stronger than the blue one, than the natural tendency of the system to produce two strong parties in any given district starts to work in its favor, rather than against it.
The obvious way to create a third party in the United States federal government context, if you were going to create one, would be to have a lot of House and Senate moderates defect to it.
On the Democratic side in the Senate you'd look for Senators like Ben Nelson (NE), Ernest Hollings (SC), Robert Byrd (WV), Mark Pryor (AR), Blanche Lincoln (AR), Evan Bayh (IN), Kent Conrad (ND), Joe Liberman (CT), Mary Landrieu (LA), Max Baucus (MT), Tim Johnson (SD) and, of course, Ken Salazar (CO). Jim Jeffords (VT) would be another natural.
On the Republican side in the Senate you'd look for Senators like Lincoln Chafee (RI), Arlen Specter (PA), Olympia Snow (ME), Susan Collins (ME), Ted Stevens (AK), Lisa Murkowski (AK) and Gordon Smith (OR).
The House line up would be comparable.
On the Democratic side, you'd expect people like Collin Peterson (MN), John Tanner (TN), Lincoln Davis (TN), Tim Holden (PA), Mike McIntyre (NC), Rovbert Cramer (AL), Ike Skelton (MO), and Gene Taylor (MS).
On the Republican side, you'd expect people like Sherwood Boehlert (NY), Jim Leach (IA), Christopher Shays (CT), Rodney Alexander (LA), Nancy Johnson (CT), Robert Simmons (CT), Michael Castle (DE), Christopher Smith (NJ), Sue Kelly (NY) and Wayne Gilchrest (MD).
Basically, this new party would largely replace the Democratic party in many red districts where it could compete with Republicans unburdened by stands like Democratic party support for gun control, and would largely replace the Republican party in much of New England and the Mid-Atlantic where this new "Purple Party" would compete with Democrats free of religious right extremism. It would be a mix of Rockafeller Republicans and conservative Democrats.
What are the virtues of a third party?
I can't imagine that it is comfortable to be a Joe Lieberman or Ben Nelson in the Democratic party. The case of Jim Jeffords illustrated just how uncomfortable it was to be out of step with the party line in the Republican party. For moderates, in each party, a third party would mean enjoying the freedom to not constantly have your arm twisted by the party leadership to vote for bills you disagree with. The huge changes in voting patterns of people who've switched parties show just how real this pressure is for those members. Partisanship is routinely causing them to vote contrary to their own preferences. Also, as a moderate party, your party would, by itself, unconstrained by the other wings of your old parties, basically rule the country by siding with whichever other party you wished, and this kind of power would be a powerful draw. Instead of having slightly more than 50% of Congress pledged to a nutty theocratic agenda that can pass legislation, that might drop to 35% of Congress with little hope of achieving its legislative goals.
From the perspective of a progressive Democrat, there are two benefits.
First, you spend a great deal less time fighting over the soul of your own party. Your party platform does not have to be held hostage to swing voters in states like West Virginia, New Hampshire and Florida. You can have a common vision and push it in a spirit of common cause.
Second, in a true three party system, you need two out of the three parties to agree to get anything done. This kind of system leaves you with less power than a Democratic majority in Congress would. But, it also makes it much harder for the worst parts of the Republican agenda to get enacted, than it would be if there were a Republican majority and a Democratic minority, as there is now.
Republicans wouldn't be able to get their agenda enacted without widespread support in the moderate caucus. Democrats would be able to get their agenda considered without having it kept off the floor entirely by a Republican leadership with the power to bully the moderates in their party. And, Republican moderates (who tend to buckle more to party discipline than Democratic moderates) would start voting considerably more liberally than they did before.
It isn't an ideal option.
Winning majorities would be better, but if Democrats can't do this in 2006 after Republicans have seen their popularity tank, it is time to start considering alternatives. Neither Democrats nor Republicans would ever get majorities in the foreseeable future if a plan like this was adopted, and three way Presidential races, which would be far more volitile, would become the norm. But, such a three party system would halt Republican progress in many states where conservative Democrats are rapidly being replaced by conservative Republicans in red states, would mitigate the harm we face with narrow Republican dominance at the federal level, and would allow Democrats to more openly compete against the politicians who they need to maintain power but don't agree with in the current system. Rather than having to put up with the Joe Lieberman's of the world to maintain some hope of party control of Congress, Democrats could run a full fledged campaign with real Democrat against him without risking shooting themselves in the foot and putting Republicans in power.