With the Tea Party, the Republicans have an excellently-crafted, right-wing scare machine out there, designed to panic the left and make moderate Republicans, or even conservative Republicans with coherente messaging, look sane and reasonable. What's a good Democratic answer to this?
First of all, stop panicking.
Second of all, return to the Democratic core values. Get as specific as you want, but, a nice short-form version of this might be, "Reclaim the Great Society!" Specifically:
End the war(s)
Preserve Social Security
Health care for all
Fairer tax burden (notice this is hidden in the middle. Shhhh!!!!)
Environmental concerns
Ensure Medicare is safe
Preserve collective bargaining
...and so on.
Third of all, come up with a snazzy name for them. NOT a reaction to the Tea Party. Call them 99-percenters, for instance, after the 99 percent of us who don't own the entire universe.
Find some radical college students, socialist, whatever, who will show up at rallies, parade around with signs, protest at Capitol Buildings, whatever. Video them and put the videos on YouTube, Facebook, and twitter. Ignore conventional media, because they will ignore you, but have people prepped and ready to speak. Be relentlessly positive and nice about what a great country America is and how we don't want it to decay.
Finally, EVERY time someone says we can't afford it, we have to live within our means, or whatever, respond with something like, "Fine, let's start with making huge, global, corporations pay their fair share," and cap that with a quote about Boeing, GE, or Microsoft not paying taxes AT ALL. This way, we don't look like we're trying to shift the tax burden to the mythical struggling grocery store up the equally mythical street.
Keep the focus on this. EVERYTHING should be about how the mean, huge corporations are not having to pay taxes, and the burden falls too heavily on poor Mr. or Ms. Everyperson. It might be fun to make a remark about some people owning three homes, while others don't own one, but, upon reflection, that just sounds jealous. Also, be sure to highlight the great things those corporations are doing, but that you just "want it to be fair." If anyone argues with you, just return to the point, "So, are you saying you DON'T want corporations to pay their fair share?" If they say, "It's more complicated than that!" respond, "How?"
Americans are sticklers for fairness. Plus, there's a huge amount of resentment towards the aforesaid corporations out there. It would be nice if that resentment was used in a positive way.
Once the airwaves get flooded with this message, we can find sane, normal responsible Democrats who OF COURSE don't blame corporations for everything, and OF COURSE want America to be a good place for business, but "admire the energy and enthusiasm" of the 99-percenters, and agree they have a "grain of truth" in their comments - and use that to move their message a bit more to the left of center and give us some more breathing room.