One evening in October 2008, the Democrat candidate for president will stand up in a convention hall in Denver. As they speak, hundreds of thousands of American troops will remain in Iraq. And barely a week prior to the convention’s opening, a television audience of more than a billion people will have watched the closing of the Beijing Olympics – the greatest symbol yet of a world shaken by the power of globalisation. The speech will be a critical moment in what is already certain to be the most expensive and intense election in human history. It is a campaign that the Democrats can ill afford to lose.

At the last election in 2004, informed opinion strongly tipped the Democrats to win. In one incident, a journalist asked a senior Democrat adviser what John Kerry had to do to beat George W Bush. ‘Easy,’ came the reply, ‘keep breathing’. Bush was a flawed, blundering president with a legacy amounting to little more than a nasty recession and a hopeless war. The American people might have made a mistake once. Surely they wouldn’t again?

Then, as now, the conventional wisdom goes that the Democrats will find 2008 easier to win than lose. Bush might not be running, but the anchor of his unpopularity will be a significant hindrance to any Republican candidate. And, from the disaster in Iraq to an economy increasingly seen not to be benefiting ordinary Americans, the record of conservative governance could hardly be worse.

On the other side, things are looking up. In Hillary Clinton, Barack Obama and John Edwards the Democrats have found three talented and electable candidates. The American electorate seems ready for change. And polls suggest that voters now agree with progressives on issues ranging from Iraq and the economy to healthcare, and even global warming.

The electoral mathematics also look promising. The Democrats lost the last two elections, but won 49 per cent of the vote on both occasions. Their candidate this time merely must win every state taken by Kerry, and add one or two more. With Ohio in particular trending strongly towards the Democrats, an electoral college majority looks eminently achievable.

Victory, however, is far from inevitable. Current optimism in Democrat circles is in part a feel-good illusion caused by the party’s recent victory in November’s congressional elections; a victory due more to competent organisation and discredited opponents than anything particularly new and innovative from the party itself.

Only last summer, the Democrat establishment was engaging in a collective bout of political soul-searching. They found themselves at a low electoral ebb, with less political power than at any time since the administration of Herbert Hoover. Their party seemed paralysed, with neither an analysis of, nor a prescription to improve, a fast-changing world. As Matt Bai, an essayist for the New York Times, put it: ‘Underneath all the now-tired mantras, there remains a vacuum at the core of the party, an absence of any transformative worldview for the century unfurling before us.’

Trying to find such a worldview, two young Democratic operatives, Andrei Cherny and Kenneth Bayer, launched Democracy, a new policy journal. At the journal’s launch they noted that ‘something happens to a political party when it is not just out of power but has had to play on the home field of its opponents for a generation: it loses faith in itself and becomes scared.’ The Democrats, they argued, lacked the ‘big ideas’ needed forge a new electoral majority.
Yet the issues that vexed Cherny, Bayer and other Democrats nine months ago have not gone away. And nowhere is this lack of vision more clear than on the twin challenges of our time: the security and economic aspects of globalisation.

From the situation in the Middle East, to terrorism and the rise of China, the coming election will turn on America’s role in the world. Part of this will mean dealing with the legacy of the Iraq war, now certain to remain high up the agenda as a consequence of President Bush’s ‘surge’ policy. This escalation makes it more difficult for Republicans, and in particular Senator John McCain, to escape their support for an unpopular war. Yet, beneath a façade of unity, the Democrats remain deeply and passionately divided over what to do next. And, perhaps even more importantly, the Republicans have won every election in a generation in which national security featured prominently.

Iraq, however, only disguises a deeper confusion over foreign policy. It remains far from clear how a Democrat president would better manage counter-terrorism policy, turn back the nuclear ambitions of Iran or prepare for a global health epidemic. Ultimately, the party still lacks a convincing narrative about America’s role in the world that is distinct and different from that offered by President Bush.

The economic challenges brought about by globalisation are equally daunting. Increased competition and the entry of China into the global economy, in particular, are altering the fundamentals of the American economy. Recent strong growth in productivity and GDP growth has been accompanied only by weak job creation. Corporate profits have soared, while the share of national income being paid to workers has sunk to its lowest since the Great Depression.

The result has been falling wages, stagnant median incomes and a growing public backlash against globalisation. Indeed, income inequality is now so stark that even President Bush has begun to talk about it. He noted in his recent State of the Union address that ‘some of our citizens worry about the fact that our dynamic economy is leaving working people behind,’ and admitted that ‘income inequality is real’.

These twin strategic challenges clearly demand imaginative responses. As yet, however, there is little evidence that aspirant Democrat candidates, overly cautious after a generation on the defensive, will soon unveil the bold policies needed.

Obama’s recent book outlining his political philosophy, while lucid and thoughtful, was conspicuously weak on bold policy suggestions. Hillary Clinton, meanwhile, put forward policy suggestions as part of the Democratic Leadership Council’s American Dream Initiative, whose caution served only to make Obama look radical.

The risk for the Democrats is that instead of proposing universal healthcare, they propose universal healthcare for children only; instead of a wide-ranging carbon tax to tackle climate change, there will be only ethanol tax credits; and instead of new, visionary ideas to tackle the inequities created by globalisation, there will be only minor training schemes and trade adjustment assistance.

Ultimately, the world badly needs a progressive president who can rebuild support for a just globalisation, reverse the mistakes of neo-conservative foreign policy, and begin to assert American leadership on climate change and other issues. Yet the American people need more than a reason to vote against the Republicans. They need a reason to vote for the Democrats, and a candidate who can articulate a new governing philosophy sufficient to turn back the conservative tide. And faced with challenges of this magnitude, a cautious, defensive approach is the surest path to a third defeat.