Such perversions are common in multi-party systems where the leader of the country is elected not by direct vote but by a working majority of the country's national legislature. Sometimes compromise between two or more disparate parties can produce good policy. That seems to be the case in England. Eventually, however, it will almost always result in a strangled government. The horrible example is Israel. Right now the Israeli Knesset contains twelve different parties. Kadima, which wants a peaceful accommodation with the Palestinians, has the most seats, 28, but its leader, Tzipi Livni, could not assemble a ruling coalition. The more hard-line Likud party, with 27 seats, was able to put together a coalition with the Labor party to its left and two smaller parties to its right. The result is a kind of paralysis affecting the peace process and double-talk about settlements.
Even in the United States where the leader is elected directly, though state by state, a third party can distort the electorate's will. In 2000, Al Gore received more votes than George W. Bush but lost the presidency because the Green Party with Ralph Nader tipped Florida to Bush. (At least, that's what a slim majority of the Supreme Court ruled.) Of course, there were other reasons Gore lost as well--he ran a lousy campaign for one--but without the presence of the Green Party, he would have been elected.
People who feel the major parties do not sufficiently represent their views--sometimes on a single issue, such as the environment, or legalizing marijuana--often organize a third party. They may raise their issue, and represent a threat to one of the major parties, but the result is to throw the election to the party with which they least agree. That's why third party candidates often try to make the case that there is little or no difference between the two major parties. Nader argued that in 2000, but eight years of George W. Bush have surely demonstrated how wrong he was.
A two-party system is inherently centrist, but it is also stable. In a general election it resists the right as well as the left. The job of progressives, then, is to move the center. The Christian conservative movement showed how back in the 1980s. Rather than creating a party to compete with Republicans for conservative votes, they infiltrated the Republican Party itself. They were so successful that what were once moderate Republican issues--health care reform, for example, (the Democratic proposal that barely passed this year was, it has been observed, more conservative than the proposal put forth by Richard Nixon)--are now denounced by many Republicans as extreme. Indeed, Arlen Specter, one of the few remaining moderate Republicans had to switch his allegiance to the Democrats, only to lose his primary bid in Pennsylvania.
Now the Tea Partiers are pulling the Republicans towards a libertarian stance and doing it not by starting an actual party but by independent pressure, like someone coming upon a tug-of-war in progress and adding their pull.
From Teddy Roosevelt's Progressive Party in 1912 to Ross Perot's two candidacies in '92 and '96, and the Green Party with Ralph Nader in 2000 important issues were raised and debated, but the electoral effect was to tip the result to the candidate that least represented the views of the insurgent party. They did not have any lasting effect on the party to which they were closest in the ensuing election. The reason is that there are more votes up for grabs in the political center than there are on either extreme. What's more, a vote taken from the other party is as good as two votes while a vote garnered from a third party adherent is worth only one.
So, frustrating as it may be, let's give a cheer for the two-party system.