The thing about a two-party system is that it is not whether you win or lose but how you play the game (with apologies to moondog for wresting the old saw back to its original form.) As long as the two sides 1) maintain the conflict and 2) restrict it to each other, whichever one is currently out of power knows it must inevitably regain power by default when votes get sick of the current ruling party.

It is a pretty horrible recipe for accomplishing ANYTHING, because as soon as one party becomes the minority preventing those accomplishments (which would be to the majoritys credit) becomes its raison d'etre. National success/failure naturally (if seldom accurately) reflects most on the majority. National accomplishments further diminish the minority while national failure reverses its fortunes. Among the many things Romney and Kerry shared (definitely not including party) was dismay at a mild economic rebound that benefited the nation but doomed their campaigns. A nation with high unemployment and debt saw economic improvement, yet its would-be leaders—both the Dem then and the Republican now—denied and dismissed it BECAUSE IT HURT THEIR CAREERS.

So Ol' George was more or less right for the right reasons, but to retool another old saw, I submit that the cure for factionalisms ills is more factionalism. That breaks the log jam, because another viable party—even ONE—precludes the other two simply sniping at each other and taking turns doing nothing with the reins of power indefinitely.

The biggest evidence of that is negative campaigning. When there are only two options it is much easier (and safer) to demonize ones sole opposition than to take the risk of stating specific policy positions that may or may not be popular. The old addition by subtraction game; it is much easier to tear down an opponent than build up ones self. Of course, the traditional danger of mud-slinging is blowback, but in a two-party system one only needs to ensure they get more mud on their opponent than themselves to finish ahead of the game. Even one additional candidate changes that though, because if Candidate A publicly excoriates Candidate B but looks like an ass doing it, the clear winner is Candidate C by avoiding the whole fracass. Suddenly going negative is no longer enough: Winning demands constructive policies.