I also think his description of British-style policy-making is interesting, because it puts into relief the different approaches that are available, and how our system isn't well-suited for any of them:
In many places, I think it’s taken for granted that this is how progress is made. In the UK, Labour never wins a definitive victory against the Conservatives and vice versa. Nor is there ever a “grand bargain.” But over the long term, public policy reflects both conservative and progressive ideas because people inspired by those ideas take turns trying to govern the country in a way that pleases the voters.What Matt's describing here is a system where long-term policy is decided through, essentially, competition in the political marketplace. Two sides tugging as hard as they can in opposite directions, and the solution ends up falling somewhere in the middle.
At the other extreme, there's the benevolent dictator model. Whoever runs the country sits down, attempts to synthesize a bunch of competing ideas, and ultimately come up with a single solution that represents, as much as possible, the best of both worlds.
Both approaches have something to be said for them. The former is perhaps more traditionally democratic, while the latter is a certainly less contentious and more efficient way to find something approximating an optimum solution -- assuming the people in charge know what they're doing.
But what's interesting here isn't the tension between these abstract ideas, but how that tension manifests itself in the US government.
The Republicans play the government game as if we were living in a purely competitive, majoritarian system -- the British system, more or less. They rarely or never compromise, they pursue their few motivating principles to the point of absurdity and excess, and generally behave like diehard partisan demagogues whenever they get the chance.
The Democrats, on the other hand, govern like the Kings of America that they all wish they were. Very often, the Democratic proposal for a particular policy problem will include ideas that run counter to the most basic demands of the Democratic base (Medicare cuts, for instance). That's because many Democrat leaders acknowledge that unyielding pursuit of their party's interests doesn't necessary create optimal policy outcomes, and those acknowledgments find their way into policy debates.
The result is that we're stuck with an absolutist Republican Party that would be a strong counterweight to a Democratic Party -- if the Democratic had any interest in absolutism or demagoguery, which it rarely does. It's little surprise, then, that policy debates are perpetually getting dragged to the right.
The second and more fundamental point I'd make is that the US federal government is not designed in a way that facilitates either of these systems. As the Republicans are finding out in the debt ceiling debate, an utter refusal to compromise quickly goes nowhere, because the system includes a multitude of veto points. On the other hand, because of those same veto points, an intransigent minority can easily frustrate any and all attempts to carefully construct the optimal solution to any problem. Instead, our political process is irrational and chaotic, and progress is only possible in moments of political serendipity.