The progressive problem is not a problem of performance -- progressivism will never be efficient economically as we think of economics and efficiency -- you can't have low taxes, economic freedom AND progressivism. In the 60s when I was a part of the yippie movement, we didn't pretend to be enlightened statist Hayekians -- we called for radical change. I eventually realized the emptiness of socialist ideology and transformed into Old Right libertarianism characterized by Murray Rothbard, Frank Chodorov, Roy Childs, Jay Albert Nock and other old-style libertarians. But, most of the Left during that time, especially after Kent State, began working inside the system to create progressive change. As time went on, and we went through the Reagan/Thatcher Revolution, many self-styled "liberals" hid their agenda rather than explicate their ideology. Now, we see movements such as "no-labels", and we constantly hear the call for anti-ideological pragmatism. Progressives reared their head for minute, then ducked.
For progressives and many modern liberals this is a cop-out. As long as liberals and progressives hide their ideology in obscurantism, the public will continue their scepticism when image-makers frame Obama as a centrist or Cass Sunstein as a type of libertarian/free marketer. Pracitically every leader on the Left puts forth a public image of pragmatic centrism, statist only in that safety nets, clean air, unpolluted water and middle class advancement are essential -- therefore they reluctantly support an interventionist government, but, otherwise they're just as free market and constitutionally oriented as anyone.
Progressives, and modern liberals who've supported the progressive agenda, have failed to inspire the public at large to accept the progressive ideology -- instead, they criticize and excoriate the Right as extremists, racists, corporate shills, enemies of the earth, etc. This isn't selling. I have a feeling that most modern liberals and moderates who never really accepted the progressive/socialist radical ideology are having second thoughts, but they have created such a conflict with the Right, they have no where to turn. True progressives are becoming frustrated because their ploy to change the system from within by disguising themselves as centrist, technocratic pragmatists is now being seriously challenged, and they can't come out and state the true nature of the progressive agenda -- that it will entail economic stagnation, central planning, more direct redistribution, a lowering of our standard of living and much more social engineering -- progressives haven't stated the truth publically concerning what a progressive America will look like.
Among themselves, progressives talk about social justice in radical terms, but their leaders in government only allude to the agenda and attempt to incrementally slip policies and regulations in as if it's nothing radical. In order for progressives to make any advances going forward, they'll have to be honest about their intentions -- limited government and progressivism don't mix -- a free market and central planning don't mix -- individual self-governance within the rule of law and social engineering don't mix.
In 2008, many progressives believed that through Obama they could come out of the closet, but the Tea Party reaction caused a serious dampening effect on the progressive agenda, and Obama defensively disguised himself as a centrist pragmatist. Now progressives have to decide if they're going to stand tall and fly their true colors -- liberals and moderates have to decide if they're going to continue to compomise with the progressive agenda, allowing it to advance, just more slowly -- and then the American people are going to have to decide what type of government they want. The political games are coming to end.