Let me preface this by saying that I think having a third party oriented towards the interests and desires of people who live in cities would be totally, completely great.
> I don't see the political monoculture mentioned in any analysis about Baltimore, New York, St. Louis, Detroit, etc. These cities have been basically one party rule for fifty years (or more). If the police become too brutal or incentives become perverse, the party is not thrown out of office. If the mayor or council members are shown to be corrupt, the party is not thrown out of office. There's no real accountability.
This is off in a couple of ways. First, in cities where everyone avoids the Republican candidates, the real election is the primary. Or else you just save time and have a nonpartisan election. There are usually a number of points of view represented on the half dozen or so topics that city voters tend to care about.
More importantly, I think: corruption and culpability tends to cut across party lines in city and county government. As much as the two parties are very similar flavors at the state and national level, at the local level the differences just don't matter. You've got an office to fulfill, you've got people you need to work with, you've got corruption, and you are either an insider or an outsider. That is the distinction that matters, not party. People who play the game choose to be insiders because it's the only way you get anywhere. When corruption happens, Democrats and Republicans all get paid, or suffer if they do not conform.
In other words, the traditional party discipline dynamic tends to get replaced by a whole other form of discipline. brownbat mentioned a "network of insiders" below, that's what I'm talking about.
> To some degree, the problem is the two-party system. If the district is liberal (as is the case in Baltimore), there needs to be at least two credible liberal alternatives.
O'Malley was up against six other people in the Democratic primary in Baltimore in 1999. There were a diversity of views represented. The views probably all tended to suck, but I don't think that has as much to do with party organization as you think it does.