Well, you're spot-on about the limited utility of electoral politics. I live in New York, and everything is just ossified. Four incumbents got defeated last year in a state legislature of 200-odd people, and it was considered an earthshaking year.
And in New York, the Democrats are completely controlled by the downstate party establishment, and they don't do much for the party upstate except enable the numbnut, no-talent sloppy seconds who have become Democratic mayors and the odd county executive, who keep presiding passively over the area's economic decline. If you want a good look at how Democrats hover around the fire of the status quo while pretending they are progressives who care about all Americans, look no further than New York City. They have no desire to lead, just to wallow in their own little lucrative world. They can't even lead their own state out of the abyss. I was reasonably enthusiastic about Spitzer being a bit of a rebel but my enthusiasm is starting to fade. He's coasting.
You do need movements focused on concrete embodiments of the issues, but those are hard to come by. People would rather flee than fight. We have an interesting (to say the least) situation in upstate New York with opposition to the New York Regional Interconnect (NYRI) project, a monstrous 200-mile power line that's going to kill about 40 small communities. The Greens are pretty vocal about it (and Maurice Hinchey), but interestingly so are the traditional anti-downstate Republican/independents. So there are some odd bedfellows.
Democrats (including Spitzer) are reluctant to take too strong a stance against it. After all, those 40 communities are in line to be economically exterminated in order to make New York City bigger and shinier, and the Democrats are all creatures of the City. You cannot expect too much from the Democrats. In the end, they will give in (the power company has run crying to the federal government to have 200 miles of upstate NY taken by eminent domain as a "National Energy Corridor"). Schumer, Hillary, all of them. They will gladly sell some of their constituents' homes out from under them (or stand by while it happens) if it means they can continue in their hegemony.
In any case, I'm not really explaining the NYRI situation that well. The company that is pushing this is shadowy, arrogant and has an Enron-like whiff coming off it. It's just foul, and the Bush Administration is behind it. The larger issues lying behind the fight have to do with the decay of social contracts, the question of sustainable energy generation and transmission, sustainable growth, etc.
It's very specific, even geographically centered, issues like these that are prime coalescing points for greater movements. Indeed, no one can remember such a wide coalition of upstaters - not just from rural towns; there is at least one city, Utica, involved -- trying to form a collective defense movement for their communities over 200 miles of space. But do people want to pay attention if the movement-creators are "the little guys"? I'm not sure. There is still a self-flattering that goes on among alleged progressives that says they're doing OK if they vote for the "right party." They are unable to see what's happening in their own back yard.
But if the people who are forming real, on-the-ground movements -- without permission from the Democratic Party, or the blogeoisie -- endure and find ways to meet up with each other (for instance, as someone interested in anti-NYRI efforts, I have been in touch with other folks in Appalachia who are fighting similar battles to come against the federal government)... then new, actual networks of actual action can form pretty much under the radar of the parties. Then, election politics becomes just one tool in the toolbag. But first I think a lot of actual movement work needs to be done.