It may not be “labelling” so much as issue framing. One well-respected liberal analyst, George Lakoff, a linguistics professor at UC Berkley, believes the Republicans have successfully “dicatated the terms of national debate” by framing issues in such a way as to make their own postions seem the natural or moral positions, and all others to be wrong or immoral. (See the interview here in UC Berkley News where Lakoff expounds on the topic.)
One should be aware that Lakoff’s views on this subject are not universally accepted among political observers (here’s an example from noted political blogster Kevin Drum critiquing Lakoff), but it seems inarguable that the GOP has developed both the media infrastructure and the party discipline necessary to get their message out in a unified way. And that’s probably the key difference in effectiveness between the major parties at this point.
Being a liberal, I believe the Democratic positions on most issues -in general- are both better grounded in practical knowledge and fairer, wiser approaches to public policy. However, the public debate on issues in this country is not based on practical grounding or on forward thinking policy; it’s based on appeal to basic morality. Republicans win this public debate because they describe each issue in simple phrasing which goes right to middle America’s moral center, and they follow the phrasebook in lockstep with each other. So what if the results -and even in many cases the intent- of their policies go against middle American moral beliefs in a strong middle class, compassion for the disadvantaged, good stewardship of the land, minimum government intrusion into privacy and equal opportunity? It doesn’t matter, because that’s all background, and invisible to the casual consumer of the Republican message.
One practical course left to the Dems would be to follow the strategies of the “Gingrich revolution”, and be actively obstructionist to this President in all things while unifying behind party talking points which appeal to that American moral center in simplistic and often disingenuous terms. It’s a nasty way to pursue politics, and frankly it plays much more to conservative strengths than to liberal strengths. (Not a put-down of conservatives. It’s just more in the nature of conservatism to pursue winner-take-all strategies.) However, we’re fighting against a quarter-century of concerted Republican efforts to gain undisputed power; power they unabashedly want to use to institutionalize an antidemocratic and notably elitist political landscape.
It would be nice if we had a political dialogue in this country in which the many great strengths of conservative political philosophy (caution, responsibility, fairness, honesty…) contributed to strong and vital small-“r” republican governance. But we don’t have that kind of dialogue. We may have to destroy the Republican party in order to save it. ( 
) --But that’s a bit more palatable to me than the GOP strategy, which seems to be to destroy the Democratic party in order to scatter its bones, rip out its grass roots and salt the earth where it stood.
A different strategy (and the one I prefer) would be to oppose and highlight only the more extreme political gambits of this second term administration (and you know they’re coming; “public mandate” and all that) while pushing coherent alternative messages to the public. Unified opposition by the Democrats to single-issue right wing judicial appointments, to privatization of Social Security, to anti-choice efforts and to arrogant and unilateral foreign policy initiatives must be presented in unequivocal language which must “frame the issue” in a way that’s consistent with liberal ideals. No obstructionism without a very public display of opposition presented in absolute moral terms. Complete behind the scenes cooperation in all other legislative efforts, even when compromise results in conservative “victories”. The small battles don’t matter. Only political capital matters.
It would be nice if this second strategy were accompanied by avoidance of pork barrel politics, but one can only ask so much I suppose.
