McCain is spouting all this nonsense because, as he hardly even bothers to deny, he'd like to get the Republican nomination four years from now; his speech last night was part of his ongoing audition. I wish him well. If he got the nomination, I'd probably vote for him. (American politics desperately needs somebody to transform the GOP from a patronage party for lobbyists and the rich into a party that advances some semblance of the national interest.)
American politics might need this, but putting McCain in office is no way to go about it. There's too much at stake in a presidential election, quite frankly; the only way towards progressivism is to beat back Republican officeholders, one by one. And most smart conservatives will think the same about Democrats.
Now this state of affairs poses quite the little conundrum. Let's say I'm a conservative, and I don't like George Bush. The alternative, alas, is Kerry, a starkly unacceptable choice. So I shut up, stick with my candidate, and deal with the cronyism, the free-spending, the botched wars. There's just no way to fine tune your party's candidate.
The primary system should, in theory, allow a party to swap out its candidates in favor of a slightly better one. But given that the presidency is such a desperate position – so powerful and so precarious -- the odds that an incumbent will be swapped out in the primary are slim to none. And indeed, no incumbent has ever lost his re-election primary, at least not in modern times. Alternatively, we could hold national elections every year, in which case, Republicans and wouldn't be afraid to cast aside, say, someone like Bush for someone like McCain, because if it didn't work, the worst you suffer is one year under a Democrat. (Even two years might work.) But fat chance of that, as they say.
(Note that all this also helps explain why third parties can never really succeed in the U.S. -- no one wants to risk the presidency, which is all-or-nothing, on a quixotic third party movement. Or at least, people realize the stakes involved pretty quickly -- Republicans in 1912, Democrats in 2000.)