A well-funded, faux-reformist group known as Americans Elect is promoting a third party presidential candidacy and anticipates qualifying its candidate to be on the ballot in nearly all states. It is doing this by collecting millions of petition signatures, over 2.2 million so far, taking advantage of voter frustration with political blockage in Washington. The actual candidate will be decided later, by Internet Convention. Despite the superficial populism, just about everything about this exercise is misguided. For starters, consider the premise that sensible centrism starts with budget balance. The storyline is that the obstacle to economic recovery is the budget deficit, prevented by partisan extremism. If only the left would agree to cutting social programs like Social Security and the right would accept raising taxes, fiscal responsibility and recovery would ensue. But fiscal tightening during a deep slump would retard the recovery. The centrists get the cause and effect backwards. The recession caused the deficit, not vice versa. Cut the deficit while the economy is still shaky, and you abort a fragile recovery. If anything, the economy needs a lot more public investment to jump start job creation and put income in workers’ pockets. The last thing it needs is high-minded austerity. Social Security is in fine shape for decades, and Medicare reform needs to be part of broader healthcare reform, meaning national health insurance. Social insurance has little to do with the the current or near-term deficit. As for the rest of federal domestic spending, it’s already at its lowest share of GDP since the Eisenhower years. You can see the allure of the wrong kind of post-partisan centrism in Democratic Senator Ron Wyden’s entirely misguided alliance with Republican Representative Paul Ryan to convert Medicare into a voucher after 2022. If the voucher doesn’t pay for decent insurance, the elderly are on their own. Voucherization of Medicare takes us further away from real reform. The quest for a centrist third party alternative also misstates why Washington is blocked. The storyline is one of symmetrical extremism and refusal to compromise on the part of Republicans and Democrats alike. Says Americans Elect’s website, “you have the power to help break gridlock and change politics as usual. No special interest. No agendas. Country before party.” But, as anyone who hasn’t spent the last three decades on Jupiter must know, Democrats have spent the era since Jimmy Carter moving to the middle of the spectrum on a broad range of pocketbook and national security issues. Only on tolerance issues has the presidential party remained progressive. So we already have a centrist party. It’s called the presidential Democratic Party. President Obama kept splitting the difference with Republicans, and then splitting the difference again, and had to almost be bodily restrained by such Bolsheviks as Sen. Harry Reid lest Obama give away the store on Medicare and Social Security. Republicans during this period have both moved further to the right ideologically, and have become more obstructionist tactically. They have refused to pass routine legislation such as extension of national debt authority. Ordinary bills are now subjected to Senate filibusters. If they don’t like a federal agency like the consumer financial protection bureau or the National Labor Relations Board, they won’t confirm its nominees. If they don’t like duly enacted legislation like the Affordable Care Act, they vow to destroy it. The Supreme Court has become a partisan organ. This pattern of extremist obstruction by a major party is something unknown in American politics since the pre-Civil War battles over slavery. So anybody who blames both parties equally for the government’s failure to address urgent national needs is simply delusional. This unfortunately includes the New York Times‘ Tom Friedman, who thinks Americans Elect is an idea whose time has come. It includes center-right Democrats such as Will Marshall of the Progressive Policy Institute and center-right Republicans such as Mark McKinnon, late of the Bush Administration. These worthies somehow believe that if the next president is even more center-right on economic issues than those dangerous radicals like Tim Geithner, Republicans in Congress will somehow relent and learn the art of compromise. The thing is funded mostly by hedge fund gazillionaires. In fact, the chief operating officer of Americans Elect, Elliot L. Ackerman, got a $30 million dollar gift from his father, Wall Streeter Peter Ackerman, to finance this exercise in Internet populism. Thanks, Dad. As my colleague Paul Starr has observed, sometimes self-described moderates can also be zealous and dangerous fanatics. With Americans Elect creating a placeholder slot on the 2012 presidential ballot in most states, a critical election gets yet another wild card. If someone like Ron Paul or Donald Trump decides to make a go of it, then the third party will siphon mostly Republican votes and help re-elect Obama. If Michael Bloomberg gets the itch, he will likely siphon off more socially liberal independent votes that would otherwise go to Barack Obama, and help the Republican win. And in this age of televised political celebrity, there is even an outside chance that the latest celebrity flavor of the day could be elected. Trump as the ultimate political survivor; Bloomberg finds another office to buy. Note that this hedge-fund-spawned third party is most likely to attract self-financing billionaires. This is one hell of an exercise in the people taking back their politics. In a momentous election year, we are very likely to see two parallel political campaigns. In the main arena, Barack Obama, the Democrat, will duke it out with Newt Gingrich or Mitt Romney. But there will also be a shadow arena, in which Republican operatives try to make sure that the third party nomination goes to a quasi-Democrat, the better to draw off Democratic votes; and Democratic operatives try to do the opposite. So we have wrongheaded ideology, married to a misguided diagnosis of what ails America, yoked to a perverse politics. Just about what you’d expect of hedge-fund billionaires meddling in electoral reform. Robert Kuttner is co-Editor of The American and a senior fellow at Demos. His latest book is A Presidency in Peril. This article was originally published by The Huffington Post.