I think you nailed it. The only thing that will keep the Democrats out of power for elections to come is their knee-jerk distrust of the military, and their insane positions on national defense. The Clintons are smart enough to know that until the Democrat Party again becomes a party strong on national defense (as they were throughout the post-war era until George McGovern), they'll never win another national election. Since the Clintons have no convictions about anything, The Beast can easily morph into a super-hawk over the next four years.
Kerry has tried to blunt thin inherent party handicap with his "I served in Vietnam, don't-cha-know..", but it hasn't worked for him. There are those embarrassing comments he made in 1971 that he's never recanted that keep getting in his way.
I wondering about Kerry's choice in a VP and the Klintoons support of whoever that person may be. For instance, if it is Edwards and Kerry wins, Edwards could be President in 8 years.....Hitlery won't be able to wait him out. How will they destroy the VP choice??