The brilliant libertarian legal scholar Randy Barnett (who first converted me to anarchism during an amazing presentation at an Institute for Humane Studies summer seminar in 1988) muses over at Volokh.com on whether the very existence of the Libertarian Party is siphoning off libertarian political activists from the major parties, to the ultimate detriment of the libertarian cause.
His first post on the topic here; he revisits the topic in reaction to some blogworld chatter about it here, with an illuminating sports metaphor that ultimately encourages libertarian political activists to focus on libertarian candidates and their fate, not the fate of a purist party bearing the libertarian label:
Like other Americans, however, many libertarians think of political parties like sports teams. They want their own team to root for and cannot root for the other teams. Voting Libertarian gives them psychological satisfaction, while in the aggregate diminishing their political impact.
Libertarians should stop thinking of parties as teams and think of them instead as the playoffs. In NFL football terms, The Democrats are the AFC and the Republicans he NFC. To get into the Superbowl, you have to survive the season and the playoffs in your respective conference. In effect, Libertarians want to form their own league which no one but themselves is interested in watching. And they assure themselves of never making the playoffs much less the Superbowl.