We do not wholly concede on the topic of vulgar economic populism, bc we understand that the social and economic repercussions of such policy would be disastrous. Even if one discounts morality, the same must be true on issues of social justice & civil rights.
Third Way's actual pitch is basically "we promise that you can avoid Real Damage if you just make these rhetorical sacrifices & disassociate yourself from Those People." I don't think that is at all correct.
In any case though, if you do make those big rhetorical sacrifices, the GOP will just keep saying "The Democrats are the party of [insert slur here]," and they will put you on the spot until you directly renounce the marginalized, not merely the "annoying" rhetoric that bugs the consultant class.