Allowing for the manner in which their last two leaders have left the post, the most surprising aspect about the contest to take charge of the Liberal Democrats is that several candidates are reportedly interested in the position. Whether this is the triumph of optimism or of masochism is debatable. It was not very long ago that the party appeared on the verge of a genuine breakthrough. Tony Blair’s principled stance on Iraq had plainly cost the Labour Party a large number of votes while the Conservatives seemed determined to pursue a “core vote” strategy despite this costing them even more votes elsewhere. It was Charles Kennedy’s moment and he failed to make the most of it. A glimpse of the promised land of power was offered, then snatched away. Sir Menzies Campbell, unfortunately, happened to be at the helm as politics returned to normal.

The role of a third party in British politics can be not unlike that of the appendix in the human body. It would be strange if it disappeared, but for much of the time it is not clear why the organ exists and it can sometimes be the cause of deep discomfort. The basic question that the Liberal Democrats have to address in the coming two months is what they are for. Is it their purpose to be a pressure group, a think-tank, the conscience of the political class or a serious contender for national office? If they consider themselves contenders, then the party has to appreciate that it will not displace Labour or the Conservatives unless one of the pair engages in an improbable act of hara-kiri. The only realistic route to securing ministerial red boxes is as the coalition partner in the event of a hung Parliament. Any candidate to be leader who suggests otherwise is not being straight with members.

The candidates also should be blunt about the severity of the situation that the party is in. It has been squeezed by David Cameron’s willingness to address social issues and Gordon Brown’s signals to those who fell out of love with Mr Blair that he shares their pain. Even the most dynamic of Liberal Democrat leaders cannot transform their party’s prospects by being capable or tele-genic. The party has to pull off the difficult trick of being distinctive but not eccentric and then somehow orchestrate (or benefit from) some luck.

The stakes are extremely high. As the party acquired additional seats in 1997, 2001 and two years ago, it attracted a higher quality of younger politician to Westminster. These are, rightly, ambitious souls but if there is the perception that the Lib Dems collectively lack ambition there is no reason for them to stand around idly. In the worst-case scenario, the most talented Liberal Democrats will attach themselves to the Conservatives or defect to Labour or abandon politics. In a decade, perhaps less, Britain could move from a two-and-a-half-party system towards a two-and-a-quarter party configuration. The choice of leader will hasten or hamper that evolution.

A mischievous observer would conclude that the party should endorse Chris Huhne’s bid to succeed Sir Menzies. He is the aspirant inclined to tell Lib Dem activitists what they want to hear, not the harsh truths they must be confronted with. A more benign individual would conclude that Nick Clegg provides Liberal Democrats with their best chance of restoring their fortunes and back him. Yet even he can only do so if the party really yearns to be plausible. Does it?