How do political parties develop policy preferences and how do they change them? By examining the strategic choices of four social democratic parties in Europe, this article contends that political parties serve diverse internal constituencies. Instead of analyzing political parties as goal‐oriented, rational organizations bent on winning votes or offices, the article views political parties as a vehicle for internal groups to promulgate their ideological and political preferences. Party strategy emerges from a tug‐of‐war between these internal constituencies and may often produce seemingly “irrational” results in terms of vote or office maximization. Social democratic parties with close organizational ties to unions representing workers in declining industries experience difficulties in adjusting their policy orientation to new socio‐economic conditions as a result of resistance from