1) The main damage to the Democratic primaries was self inflicted. Wanting to make great improvements to our Union we let our ambition escalate to grandiose proportions. Not satisfied with managing a competent end to our role in Vietnam we embrace the one who will end it tomorrow before noon, regardless to the cost of our allies. Wanting to create a fairer America we want to redistribute wealth on a massive scale. This was the problem with McGovern it is the disaster of a Sanders nomination.
I was an 18 year old, the only Democrat in a Goldwater house. When McGovern was nominated I went to my next door neighbor, who was a couple of years older and from one of the staunchest Democratic families in the city with great joy expressing how we were certain to win and he looked at me glumly and said "we are going for a historic loss, probably 50-0". "How can that be?", "McGovern is proposing a massive income redistribution plan that will set taxes at 77%, even my dad won't vote for him".
http://www.nybooks.com/articles/1972/05/04/george-mcgovern-on-taxing-redistributing-income/
he cumulative lifetime tax on recipients should take the following form: A base amount would be exempt from taxation—this amount is now set by the government at $60,000. Then a progressive tax would be levied, reaching an upper limit of 77 percent—the current statutory ceiling—on an estate of $500,000 or more. The base exemption should be increased when the estate includes a wholly owned proprietorship.
2) Most of the "Watergate activities" while illegal and disturbing didn't have much impact, especially after the Eagleton affair which proved that McGovern was an inept. The likely target of the Watergate break had little to do with McGovern campaign, which is where all the strategic information on the Presidential campaign was. It almost certainly was to try and find out how much Larry O'Brien knew about Howard Hughes payments to Nixon.
After Atomic testing was done in Nevada Hughes was angry because he had invested $ 500,000 (before he was President in secret payments) to Nixon with an understanding that there would be no testing in Nevada. When Nixon went ahead of it anyway Hughes went nuts and after Bobby was assassinated dreamt of buying the RFK campaign en masse and running his own candidate. He paid O'Brien a retainer and then nothing ever happened, O'Brien went to the largely ceremonial post of head of the DNC. Nixon, almost certainly, wanted to find out what O'Brien knew about payments to Nixon.
The Watergate break in was basically a defensive move that, obviously, backfired.
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