It's been said around here before (just a little while ago in one of the similar threads. edit: here) that the democrats aren't seeking moderate or republican voters, they are seeking republican donors. Their strategy suddenly makes much more sense when seen through that lens. Even setting that aside though, they would absolutely prefer to lose to Republicans than concede to the left. It's basically the same idea as class solidarity in that they will always be on the side of those who actually share their interests, even if they are in competition with them, rather than side with those who oppose their interests, even when doing so could give them a competitive advantage over their supposed adversaries in an election.