United States is perhaps the oldest continuously existing democracy [0], in has existed 244 years, and most of that time (about 200 years) it has been a two-party system. I don't think it's the two-party system that is responsible for the rotting now. Something else is going on.
[0] Well, we can debate how to define a democracy (an interesting and educational debate), and who is oldest still existing depends on the definition. But a good case can be made that it's the US.