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How do I hold a project leader's feet to the fire without offending?

1. Don't try and tackle this publicly (at first), you will end up grabbing him by the tail!

2. Hold an honest 1:1 chat with him, explaining that his lack of leadership/vision is causing this, this, and this to the project.

3. Don't get personal.

4. Explain that the team and other younger people are looking up to him or her as a leader and this is what they are missing/expecting from him or her. Realization!

If the situation is still not salvageable, then I would suggest working towards putting your weight behind getting a replacement.