I was struck by the slipping away of democracy too, as I watched the Revenge of the Sith. At the time I happened to be reading Steve Pressfield's historical novel Tides of War about the Peloponnesian war. The book does an outstanding job of showing all the flaws of Athenian democracy--the fickleness of the masses, the herd behavior, and the hatred of anyone who displays demonstrable superiority in any way. A gripping reminder that democracy doesn't always lead to the right decisions so limiting the scope of those decisions is wise.
It also reminds that democracy sucks, it just sucks less than every other system of collective decisionmaking out there.