I realize I forgot to respond to the question posed of where democracy does work well...as my computer was giving me a hard time and crashed, losing (as usual) the incredibly lucid and eloquent post I was nearly done with, I hadn't gotten back to that till just now.
So. Where does democracy work best? Oddly enough, I think it likely works best in a constitutional monarchy, where all the show of power and pomp and circumstance and mandated reverence can be vested in a visible ruler who handles that well and graciously--a career diplomat or an actor, but with a crown--while the Prime Minister is a person who does the real work--and understands the practical meaning of the term "public servant". Separate these two faces of power from being vested in any one person, and you solve a multitude of problems.
Also, because in a monarchy the King or Queen is by default and tradition not a member of either/any political party, there is far less incentive to maximize party clout at the expense of responsiveness to actual needs. Therefore, every acting government is assembled as a coalition, and in Europe there are generally at least three major political parties, which represent actual relevant factions within the population, instead of being, as in the U.S., a chronic cage-match between two vehemently opposed but ill-defined establishments.
Also--size matters. So does diversity. The U.S., by dint of being a continent-wide, multi-climated republic made up of individual states--and with so many different industries and demographics and cultures and religions within them, due to a history of changing immigration patterns--is ill-equipped to be run well at the national level. Even the state level is a difficulty, as the needs and values of cities & suburbs vs. small towns and rural areas can be radically, even foreignly different. There are enclaves both of traditionalism and progressivism that have a hard time even realizing each other's existence, though to be accurate, the progressives seem to have less of an agenda of imposing themselves over others in a militant way. Real tolerance and dialogue, though, is a hard thing to achieve when yes, part of this country do speak and live and think in radically different languages than others.
In this, the U.S. has an even greater social problem than the USSR did in holding its territories together. There, at least there was a generally-similar shared culture (and geography, and a very long cultural history) that made for some comparative solidarity under pressure, whereas here the issues of states' rights and minorities have been present and heated all through the nation's growth, while rarely coming to an actual boil and letting off some badly needed steam. The United States was based on an ideological and imaginative unity rather than a genetic or ethnic one--which makes the loyalties of Americans similarly ideological rather than set in the blood itself. Avoiding certain problems thereby, but greatly exacerbating others, especially in terms of varying interpretations of the nation's greatness, or its destiny. This was likely the first nation to be so deliberately constructed as a demonstration of ideal social and political principles--the whole Great Experiment in absolute political balance and civic equality. Equality of those deemed competent to participate in its decisions, yes--but the nation evolved and grew with its people.
I'm very fond of the general concept of evolution lately, I should mention, even as it's being maligned and threatened by some benighted and reactionary fellow-citizens in this land. "Intelligent design" is one thing--intelligent self-growth is quite another, and a far more honourable thing in my estimation.
So. Ironic, isn't it, that I see the self-proclaimed champion of democracy being one of its worst practitioners? Really, there is not much at all separating America from being an empire, or a dictatorship...the "Fourth Reich" observations in my mind started a while ago, as I gained grim certainty on a certain day in September 2001, when I realized that the Bush administration would used this tragedy--whoever and whatever caused it--to further its own ambitions and agendas in any way possible--and largely succeed. Because in a crisis even Americans, in general, don't look too closely at the devil's deal they're offered--not when there's emotion involved, and revenge to be gained and heartstrings to be wrung.
The things that are remaining--freedom of speech and the press and religion, right to public assembly and petition for redress of grievances, the right of security in one's own home and personal records, the integrity of voting by conscience, the power of judicial review, and the possibilities of further evolution in civil rights for all--those sort of things are either being quietly compromised, ignored or fought against with fanatical determination by the ruling party. We may not have crowns or thrones in the White House, but there is tyranny afoot in this my native land.
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There, I waxed eloquent a bit--it happens. I could make a political career of my own with that. But at least there's one president I'd never stoop to write speeches for. Selling one's soul, or even loaning it, is not a prudent habit.
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