The battle for the future of democratic republics
Celebrations in the US for its 250th anniversary are in part a wake
Martin Wolf
© James FergusonOn July 4 2026, the US celebrated the 250th anniversary of its Declaration of Independence, whose opening words were: “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.”
Let us focus on what those words could mean in future, rather than what they meant over the past 250 years.
Despite the bold claim about equality, the US created by the founding fathers was inevitably far from democratic.
Some 60-70 per cent of adult white men had the vote in 1792.
But women, slaves, many free Black people and Native Americans were excluded.
Universal suffrage democracy was still almost unthinkable.
Achieving it was a long struggle, in the US and elsewhere.
The founders thought they were creating a republic, not a democracy.
In the former, the head of state is elected, not a hereditary monarch.
Today, however, this is no longer a useful distinction.
We would regard a constitutional monarchy with an elected government, such as Denmark’s, as a democracy, and a supposed republic, in which political opponents find themselves in prison, such as today’s Turkey, as yet another autocracy.
The distinction between a democracy and an autocracy depends on two features: the role of fair elections in deciding who holds power and the role of law, especially constitutional law, in constraining what the people in power can do.
In a republic, government is not only elected, but law-governed and constrained, not arbitrary and despotic.
Democratic republics, then, are what we would now call “liberal democracies”, namely, ones that combine fair elections with fundamental civil and political rights.
In 2025, according to V-Dem, just 7 per cent of the world’s population lived in such a state, down from 17 per cent two decades earlier.
Was the US one of them?
No.
It lost that status under Donald Trump, for obvious reasons, with an exceptionally rapid decline in 2025.
This cannot surprise sane people.
In sum, the US celebrations are in part a wake: liberal democracy and even electoral democracy are in retreat.
So, why has this been happening?
And where might the system go in future?
In The Crisis of Democratic Capitalism, I attributed the rise of contemporary democracy to the spread of liberal ideas, which the Declaration of Independence itself embodied.
But, as optimists indicated it might, economic freedom led, in time, to a host of technological, social, political and cultural changes.
These included industrialisation, urbanisation, mass education, a growing middle class and an organised working class.
Also important was the need for a conscript army able to bear arms in defence of the nation.
In sum, governments started to care more about their people, while the latter became more economically and politically organised.
Quite ordinary people were then able to insist on being treated as citizens with economic and political rights.
Thus was born the demand for universal suffrage.
How could states committed to the principles of “equality” refuse such a demand?
In the end, they conceded.
Yet, today, the triumph of liberal and democratic ideals, with the collapse of the Soviet Union, seems ancient history.
In many former colonies, their roots were understandably shallow.
The success of autocratic China has also been influential.
Powerful interests in favour of autocracy operate in many countries.
So too does the age-old human desire for a strong leader.
Meanwhile, in many supposedly consolidated democracies, cultural and identity divisions have fractured a sense of shared citizenship.
So did technological and economic changes — the digital revolution, the rise of social media, deindustrialisation, the relative decline of the old working class and the rise of a huge university-educated elite.
In this world, populism has returned, in force, with its false promises of salvation.
To try to understand what might happen next, it is essential to remember an obvious truth: democracy is founded on an ideal of political equality.
Such a system is far more likely to operate, as Aristotle himself noted, in a society with prosperous and confident middle and lower middle classes.
That is what the growth of the 19th and 20th century delivered to the high-income countries.
But this has now, to a significant extent, reversed for the old industrial working class.
Today, AI threatens a significant portion of the educated middle class, too.
Indeed, the Bank for International Settlements suggests in its latest annual economic report that if AI replaced much of human labour, the latter’s share of income could fall to 20 per cent.
This would be a return to a feudal society, in which a small portion of the population controlled everything that mattered.
We can already see the rise of an extraordinarily rich and powerful plutocracy: the wealth of the top 0.00001 per cent of US citizens is far greater relative to national income today than it has ever been before.
We can even envisage the emergence of private robotic armies.
Moreover, these oligarchs exercise powerful influence on politics, both at home and abroad.
We should add to this the Balkanisation of the media ecosystem by social media.
Arguably most important, if they are to endure, democratic republics require a responsible and ethical elite committed to ideals of civic virtue.
Is that what the plutocracy is delivering today?
Is this what Trump has ever offered?
No.
And, apart from all this, the old democracies suffer severely from fiscal overstretch.
So, what is the future of liberal democracy?
Embattled.
If it is to survive, we will have to fight for it, again.
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