The battle for democratic republics

Celebrations in the US for its 250th anniversary are in part a wake for a form of government in retreat

Financial Times UK

8 Jul 2026

Martin Wolf martin.wolf@ft.com

On 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 nd 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. (See charts.)

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 inuential.

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 condent 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 signicant extent, reversed for the old industrial working class. Today, AI threatens a

signicant 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 inuence 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 scal overstretch.

So, what is the future of liberal democracy? Embattled. If it is to survive, we will have to fight for it again.