> Their model, I think, only works for democracies.

Completely agree but I suspect democracy is not enough. When a leader manages to assume a power that can be kept by other means like nationalistic rhetoric or cultural issues they can too engage in economically irrational politics.

People often rally behind ideas about god, identity or ideology. In fact this is very natural and expected because otherwise people could have accepted offers like "if you let me exterminate this group of people I will give you gas at discount".