Does democracy work?

I'm interested in political science, so sometimes I try to think about what makes a good country, why some countries suck, etc. I've pretty much always thought democracies were inherently good, and the more power in the hands of the people, the better. (And by democracy I mean direct democracy, with little to no representation) I thought people deciding what happens in their country is a good thing.

But lately I've been thinking leaving government up to people may not be such a great idea. People are dumb. I've always hated the electoral college and used it as evidence for why America sucks, but I'm having second thoughts about letting people vote for things themselves. (Not in America, just theoretically, because in America politicians are more retarded than the people so it doesn't really help.)

My priority is always freedom. IMO, protecting civil liberties is by far the most important reason to have a government. Not for protection or economic stability, but for freedom. Of course a government should try to achieve those other things, but not if it costs anyone any liberties. But apparently people cannot be trusted to protect their own liberties. Just look at organizations like MADD, the Brady Campaign, the American Family Associateion, supporters of prop 8, etc. For some reason, people are just dying for the government to make more laws about anything.

I really don't understand how people think it's ok for the government to say you can only drive a vehicle when the concentration of a certain molecule in your blood stream is below a certain threshold. It's unbelievable to me that people are alright with this. Who gives them the right to tell you what to ingest? I've always blamed stupid politicians, but I'm starting to realize that its people that are stupid. It seems like people are so scared of dying or people that are different from them that they beg the government to take their rights away.

But what systems could be better? I'd like some kind of minimal state, but there has to be a mechanism for maintaining the state and making decisions when necessary. A dictatorship under the right person would obviously be the best form of government, but that's assuming there is a right person. Someone who wouldn't let the power corrupt them, and would always make decisions with the interest of his people at heart. And then select a successor with all the same qualities. It seems unlikely, and doesn't leave any checks in case he does become corrupt.

Some kind of meritocracy or noocracy would make sense, where the smartest people rule, but just because a person has merit doesn't mean they believe in freedom, or wouldn't become corrupt. It seems like the more people you have making decisions, the less of a chance any of them could become corrupt... but if you have too many people than it's no longer a noocracy, its a democracy, which has the flaw of letting stupid people decide things.

Maybe a democracy can work, someplace where people aren't so stupid. Maybe with a better education system that taught children the importance of freedom, people wouldn't vote their liberties away. But then again, education is simply a way for countries to maintain that status quo by brainwashing their youth, so if the country every went south it would most likely stay that way. I don't know, I'm still torn on the issue.