The transition was from a flawed, but still readily identifiable constitutional republic (not a democracy), to a corporate oligarchy.
This has never been a democracy, and furthermore, the constitution insists that the federal government guarantee each state a republican form of government, as in, a republic -- not a democracy. That's in article 4, section 4.
This is why representatives decide the actual matters, and voters don't, in the basic design.
Of course, now even the representatives don't decide -- nor judges -- if the legislation deals in any significant way with business interests. The only way the old system still operates even remotely the way it was designed to is when the issue(s) at hand a purely social ones. Even then, the bill of rights seems to be at the very bottom of any legislator's or judge's list of concerns.
Can't see any of this changing, though. The public is too uninformed, and short of completely revamping the school curriculums, they're going to remain that way.